EQB Inc. (TSX: EQB) reported a Q3 2026 net loss of $127.3 million, reversing net income of $73.4 million a year earlier, after the company booked a $219.1 million initial credit-loss provision tied to the PC Financial credit-card portfolio acquired in July.
The reported loss largely reflects acquisition accounting rather than losses generated by PC Financial after closing. EQB excluded the $219.1 million Day 1 provision from adjusted results, along with $37.4 million of PC Financial acquisition and integration expenses, $22.0 million of acquisition-related intangible amortization and impairments, and a $1.7 million business-exit adjustment.
The acquisition also more than doubled EQB’s allowance for credit losses to $485.4 million from $170.4 million last year.
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Outside the Day 1 provision, credit costs were also moving higher. Adjusted provision for credit losses rose to $83.9 million from $34.0 million last year. EQB attributed the increase to one month of credit-card activity, softer conditions in residential and commercial real estate, and equipment-lease defaults.
Adjusted net income was then $80.7 million, up from $79.7 million last year, translating to diluted EPS of $2.12 compared with $2.07.
Revenue rose to $391.3 million from $306.1 million a year earlier. Net interest income jumped to $319.2 million from $258.5 million last year as the higher-yielding PC Financial credit cards helped push net interest margin to 2.41%.
Operating activities used $55.2 million of cash during Q3, compared with generating $314.5 million a year earlier.
The adjusted efficiency ratio was 50.1%, compared with 53.4% last year. Reported efficiency deteriorated to 65.5% as acquisition and integration expenses flowed through the quarter.
EQB said it remains on track for its low-50% adjusted efficiency ratio target for 2026. PC Financial integration has produced $15.0 million of annualized cost savings so far against a $30.0 million pre-tax annual run-rate synergy target. Management said the earnings contribution from the combined business should become more visible in Q4 and plans to outline its 2027 and medium-term return targets at its December Investor Day.
The bank’s CET1 ratio ended the quarter at 13.4%, slightly above 13.3% a year earlier. The company also raised its quarterly dividend to $0.63 per share from $0.61 in the previous quarter.
EQB last traded at $137.87 on the TSX.
