MONTREAL, May 27, 2026 /CNW/ - For the second quarter of 2026, National Bank is reporting net income of $1,234 million, up 38% from $896 million in the second quarter of 2025. Diluted earnings per share stood at $3.06 in the second quarter of 2026, up 41% from $2.17 in the second quarter of 2025. These increases reflect good performance across the business segments and lower provisions for credit losses, particularly due to the initial provisions for credit losses recorded in the second quarter of 2025 on acquired non-impaired Canadian Western Bank (CWB) loans. Excluding specified items(1) recorded in the second quarters of 2026 and 2025 mainly related to the acquisition of CWB, adjusted net income(1) stood at $1,303 million, up 12% from $1,166 million in the corresponding quarter of 2025. Adjusted diluted earnings per share(1) stood at $3.23, up 13% from $2.85 in the second quarter of 2025.
For the six-month period ended April 30, 2026, the Bank's net income totalled $2,488 million, up 31% from $1,893 million for the corresponding period of 2025. Diluted earnings per share stood at $6.14 compared to $4.91 for the corresponding period of 2025, an increase of 25%. This growth was driven by good performance across all business segments and the inclusion of CWB's results starting in the second quarter of 2025. Adjusted net income(1) for the six-month period ended April 30, 2026 totalled $2,623 million, up 18% from $2,216 million for the corresponding period of 2025, while adjusted diluted earnings per share(1) stood at $6.48, up 12% from $5.78 for the six-month period ended April 30, 2025.
"We delivered strong growth in the second quarter, reflecting the diversification of our business and continued client activity across our franchises. Our performance was further supported by credit discipline, CWB-related synergies and share buybacks," said Laurent Ferreira, President and Chief Executive Officer of National Bank of Canada. "In the context of heightened macroeconomic uncertainty, we remain well positioned to support our clients, and continue delivering strong earnings growth and return on equity, while maintaining robust capital levels," concluded Mr. Ferreira.
Highlights
(millions of Canadian dollars)
Quarter ended April 30
Six months ended April 30
2026
2025
% Change
2026
2025
% Change
Net income
1,234
896
38
2,488
1,893
31
Diluted earnings per share (dollars)
$
3.06
$
2.17
41
$
6.14
$
4.91
25
Income before provisions for credit losses and income taxes
1,848
1,708
8
3,730
3,245
15
Return on common shareholders' equity(2)
15.9
%
11.9
%
15.8
%
14.0
%
Dividend payout ratio(2)
42.3
%
42.2
%
42.3
%
42.2
%
Operating results, Adjusted(1)
Net income, Adjusted
1,303
1,166
12
2,623
2,216
18
Diluted earnings per share, Adjusted (dollars)
$
3.23
$
2.85
13
$
6.48
$
5.78
12
Income before provisions for credit losses and
income taxes, Adjusted
1,936
1,850
5
3,909
3,460
13
Return on common shareholders' equity, Adjusted(3)
16.8
%
15.6
%
16.7
%
16.5
%
As at
April 30, 2026
As at
October 31, 2025
CET1 capital ratio under Basel III(4)
13.5
%
13.8
%
Leverage ratio under Basel III(4)
4.3
%
4.5
%
(1)
See the Financial Reporting Method section on pages 3 to 6 for additional information on non-GAAP financial measures.
(2)
For details on the composition of these measures, see the Glossary section on pages 45 to 48 in the Report to Shareholders, Second Quarter 2026, which is available on the Bank's website at nbc.ca or the SEDAR+ website at sedarplus.ca.
(3)
For additional information on non-GAAP ratios, see the Financial Reporting Method section on pages 5 to 12 in the Report to Shareholders, Second Quarter 2026, which is available on the Bank's website at nbc.ca or the SEDAR+ website at sedarplus.ca.
(4)
For additional information on capital management measures, see the Financial Reporting Method section on pages 5 to 12 in the Report to Shareholders, Second Quarter 2026, which is available on the Bank's website at nbc.ca or the SEDAR+ website at sedarplus.ca.
Second quarter of 2026 versus second quarter of 2025
Personal and Commercial
Net income totalled $355 million versus $132 million in 2025, a $223 million increase. Adjusted net income(1) totalled $373 million, up $57 million or 18%.
At $1,488 million, second-quarter total revenues rose $72 million or 5% mainly due to net interest income, in line with the growth in loan and deposit volumes, partly offset by a lower net interest margin.
