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1. Company Snapshot

1.a. Company Description

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally.It operates in four segments: Canadian Banking, International Banking, Global Wealth Management, and Global Banking and Markets.The company offers financial advice and solutions, and day-to-day banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and insurance to individuals; and business banking solutions comprising lending, deposit, cash management, and trade finance solutions to small, medium, and large businesses, including automotive financing solutions to dealers and their customers.


It also provides wealth management advice and solutions, including online brokerage, mobile investment, full-service brokerage, trust, private banking, and private investment counsel services; and retail mutual funds, exchange traded funds, liquid alternative funds, and institutional funds.In addition, the company offers international banking services for retail, corporate, and commercial customers; and lending and transaction, investment banking advisory, and capital markets access services to corporate customers.Further, it provides online, mobile, and telephone banking services.


The company operates a network of 954 branches and approximately 3,766 automated banking machines in Canada; and approximately 1,300 branches and a network of contact and support center internationally.The Bank of Nova Scotia was founded in 1832 and is headquartered in Halifax, Canada.

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1.b. Last Insights on BNS

The Bank of Nova Scotia's recent performance has been driven by strong quarterly earnings, with EPS growth fueled by robust trading revenue and disciplined cost management. The Caribbean division delivered impressive returns, highlighting the bank's evolving strengths. A bullish thesis on the stock cites its attractive valuation, with trailing and forward P/E of 17.11 and 11.35, respectively. The bank's digital expansion and international growth push have also garnered optimism. Additionally, its new cash management platform, launched in October 2025, signals a heightened commitment to supporting cross-border trade services. UBS maintains a Buy rating with a price target of C$94.

1.c. Company Highlights

2. Scotiabank's Q1 2026 Results: Strong Performance Across Key Segments

Scotiabank reported adjusted earnings of $2.7 billion or $2.05 per share, up 16% year-over-year, with a return on equity (ROE) of 13%, up 120 basis points. Revenue grew 11% year-over-year, driven by strong performance in Canadian Banking, Global Wealth Management, and International Banking. The actual EPS of $2.05 beat estimates of $1.96. The bank's CET1 ratio was 13.3% after repurchasing 4.9 million shares.

Publication Date: Feb -25

📋 Highlights
  • Adjusted Earnings Growth: Scotiabank reported adjusted earnings of $2.7 billion or $2.05 per share, a 16% YoY increase, with ROE rising to 13% (up 120 bps).
  • Segment Performance: Canadian Banking ($960M, +5%), Global Wealth ($488M, +18%), and International Banking ($717M, +8%) drove 11% YoY revenue growth.
  • Capital Strength: CET1 ratio at 13.3% after repurchasing 4.9 million shares, with positive operating leverage of 4.2% and a 200 bps improvement in productivity to 52%.
  • Credit Risk Metrics: Provision for credit losses (PCL) at $1.1 billion, with impaired PCL at 58 bps and a strong ACL ratio of 94 bps.
  • International Focus: International Banking delivered 16% ROE, with mixed macroeconomic outlooks in Mexico, Chile (stable), and Peru (uncertain), but low average LTVs (55%) in Canadian mortgages mitigated risk.

Segment Performance

Canadian Banking reported earnings of $960 million, up 5%, with ROE of 18.1%. Global Wealth Management earnings were $488 million, up 18%, with ROE of 17.9%. International Banking delivered earnings of $717 million, up 8%. Global Banking and Markets reported earnings of $545 million, up 5%, with ROE of 14.3%. The bank's provision for credit losses (PCL) was $1.1 billion, with an impaired PCL ratio of 58 basis points.

Asset Quality and Credit Performance

The Canadian Retail portfolio shows mixed results, with mortgage 90-plus day delinquency increasing quarter-over-quarter due to COVID-era mortgages concentrated in Ontario and the GTA. However, impaired PCLs remain low due to strong credit quality and low average LTVs of approximately 55% in the uninsured portfolio. In International Banking, impaired PCLs remain elevated but stable across key markets.

Outlook and Guidance

The bank's operating environment is expected to reflect ongoing challenges, with impaired PCLs remaining elevated in the near term before gradually trending lower as the economic outlook improves. The guidance for impaired PCLs remains high 40s to mid-50s, and the bank is comfortable with the adequacy of allowances and underlying portfolio quality. ROE is expected to reach 14% plus in 2027, driven by margin expansion.

Valuation

With a P/E Ratio of 16.44 and a P/TBV of 1.47 (implied by 'P/B Ratio': 1.47), the market is pricing in a certain level of growth and profitability. The Dividend Yield of 4.22% is attractive, indicating a stable return for investors. Analysts estimate next year's revenue growth at 5.3%, which is slightly higher than the current valuation multiples, suggesting that the stock may be fairly valued.

