EQB (EQB) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 revenue of CAD 327 million, up 3% sequentially and 15% year-over-year, with adjusted diluted EPS of $2.96, up 5% quarter-over-quarter, and adjusted ROE at 15.9%.

• Customer base expanded 6% sequentially and 32% year-over-year to over 485,000, with EQ Bank deposits rising 3% quarter-over-quarter and 8% year-over-year to $8.9 billion.

• Launched innovative products, including the Notice Savings Account and expanded small business banking, driving brand awareness and deposit growth.

• Dividend increased 4% sequentially and 24% year-over-year, fulfilling a five-year commitment to shareholders; DRIP suspended due to strong capital position.

Financial highlights

• Net income reached $117.2 million, up 6% from Q2 and 1% year-over-year; adjusted net income $112.2 million, up 6% sequentially, down 14% year-over-year.

• Non-interest revenue hit a record $56 million, up 13% sequentially and 70% year-over-year, representing 17% of total revenue.

• Net interest margin was 2.09%, with stable loan book yields and diversified funding.

• Book value per share rose to $75.67, up 3% sequentially and 12% year-over-year.

• Total loans under management increased 2% from Q2 and 11% year-over-year to nearly $67 billion.

Outlook and guidance

• Reaffirmed guidance for adjusted ROE above 15% for fiscal 2024 and loan growth of 8%-12%.

• EPS for 2024 expected between $11.50 and $11.75, with book value growth of 11%-13%.

• New medium-term guidance, including for dividends, to be provided with Q4 results.

• Management anticipates more pronounced asset growth in fiscal 2025 as monetary policy normalizes and housing demand persists.