Compared to a year ago, personal lending grew 11% and commercial lending grew 5%, due to the good organic growth.
Net interest margin(2) stood at 2.26%, down from 2.30%.
Non-interest expenses stood at $829 million, up 3%.
Provisions for credit losses were down $257 million, mainly due to initial provisions for credit losses of $230 million on acquired non-impaired CWB loans recorded in 2025.
At 55.7%, the efficiency ratio(2) improved compared to 56.8%.
Wealth Management
Net income totalled $274 million, an 18% increase from $232 million in 2025.
Total revenues amounted to $905 million compared to $791 million last year, a $114 million or 14% increase driven by growth in all types of revenues, mainly fee-based revenues.
Non-interest expenses stood at $531 million versus $476 million in 2025, a 12% increase associated with revenue growth.
At 58.7%, the efficiency ratio(2) improved compared to 60.2%.
Capital Markets
Net income totalled $488 million, versus $501 million in 2025, a 3% decrease.
Total revenues amounted to $1,074 million, down 2%, mainly due to a decrease in global markets revenues, partly offset by an increase in corporate and investment banking revenues.
Non-interest expenses stood at $439 million compared to $403 million, an increase that was due to compensation and employee benefits as well as expenses related to the segment's business growth.
Provisions for credit losses were $16 million compared to $64 million, a decrease attributable to provisions for credit losses on impaired loans.
At 40.9%, the efficiency ratio(2) deteriorated compared to 36.6%.
U.S. Specialty Finance and International (USSF&I)
Net income totalled $186 million, up 10% from $169 million last year.
Total revenues amounted to $410 million, a 5% increase attributable to revenue growth at the ABA Bank subsidiary.
Non-interest expenses stood at $131 million, a 12% increase mainly attributable to the ABA Bank subsidiary.
Provisions for credit losses were down $15 million, a decrease attributable to the Credigy and ABA Bank subsidiaries.
At 32.0%, the efficiency ratio(2) compares to 30.0%.
Other
The Other heading reported a net loss of $69 million compared to a net loss of $138 million in 2025, owing mainly to a higher contribution from Treasury activities, as well as the decrease in non-interest expenses.
Capital Management
As at April 30, 2026, the Common Equity Tier 1 (CET1) capital ratio under Basel III(3) stood at 13.5%, down from 13.8% as at October 31, 2025.
Dividends
On May 26, 2026, the Board of Directors declared regular dividends on the various series of first preferred shares and a dividend of $1.32 per common share, up 8 cents or 6%, payable on August 1, 2026 to shareholders of record on June 29, 2026.
(1)
See the Financial Reporting Method section on pages 3 to 6 for additional information on non-GAAP financial measures.
(2)
For details on the composition of these measures, see the Glossary section on pages 45 to 48 in the Report to Shareholders, Second Quarter 2026, which is available on the Bank's website at nbc.ca or the SEDAR+ website at sedarplus.ca.
(3)
For additional information on capital management measures, see the Financial Reporting Method section on pages 5 to 12 in the Report to Shareholders, Second Quarter 2026, which is available on the Bank's website at nbc.ca or the SEDAR+ website at sedarplus.ca.
Laurentian Bank of Canada (LBC) Transactions
On December 2, 2025, the Bank entered into a definitive asset purchase agreement with LBC pursuant to which it will assume certain liabilities and acquire certain assets related to LBC's retail and SME business banking portfolios (Retail/SME Transaction), and the Bank will assume LBC's distribution agreement for certain mutual funds. Consideration of cash and cash equivalents to be received from LBC will be determined in reference to the value of liabilities assumed net of assets acquired, at the closing date.
The closing of the Retail/SME Transaction, expected to occur in late 2026, is conditional on all conditions precedent to the closing of the acquisition of LBC by Fairstone Bank (Acquisition Transaction) having been satisfied or waived, and to the closing of the Acquisition Transaction immediately following the Retail/SME Transaction. The Retail/SME Transaction is subject to customary closing conditions, including receipt of key regulatory approvals.
Separately, concurrently with the execution of the Retail/SME Transaction agreement, the Bank and LBC had also entered into a definitive loan purchase agreement in respect of the purchase by the Bank of LBC's syndicated loan portfolio (Syndicated Loan Transaction). On February 17, 2026, the closing of the Syndicated Loan Transaction occurred. The purchase price of $647 million was allocated between the acquired assets and the assumed liabilities based on their relative fair values as at the acquisition date, comprising loans and deposits totaling $657 million and $10 million, respectively.
