National Bank of Canada’s (TSX: NA) fiscal Q4 2025 was a revenue-driven beat with total revenue rising to $3.70 billion from $2.94 billion last year, powered by net interest income of $1.17 billion versus $784 million and non-interest income of $2.53 billion versus $2.16 billion.
The revenue mix leaned heavily on trading revenues of $1.25 billion from $1.12 billion, plus higher underwriting and advisory fees at $172 million from $91 million, and stronger investment management and trust service fees at $373 million from $302 million.
However, costs scaled faster than revenue on a reported basis. Quarterly non-interest expense increased to $2.09 billion from $1.59 billion, led by compensation and benefits at $1.16 billion from $954 million and technology at $417 million from $274 million, alongside higher professional fees of $150 million from $102 million.
Management flagged $62 million of intangible-asset impairment tied to technology developments being discontinued.
Income before PCL and tax rose to $1.61 billion from $1.35 billion, but provisions for credit losses jumped to $244 million from $162 million, compressing the operating momentum downstream. Pre-tax income was $1.37 billion up from $1.19 billion and taxes were $308 million up from $235 million, with the effective tax rate moving to 23% from 20%, attributed mainly to Pillar 2 impacts.
That delivered Q4 net income of $1.06 billion, up from $955 million, but diluted EPS fell to $2.57 from $2.66 even as earnings rose.
Excluding specified CWB items, Q4 adjusted net income was $1.16 billion versus $928 million and adjusted diluted EPS was $2.82 versus $2.58. Adjustments in the quarter included $114 million of CWB acquisition and integration charges and $24 million of amortization of CWB-related intangibles, partly offset by non-interest income items like a $54 million gain on fair value remeasurement of an equity interest.
For the full year ended October 31, 2025, revenue increased to $13.98 billion from $11.40 billion, while non-interest expense climbed 26% to $7.60 billion from $6.05 billion. Pre-provision earnings rose to $6.38 billion, but PCL more than doubled to $1.25 billion from $569 million, including $230 million of initial provisions on non-impaired loans acquired from CWB.
Reported net income grew to $4.02 billion, yet diluted EPS dropped to $10.07 from $10.68 due to specified items and a larger share base.
CET1 ratio inched up to 13.8% from 13.7%, while Tier 1 ratio fell to 15.1% from 15.9% and TLAC ratio declined to 29.7% from 31.2% as risk-weighted assets expanded to $188.8 billion from $141.0 billion. The share count rose to 391.1 million from 340.7 million, and book value per share increased to $78.39 from $65.74.
Adjusted fiscal 2025 net income was $4.48 billion, with adjusted diluted EPS at $11.28, helped by Wealth Management and Capital Markets performance.
National Bank last traded at $170.71 on the TSX.
Information for this briefing was found via Sedar and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
