Ebrahim Poonawalla

Ebrahim Poonawalla asked about the commercial loan growth outlook, specifically in the U.S. regarding the impact of the tax bill on business investments and hiring, and potential risks from tariff uncertainties. He also questioned what is needed to lift the macro overhang in Canada, particularly concerning USMCA clarity.

Answer

Ernie Johannson, Head of U.S. Banking, noted general client optimism in the U.S., growing pipelines, and the expected benefit from new commercial bankers and technology investments, anticipating loan growth pickup by Q2/Q3 2026. Sharon Haward-Laird, Head of Canadian Commercial Banking, described the Canadian tone as cautiously optimistic with strong pipelines and momentum, emphasizing deposit growth and readiness for CapEx, while acknowledging that more certainty would be a positive contributor.

Ebrahim Poonawalla inquired about the drivers of Scotiabank's double-digit EPS growth outlook for the Canadian banking segment, focusing on PCL normalization, pre-tax pre-provision (PTPP) growth, and the bank's ROE trajectory and capital deployment strategy, including potential M&A.

Answer

CFO Raj Viswanathan and Group Head of Canadian Banking Aris Bogdaneris detailed Canadian banking's expected mid-single-digit PTPP growth from margin expansion, disciplined expenses, and strong fee income, with PCLs normalizing to the high 30s. President and CEO Scott Thomson expressed confidence in surpassing the 14%+ ROE target ahead of schedule, prioritizing organic capital deployment, share repurchases, and selective U.S. tuck-in acquisitions.