Bank of Nova Scotia Q2 Earnings Up 16%, Raises Dividend and Buys Back 6.4M Shares
BNS•Bank of Nova Scotia reported adjusted Q2 earnings of $2.7 billion ($2.02 per share), a 16% rise in pre-tax-provision earnings and 13.2% ROE, while boosting the dividend by C$0.04 and repurchasing 6.4 million shares. Canadian segment PTP earnings grew 13%, international 12%, and net interest income rose 10%, CET1 ratio at 13.3%.
1. Q2 Financial Highlights
The bank delivered adjusted earnings of $2.7 billion, or $2.02 per share, marking a 16% increase in pre-tax-provision earnings year-over-year. Net interest income rose 10% and non-interest income climbed 17%, while expenses grew 7% and the productivity ratio improved by 290 basis points to 52.5%.
2. Segment Growth Drivers
Canadian banking pre-tax-provision earnings increased 13%, driven by margin expansion and fee income, while international banking PTP earnings rose 12%, including a 25% gain in Mexico. Global wealth management reported net sales of $4.7 billion and global banking and markets revenue grew 9%.
3. Shareholder Returns
The quarterly dividend was increased by C$0.04 per share, payable July 29, and the bank repurchased 6.4 million shares. It has also discontinued issuing new common shares from treasury under its dividend plan, opting for secondary-market purchases going forward.
4. Capital Ratios and Credit Provisions
The Common Equity Tier 1 capital ratio stood at 13.3%, with an allowance for credit losses of $7.3 billion (up two basis points). Impaired provision guidance is now expected in the mid-50 basis point range for the remainder of fiscal 2026 amid ongoing macroeconomic uncertainties.
