Montreal, Quebec – August 29, 2025 – National Bank of Canada (TSX: NA) reported a 3% increase in third-quarter net income to $1.07 billion ($1,065 million), driven by robust revenue growth and the early synergies from its $5 billion acquisition of Canadian Western Bank (CWB), which closed in February 2025. The results, announced on August 27, highlight the bank’s expanding footprint in Western Canada and resilience amid economic headwinds like tariff uncertainties and a softening labor market. President and CEO Laurent Ferreira emphasized the “strong revenue fundamentals and credit performance, combined with synergy momentum from the CWB acquisition,” as key factors behind the performance. Adjusted net income for the nine-month period ended July 31, 2025, rose 19% to $3.32 billion, reflecting disciplined expense management and growth across segments. Shares rose 1.2% in early trading following the release, trading at $150.41 on the TSX.
The CWB integration, now six months in, has already delivered $69 million in annualized cost and funding synergies—64% of the three-year $270 million target—with the first wave of client migrations completed in early August. The deal added $37 billion in loans and 39 branches, primarily in British Columbia and Alberta, boosting National Bank’s presence outside Quebec from three branches per province to a more competitive network. Ferreira noted that the acquisition positions the bank as a stronger national player, enhancing services for commercial and retail clients while maintaining regional expertise.
Q3 Financial Highlights: Revenue Up 15%, Loans Grow 20%
National Bank’s Q3 results showcased broad-based strength, with revenue climbing 15% to $3.45 billion from $3.00 billion a year ago, partly fueled by $284 million from CWB operations. Diluted earnings per share (EPS) dipped 11% to $2.58 from $2.89, reflecting higher provisions for credit losses (PCL) and one-time integration costs, but adjusted EPS held steady at $2.68. Return on equity (ROE) fell to 13.6% from 18.4%, and the efficiency ratio worsened to 55.8% from 51.4%, impacted by elevated expenses.
Key segment performances included:
- Personal & Commercial Banking: Net income up 1% to $370 million, with revenue surging 21% to $1.45 billion (CWB contributed 19% or $228 million). Loans grew 20% year-over-year to $292.7 billion, and deposits rose 21% to $402.3 billion.
- Wealth Management: Net income increased 12% to $244 million on 13% revenue growth to $811 million, driven by higher fee-based revenues (up 18%) and positive net inflows. Assets under administration reached $818 billion (up 10%), and assets under management hit $183 billion (up 22%).
- Financial Markets: Net income rose 5% to $334 million, with revenue up 13% to $777 million, benefiting from increased client activity and net interest income (up 7%).
- U.S. Specialty Finance & International: Net income advanced 13% to $178 million on 11% revenue growth to $402 million.
- Other Segment: Posted a $61 million net loss, compared to $26 million last year, mainly due to CWB-related items.
Provisions for credit losses totaled $203 million, up from $149 million a year ago and $208 million in Q2, reflecting a cautious stance amid economic strains. The bank’s residential mortgage portfolio expanded to $78.1 billion (up 21% year-over-year), with about half of fixed-rate mortgages renewing in the next two years at an average 11% payment increase. The home equity line of credit (HELOC) portfolio grew to $30.8 billion. Impaired provisions rose but remain below pre-pandemic levels, supported by strong employment and savings rates.
Balance sheet metrics remained solid, with the Common Equity Tier 1 (CET1) capital ratio at 13.9% (up from 13.7% last year) and the leverage ratio at 4.7% (up from 4.4%). The board declared a quarterly dividend of $1.18 per share, payable November 1, 2025, to shareholders of record September 29, 2025, and approved a normal course issuer bid (NCIB) to repurchase up to 8 million shares (about 2% of outstanding), pending regulatory approval.
| Key Metric | Q3 2025 | Q3 2024 | Change |
|---|---|---|---|
| Net Income | $1.07B | $1.03B | +3% |
| Revenue | $3.45B | $3.00B | +15% |
| Diluted EPS | $2.58 | $2.89 | -11% |
| Adjusted EPS | $2.68 | $2.68 | Flat |
| PCL | $203M | $149M | +36% |
| CET1 Ratio | 13.9% | 13.7% | +0.2 pts |
| ROE | 13.6% | 18.4% | -4.8 pts |
Source: National Bank of Canada Q3 2025 Earnings Report
CWB Integration: On Track for Full Synergies by 2027
The $5 billion all-stock acquisition of CWB, announced in June 2024 and closed on February 3, 2025, has been a cornerstone of National Bank’s growth strategy. It expanded the bank’s Western Canada presence, adding 65,000 clients and aligning with National’s focus on commercial banking and regional expertise. Integration milestones include the completion of CWB’s Tier 1 capital reorganization in February 2025 and the amalgamation into National Bank on March 1, 2025. CWB’s operations now operate under the National Bank brand, with no immediate changes to client services but enhanced product offerings like cash management and risk solutions.
Ferreira highlighted the deal’s momentum: “The first wave of client migrations completed in early August… We anticipate achieving our Year 1 target of $135 million in December 2025.” The acquisition has already boosted loan volumes and deposit growth, contributing to the 20% and 21% increases, respectively. Analysts view it positively, with Raymond James’ Stephen Boland calling it a “logical fit” that strengthens National’s national scale without significant overlap.
Economic Outlook and Strategic Priorities
Ferreira described the Canadian economy as “resilient but strained” by tariff uncertainties, leading to a softer labor market. Despite this, the bank expects continued growth in 2025, fueled by the CWB synergies and diversification into wealth management and U.S. operations. The mortgage portfolio’s resilience— with low delinquency rates and prudent adjustments for variable-rate clients—supports this outlook, even as renewals loom.
Looking ahead, National Bank anticipates adjusted earnings per share growth of 7-9% for fiscal 2025, with the NCIB enhancing shareholder returns. The bank’s CET1 buffer provides flexibility for further expansions. As one of Canada’s “Big Six” banks, National’s performance amid integration challenges positions it well for a complex economic environment, with the CWB deal proving a catalyst for sustained growth.