01:28 PM EDT, 08/25/2025 (MT Newswires) -- Canadian banks report their third-quarter results from August 26, with Scotiabank (BNS.TO), and BMO (BMO.TO), notes BMO.

Across the "Big 5" (excluding BMO) analysts Sohrab Movahedi and Etienne Ricard expect cash operating EPS to be essentially flat y/y, with growth slowing relative to the first half of 2025.

"Our estimates contemplate high-single-digit y/y PTPP industry earnings growth, with higher y/y NIM and mid-single-digit fee revenue growth offsetting muted loan growth; we expect sequentially lower performing PCL builds but still higher total PCL ratios y/y."

While the analysts are maintaining their "best offense is a good defense" stance, they say they have a more optimistic earnings outlook for banks beyond the third quarter, which is predicated on a stronger macroeconomic backdrop in Canada.

Movahedi's and Ricard's preferred names have greater exposure to the Canadian market (higher ROE). They recommend Outperform-rated CIBC (CM.TO), National Bank (NA.TO) and RBC (RY.TO).

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