Toronto-Dominion (TD) Bank and Canadian Imperial Bank of Commerce (CIBC) reported higher third-quarter profits on Wednesday, ending a strong earnings season for Canada’s Big Six lenders.https://t.co/hsJucuf6SU
— Canadian Mortgage Professional Magazine (@CMPmagazine) August 28, 2025
‘Uncertainty meter’ has dropped, bank execs indicate
Bank of Montreal (BMO) chief executive officer Darryl White said in a call with analysts that the current environment was “just a little easier to call than it was six months ago” and indicated that the path ahead appeared slightly clearer. “Earlier this year, my uncertainty meter was very high,” he said. “Today, it’s less high.”
But he also stressed that Canada appeared to be in the “middle innings” of the trade war, with no sign yet of a deal to lift tariffs even as talks continue between Canadian and US negotiators.
“There are still the negotiations between Canada and the US, and the upcoming CUSMA [Canada-US-Mexico Agreement] negotiations,” De Souza said. “So there are still lots of things on the horizon and uncertainty. But at this point in time, the outlooks are a little steadier compared to the prior quarter.”
Continuing confidence hinges on trade talks, BoC moves
It remains to be seen whether PCLs will continue falling among Canada’s banking giants, with much depending on how those trade talks continue. “The outlook for PCLs depends on a few different things from our perspective,” De Souza said. “It’s the duration and magnitude of the tariffs.
“If the effective rate of the tariffs ends up being worse or longer than expected, then that’ll be negative towards the PCLs. If the tariffs are better than expected, or Trump eliminates them, that’ll be a benefit to the PCLs and they’ll take some reversals from all these performing provisions they took last quarter.”