Canada's biggest banks posted stronger profits during the fiscal fourth quarter, setting them up to power through what some expect to be a more challenging 2019.

For the three months ending Oct. 31, the country's six largest banks posted median normalized EPS 9.6% higher than a year prior, with half the group showing double-digit growth. Aggregate profit across the group topped C$12.01 billion, compared to $10.54 billion a year earlier.

Toronto-Dominion Bank, Canada's biggest bank by assets, posted the highest normalized EPS growth at 19.9%, hitting C$1.63. The bank's Canadian and U.S. retail segments, as well as its wholesale banking segments, all contributed with higher year-over-year net income. During a call to discuss the results, CEO Bharat Masrani pointed to the bank's diversified business mix, its footprint in North America, and "a risk appetite that has always served as [the company's] compass" in explaining the earnings improvement.

During the quarter, TD Bank continued to grow both net loans and total deposits, rising by 6.03% and 7.05%, respectively. Such growth was shared by its Canadian peers, though the magnitude varied among the group.

Canadian Imperial Bank of Commerce, for instance, saw the weakest percentage growth in both net loans and total deposits at 4.1% and 4.9%, respectively. On the other hand, Bank of Nova Scotia posted the highest net loan growth at 8.53%, while National Bank of Canada booked the highest total deposit growth at 9.73%.

At CIBC, which posted the lowest normalized EPS growth among the group at 6.8%, President and CEO Victor Dodig noted that the company expects 2019 to be "more challenging, macroeconomically speaking, than 2018," due to various political and economic headwinds. However, he added that the company should still hit its guidance targets.

"We'll work diligently on building up our capital and work diligently on delivering those earnings irrespective of the market environment," he said.

Should the coming year present fresh challenges, the group of Canadian banks is well-positioned to push through, according to Moody's. In a recent report, the rating agency said it expects to maintain a stable outlook on Canadian banks given their sound capital and liquidity, strong recurring profits and the reduction of growth in household debt.

"We anticipate the concentrated industry structure will support banks' market share, pricing power and profitability," Moody's Senior Vice President David Beattie said in the report.

Still, several executives stressed that their focus is organic growth.

"[W]e're focused on organic growth in the marketplace, and assets are still pretty expensive," Royal Bank of Canada President and CEO David McKay said during an earnings call. He added that the company would only consider a deal "if it fits and it's the right price and can drive a shareholder return."

TD Bank CEO Masrani said much the same, pointing to opportunities to invest in its current businesses but leaving open the option of doing a deal "if [it makes] financial and risk ... and strategic sense."

CIBC CFO Kevin Glass, meanwhile, noted that his bank will continue to focus on growth from the U.S. and generate recurring revenue streams by "leveraging relationships across [the company]."

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