Canada's biggest banks booked another profitable quarter as the group's median normalized EPS growth for the second fiscal quarter was 11.5% compared to a year ago.
Topping the list was Toronto-Dominion Bank with year-over-year normalized EPS growth of 20.9% to C$1.62. The bank's Canadian retail business, its largest segment, booked net income of C$1.83 billion, up 17% from a year ago. Its U.S. retail segment also reported a 16% increase in net income to C$979 million.
On an earnings call, Toronto-Dominion Bank Chief Risk Officer Ajai Bambawale said credit quality remains strong and that the bank is well-positioned for continued growth.
Bank of Nova Scotia posted the lone single-digit normalized EPS growth at 4.9%. The quarter was a mixed bag for Scotiabank. Net income for its Canadian banking segment and international banking segment increased 5% and 14% to C$1.02 billion and C$675 million, respectively. Net income for its global banking and markets segment, however, decreased 14% to C$447 million.

Canadian Imperial Bank of Commerce posted the highest growth in both net loans and total deposits, with 13.40% and 9.87%, respectively. Bank of Montreal posted the lowest net loan growth and total deposit growth at 1.49% and 0.99%, respectively.
BMO, which posted the second-largest normalized EPS growth at 14.6%, also recorded a posttax restructuring charge of C$192 million, mainly related to severance. CFO Thomas Flynn said the charge reflects "an ongoing bank-wide initiative to simplify operations and increase efficiency." The bank expects to generate expense savings of about $185 million from the charge.

On an earnings call, Toronto-Dominion Bank CEO Bharat Masrani said the bank remains open to acquisitions in Canada and the U.S., particularly in Florida. "The Southeast of the U.S. is really interesting to us," Masrani said. "We feel there is huge growth opportunities given our footprint in the U.S."
CIBC President and CEO Victor Dodig said the company is focused on "smaller tuck-ins" that would complement the bank's existing markets. However, the bank is more keen on investing organically and repurchasing stock.
BMO CEO William Darryl White said while the bank is well-positioned to enter into a deal, it should be for the "right event at the right price and the right strategic fit and cultural fit." Dechaine also wrote that the bank's operating leverage momentum outweighs M&A risks.
Meanwhile, National Bank of Canada President and CEO Louis Vachon said the bank is not planning more acquisitions until the end of 2020. "We achieved our objective of diversifying a little bit [of] our activities in Canada with [two] operations," he said. "We're quite happy with just operating these [two] assets and making sure that the performance continues to be as good as it's been in the last 2 years."

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