Financial Reporting Method
The Bank's Consolidated Financial Statements are prepared in accordance with IFRS, as issued by the IASB and represent Canadian GAAP.
Non-GAAP and Other Financial Measures
The Bank uses a number of financial measures when assessing its results and measuring overall performance. Some of these financial measures are not calculated in accordance with GAAP. Regulation 52-112 Respecting Non-GAAP and Other Financial Measures Disclosure (Regulation 52-112) prescribes disclosure requirements that apply to the following measures used by the Bank:
non-GAAP financial measures;
non-GAAP ratios;
supplementary financial measures;
capital management measures.
Non-GAAP Financial MeasuresThe Bank uses non-GAAP financial measures that do not have standardized meanings under GAAP and that therefore may not be comparable to similar measures used by other companies. Presenting non-GAAP financial measures helps readers to better understand how management analyzes results, shows the impacts of specified items on the results of the reported periods, and allows readers to better assess results without the specified items if they consider such items not to be reflective of the underlying performance of the Bank's operations.
The key non-GAAP financial measures used by the Bank to analyze its results are described below, and a quantitative reconciliation of these measures is presented in the tables in the Reconciliation of Non-GAAP Financial Measures section on pages 4 to 6. It should be noted that, for the quarter and six-month period ended April 30, 2026, as part of the CWB acquisition and the LBC transactions, related items have been excluded from results since, in the opinion of management, they do not reflect the underlying performance of the Bank's operations, in particular, integration and transactions-related charges, amortization of intangible assets related to the CWB acquisition and initial provisions for credit losses on non-impaired loans acquired from LBC. For the quarter and six-month period ended April 30, 2025, several CWB acquisition-related items had been excluded from results (in particular, integration and transaction-related charges, amortization of intangible assets related to the CWB acquisition and initial provisions for credit losses on acquired non-impaired CWB loans). In addition, for the six-month period ended April 30, 2025, the amortization of the subscription receipt issuance costs, the gain resulting from the remeasurement at fair value of the CWB common shares already held by the Bank, the loss resulting from the impact of managing fair value changes were excluded from results.
For additional information on non-GAAP financial measures, non-GAAP ratios, supplementary financial measures, and capital management measures, see the Financial Reporting Method section and the Glossary section, on pages 5 to 12 and 45 to 48 respectively, of the Report to Shareholders, Second Quarter 2026, which is available on the Bank's website at nbc.ca or the SEDAR+ website at sedarplus.ca.
Reconciliation of Non-GAAP Financial Measures
Presentation of Results, Adjusted
(millions of Canadian dollars)
Quarter ended April 30
2026
2025
Personal and Commercial
Wealth Management
Capital Markets
USSF&I
Other
Total
Total
Operating results
Net interest income
1,212
241
(483)
373
(34)
1,309
1,205
Non-interest income
276
664
1,557
37
64
2,598
2,445
Total revenues
1,488
905
1,074
410
30
3,907
3,650
Non-interest expenses
829
531
439
131
129
2,059
1,942
Income before provisions for credit losses and income taxes
659
374
635
279
(99)
1,848
1,708
Provisions for credit losses
169
1
16
44
3
233
545
Income before income taxes (recovery)
490
373
619
235
(102)
1,615
1,163
Income taxes (recovery)
135
99
131
49
(33)
381
267
Net income
355
274
488
186
(69)
1,234
896
Items that have an impact on results
Non-interest expenses
Integration and transaction-related charges(1)
−
−
−
−
64
64
118
Amortization of intangible assets related to the CWB acquisition(2)
20
4
−
−
−
24
24
Impact on non-interest expenses
20
4
−
−
64
88
142
Provisions for credit losses
Initial provisions for credit losses on non-impaired loans acquired(3)
4
−
2
−
−
6
230
Impact on provisions for credit losses
4
−
2
−
−
6
230
Income taxes
Income taxes on the integration and transaction-related charges(1)
−
−
−
−
(18)
(18)
(32)
Income taxes on the amortization of intangible assets related
to the CWB acquisition(2)
(5)
(1)
−
−
−
(6)
(6)
Income taxes on initial provisions for credit losses on non-impaired
loans acquired(3)
(1)
−
−
−
−
(1)
(64)
Impact on income taxes
(6)
(1)
−
−
(18)
(25)
(102)
Impact on net income
(18)
(3)
(2)
−
(46)