3. NewsRoom

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Bank of Nova Scotia (BNS) Q1 2026 Earnings Call Highlights: Strong Earnings Growth and ...

Feb -24

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Scotiabank kicks off Canadian bank earnings with fiscal first quarter beat

Feb -24

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What Makes Bank of Nova Scotia (BNS) a Strong Momentum Stock: Buy Now?

Feb -24

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Scotiabank beats earnings expectations with growth across all business segments

Feb -24

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Update: Scotiabank Lodges Big Q1 Earnings Beat, But Revs Lower and PCLs Edged Up

Feb -24

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Scotiabank Lodges Big Q1 Earnings Beat, But Revs Lower and PCLs Edged Up

Feb -24

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Bank of Nova Scotia: Fiscal Q1 Earnings Snapshot

Feb -24

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Scotiabank Announces Dividend on Outstanding Shares

Feb -24

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.87%)

6. Segments

Canadian Banking

Expected Growth: 4.5%

- The Canadian Banking segment is driven by a growing Canadian economy, increasing digital adoption, and a focus on customer experience, which is expected to drive loan and deposit growth, thereby contributing to the segment’s growth.

International Banking

Expected Growth: 7.2%

- This segment is expected to drive growth through its extensive network of branches and subsidiaries, particularly in the Americas and Asia, where there is a growing demand for corporate and commercial banking, transaction banking, and treasury services.

Global Banking and Markets

Expected Growth: 4.5%

- The Global Banking and Markets segment is expected to grow, fueled by increasing corporate and investment banking, markets, and research demands from corporate, government, and institutional clients, driven by the need for financial products and advisory services, particularly in emerging markets.

Global Wealth Management

Expected Growth: 8.6%

estimated CAGR, driven by increasing demand for wealth management services from high net worth clients, expanding presence in emerging markets, and strategic acquisitions to enhance capabilities and expand geographic reach.

Other

Expected Growth: 7.4%

- The "Other" segment, comprising revenues from investments in other companies, gains on sale of real estate, and miscellaneous income, is driven by strategic investments, divestitures, and growing miscellaneous income, positioning the segment for continued growth.

7. Detailed Products

Personal Banking

Personal banking services for individuals, including chequing and savings accounts, credit cards, loans, and investment products.

Credit Cards

A range of credit cards with different features, benefits, and rewards programs.

Mortgages

Mortgage solutions for homebuyers, including fixed and variable rate mortgages, and mortgage insurance.

Investments

A range of investment products, including mutual funds, exchange-traded funds, and portfolio management services.

Business Banking

Business banking services for small businesses and commercial clients, including cash management, credit, and trade finance solutions.

Commercial Banking

Commercial banking services for large corporations, including cash management, credit, and trade finance solutions.

Wealth Management

Wealth management services, including investment advice, portfolio management, and estate planning.

International Banking

International banking services for individuals and businesses, including cross-border banking, trade finance, and cash management solutions.

8. The Bank of Nova Scotia's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for The Bank of Nova Scotia is medium due to the presence of alternative financial institutions and digital payment systems. However, the bank's strong brand and customer loyalty mitigate this threat.

Bargaining Power Of Customers

The bargaining power of customers is low due to the bank's large customer base and diversified product offerings, making it difficult for individual customers to negotiate better terms.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the bank's significant scale and negotiating power, allowing it to dictate terms to its suppliers.

Threat Of New Entrants

The threat of new entrants is low due to the significant regulatory barriers and capital requirements to enter the banking industry, making it difficult for new players to enter the market.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several established banks and financial institutions in the market, leading to intense competition for customers and market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 80.31%
Debt Cost 8.85%
Equity Weight 19.69%
Equity Cost 8.85%
WACC 8.85%
Leverage 407.93%

11. Quality Control: The Bank of Nova Scotia passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
CIBC

A-Score: 7.0/10

Value: 4.7

Growth: 5.9

Quality: 5.1

Yield: 8.0

Momentum: 8.5

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Scotiabank

A-Score: 6.9/10

Value: 5.0

Growth: 4.9

Quality: 4.2

Yield: 9.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
JPMorgan Chase

A-Score: 6.6/10

Value: 5.6

Growth: 5.2

Quality: 6.5

Yield: 5.0

Momentum: 8.5

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
NatBank

A-Score: 6.5/10

Value: 3.7

Growth: 6.4

Quality: 4.9

Yield: 6.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Citigroup

A-Score: 6.4/10

Value: 6.3

Growth: 4.7

Quality: 4.4

Yield: 6.0

Momentum: 9.0

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Bank of America

A-Score: 6.0/10

Value: 5.4

Growth: 5.2

Quality: 4.9

Yield: 4.0

Momentum: 7.5

Volatility: 9.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

105.68$

Current Price

105.68$

Potential

-0.00%

Expected Cash-Flows