Scotiabank (TSX: BNS) has reported their Q2 2025 financials, headlined by a net income of $2.03 billion, down 3% from $2.09 billion a year earlier, as a sharp rise in credit-loss provisions weighed on results.
The bank set aside $1.40 billion for credit losses — a 39% increase from $1.01 billion a year ago and 20% higher than the $1.16 billion provisioned in Q1. Provisions on performing loans alone soared to $346 million from $32 million in Q2 2024, reflecting management’s caution over an uncertain macroeconomic outlook and US tariff risks.
“Our performing allowances rose to reflect the impact of a challenging economic environment,” said CEO Scott Thomson. “With strong balance-sheet metrics, we remain well positioned to support our clients through this period of uncertainty and to seize growth opportunities as they arise.”
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Net interest income climbed 12% to $5.27 billion from $4.69 billion in Q2 2024, but slipped 2% from $5.17 billion in the prior quarter. Non-interest income declined 4% year-over-year to $3.81 billion, hurt by lower trading gains and weaker investment performance, and was down 9% from Q1’s $4.20 billion.
Non-interest expenses increased 8% year-over-year to $5.11 billion but fell 21% sequentially after one-off charges in Q1.
Diluted earnings per share were $1.48, down from $1.57 in Q2 2024 and up from $0.66 in the previous quarter.
On an adjusted basis, Scotiabank’s net income of $2.07 billion dipped 2% from $2.11 billion in the year-ago quarter, with adjusted EPS of $1.52 versus $1.58 a year ago.
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On a per segment basis, Canadian Banking earnings plunged 31% to $613 million, hit by higher provisions and margin compression despite solid deposit growth. International Banking earnings rose 7% to $719 million on lower credit losses and productivity gains.
Global Wealth Management posted a 17% gain to $407 million, as assets under management jumped 9% Yoy to reach $380 billion, while Global Banking & Markets delivered $412 million, up 10% from a year ago.
Adjusted return on equity eased to 10.4% from 11.3% in Q2 2024. The bank’s Common Equity Tier 1 ratio strengthened to 13.2% at quarter-end from 12.9% three months earlier.
The bank boosted its quarterly dividend by four cents to $1.10 per common share, payable on July 29, 2025 to shareholders of record as at July 2, 2025, and has filed its intention with regulators, including the TSX, to launch a normal course issuer bid to buy back up to 20 million common shares (about 1.6% of its outstanding shares).
Scotiabank last traded at $71.74 on the TSX.
Information for this story was found via Sedar and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
