The Bank of Nova Scotia (BNS) Q1 2026 earnings summary

Executive summary

• Adjusted Q1 2026 earnings reached CAD 2.7 billion, or CAD 2.05 per share, up 16% year-over-year, with all business lines reporting earnings growth and strong revenue performance.

• Reported net income was $2,299 million, up 131% year-over-year, with diluted EPS of $1.73, reflecting the impact of prior-year impairment losses from Latin American divestitures.

• ROE was 13% adjusted (up 120 bps year-over-year), tracking ahead of medium-term targets, with expectations to surpass 14% ROE a year ahead of plan.

• Strategic focus remains on organic growth, technology and AI investments, and disciplined capital deployment, including share buybacks.

• 82% of Q1 2026 earnings derived from North America, with capital strength supporting a positive outlook.

Financial highlights

• Total revenue was $9,646 million, up 3% year-over-year; adjusted revenue was $10,077 million, up 8% (11% ex-divestitures).

• Net interest income increased 8% to $5,582 million; net interest margin rose to 2.45%.

• Non-interest expenses were $5,299 million, down 18% year-over-year; adjusted expenses up 3% (7% ex-divestitures); productivity ratio improved to 54.9% (adjusted 52.3%).

• Provision for credit losses was $1,176 million, up slightly year-over-year; ratio at 0.61%.

• CET1 capital ratio stood at 13.3%, up 10 bps quarter-over-quarter, after repurchasing 4.9 million shares.

Outlook and guidance

• ROE expected to expand across all business units, with Canadian Banking targeted for the largest increase.

• Management expects to achieve a return on equity above 14% by 2027, one year ahead of prior commitments.

• Impaired PCLs anticipated to remain elevated in the first half of the year, trending lower in the latter half as macro conditions improve.

• Deposit margin expansion and business mix improvements are key drivers for 2026 and 2027 performance.

• Economic growth in Canada and the U.S. is expected to moderate in 2026, with inflation pressures persisting.