TD Bank Group Reports Second Quarter 2026 Results

TD Bank Group Reports Second Quarter 2026 Results

Earnings News Release • Three and six months ended April 30, 2026

SECOND QUARTER FINANCIAL HIGHLIGHTS, compared with the second quarter last year:

• Reported diluted earnings per share were $2.43, compared with $6.27.
• Adjusted diluted earnings per share were $2.38, compared with $1.97.
• Reported net income was $4,251 million, compared with $11,129 million.
• Adjusted net income was $4,168 million, compared with $3,626 million.

YEAR-TO-DATE FINANCIAL HIGHLIGHTS, six months ended April 30, 2026, compared with the corresponding period last year:

• Reported diluted earnings per share were $4.77, compared with $7.81.
• Adjusted diluted earnings per share were $4.82, compared with $3.99.
• Reported net income was $8,294 million, compared with $13,922 million.
• Adjusted net income was $8,384 million, compared with $7,249 million.

SECOND QUARTER ADJUSTMENTS (ITEMS OF NOTE)
The second quarter reported earnings figures included the following items of note:

• Amortization of acquired intangibles of $33 million ($25 million after tax or 1 cent per share), compared with $43 million ($35 million after tax or 2 cents per share) in the second quarter last year.
• Impact from the terminated First Horizon Corporation (FHN) acquisition-related capital hedging strategy of $43 million ($33 million after tax or 2 cents per share), compared with $47 million ($35 million after tax or 2 cents per share) in the second quarter last year.
• Income tax adjustment on gain on sale of The Charles Schwab Corporation (Schwab) shares of ($288) million (($288) million after tax or (17) cents per share).
• Change in partnership share in the U.S. strategic cards portfolio of $197 million ($147 million after tax or 9 cents per share).

TORONTO, May 28, 2026 /CNW/ - TD Bank Group ("TD" or the "Bank") today announced its financial results for the second quarter ended April 30, 2026. Reported earnings and earnings per share were $4.3 billion and $2.43, compared with $11.1 billion and $6.27, respectively, in the second quarter last year. Adjusted earnings and earnings per share were $4.2 billion and $2.38, up 15% and 21%, respectively, year-over-year.

"This was another strong quarter for TD. We drove record Q2 earnings in Canadian Personal and Commercial Banking, all-time high earnings in Wealth Management and Insurance and Wholesale Banking, and we accelerated momentum in U.S. Banking. We demonstrated disciplined execution as we grew return on equity and delivered our fourth consecutive quarter of positive operating leverage, on an adjusted basis. We also continue to make consistent progress on our AML remediation and enhancements, which remain our top priority," said Raymond Chun, Group President and CEO, TD Bank Group. "Our bank has momentum, and we are making important investments in talent, innovation, AI and client experience, as we fundamentally restructure our cost base to drive performance and continue winning."

Canadian Personal and Commercial Banking delivered record Q2 revenue and earnings
Canadian Personal and Commercial Banking net income was $1,925 million, up 15% year-over-year, primarily reflecting higher revenue and lower provisions for credit losses (PCL). Revenue grew 5% year-over-year driven by loan and deposit volume growth and higher margins.

Canadian Personal Banking drove continued momentum in deepening client relationships, achieving record penetration rates for consumer and small business credit cards. The business also generated $9 billion in closed referrals to Wealth, with double-digit growth year-over-year, driven by strong frontline engagement and execution. Canadian Business Banking maintained its momentum this quarter as continued progress on distribution expansion contributed to strong loan growth and earnings. TD Auto Finance was once again awarded #1 for Dealer Satisfaction among both Non-Prime and Prime Credit Non-Captive Automotive Financing Lenders in the JD Power 2026 Canada Dealer Financing Satisfaction Study¹.

U.S. Banking sustained business momentum
U.S. Banking reported net income was $813 million (US$595 million), an increase of $771 million (US$560 million) year-over-year. On an adjusted basis, net income was $960 million (US$702 million), up 8% (12% in U.S. dollars) year-over-year. The segment delivered a return on equity of 8.2% on a reported basis and 9.6% on an adjusted basis, up 770 basis points and 130 basis points year-over-year respectively, as the business continued to manage capital with discipline.

U.S. Banking performance was supported by growth across core lending portfolios², including double-digit growth year-over-year in middle market commercial lending and TD's proprietary credit card balances. In Wealth, record mass affluent sales drove double-digit asset growth year-over-year.

Wealth Management and Insurance delivered record earnings and assets
Wealth Management and Insurance net income was $837 million, up 18% year-over-year, driven by record assets, higher insurance earned premiums, and deposit volume growth.

Wealth Management launched the fully redesigned TD Easy Trade™ app, delivering a streamlined, mobile-first experience that supports the next generation of self-directed investors, offering market-leading capabilities. TD Insurance launched a client-facing generative AI powered Virtual Assistant, becoming the first Canadian home and auto insurer to deploy this capability and making it simpler for clients to connect with TD Insurance.

Wholesale Banking delivered record earnings
Wholesale Banking net income was $612 million, up 46% year-over-year on a reported basis and 38% year-over-year on an adjusted basis, reflecting higher revenues and lower PCL, partially offset by higher non-interest expenses. Revenue for the quarter was $2,393 million, up 12% year-over-year, driven by strong execution across Global Markets and Corporate and Investment Banking including strength in Equities, Capital Markets, and Lending businesses.

Wholesale Banking performance reflects the depth and diversification of the platform combined with high levels of client activity and constructive market conditions. Return on equity for the quarter was 14.5%, a significant improvement year-over-year, driven by strong revenue growth, moderating expense growth, and disciplined capital management.

Capital
TD's Common Equity Tier 1 Capital ratio was 14.3%.

Conclusion
"Our ongoing share buy-back and the dividend increase announced today reflect our confidence in TD's growth and earnings power," added Chun. "As we deepen relationships, run our bank simpler and faster, and execute with discipline, we are creating value for shareholders, supporting our clients, and opening new opportunities for growth. I want to thank our colleagues for delivering once again this quarter for TD and the more than 28 million clients we serve."

The foregoing contains forward-looking statements. Please refer to the "Caution Regarding Forward-Looking Statements" on page 3.

UPDATE ON THE REMEDIATION OF THE U.S. BANK SECRECY ACT/ANTI-MONEY LAUNDERING PROGRAM AND ENTERPRISE AML PROGRAM

As previously disclosed, on October 10, 2024, the Bank announced that, following active cooperation and engagement with authorities and regulators, it reached a resolution (the "Global Resolution") of previously disclosed investigations related to its U.S. BSA/AML program. The Bank and certain of its U.S. subsidiaries consented to orders with the Office of the Comptroller of the Currency ("OCC"), the Federal Reserve Board ("FRB"), and the Financial Crimes Enforcement Network ("FinCEN") and entered into plea agreements with the Department of Justice ("DOJ"), Criminal Division, Money Laundering and Asset Recovery Section and the United States Attorney's Office for the District of New Jersey. The full terms of the consent orders and plea agreements are available on the Bank's issuer profile on SEDAR+ at www.sedarplus.com.

The Bank is focused on meeting the terms of the consent orders and plea agreements, including meeting the requirements to remediate the Bank's U.S. BSA/AML program. In addition, the Bank is also undertaking remediation of the Bank's enterprise-wide AML/Anti-Terrorist Financing and Sanctions Programs ("Enterprise AML Program").

For additional information on the risks associated with the remediation of the Bank's U.S. BSA/AML program and the Bank's Enterprise AML Program, see the "Risk Factors That May Affect Future Results – Remediation of the Bank's U.S. BSA/AML Program and Enterprise AML Program" section of the 2025 MD&A.

Update on the Remediation of the U.S. AML Program
The Bank remains focused on remediating its U.S. BSA/AML program to meet the requirements of the Global Resolution. The Bank continues to work on its management remediation actions (the term "management remediation actions" is not a regulatory definition and is considered by the Bank to consist of the root cause assessments, data preparation, design, documentation, frameworks, policies, standards, training, processes, systems, testing and implementation of controls, as well as the hiring of resources) with significant work and important milestones remaining in calendar 2026 and calendar 2027 including the Suspicious Activity Report lookback per the OCC consent order which management expects to complete in calendar 2027. For fiscal 2026, the Bank continues to expect U.S. BSA/AML remediation and related governance and control investments to be largely in line with the previous guidance of approximately US$500 million pre-tax³. All management remediation actions will be subject to demonstrated sustainability and validation by the Bank's internal audit function (with such activities currently planned for calendar 2026 and calendar 2027), as well as the review by the appointed monitor, and, ultimately, the review and approval of the Bank's U.S. banking regulators and the DOJ. Following such independent reviews, testing, and validation, there could be additional management remediation actions that would take place after calendar 2027 in which case the overall remediation timeline may be extended. In addition, as the Bank undertakes the lookback reviews, the Bank may be required to further expand the scope of the review, either in terms of the subjects being addressed and/or the time period reviewed. The following graph illustrates the Bank's expected remediation plan and progress on a calendar year basis, based on its work to date.

The Bank's remediation timeline is based on the Bank's current plans, as well as assumptions related to the duration of remediation activities, including the completion of lookback reviews. The Bank's ability to meet its planned remediation milestones assumes that the Bank will be able to successfully execute against its U.S. BSA/AML remediation program plan, which is subject to inherent risks and uncertainties including the Bank's ability to attract and retain key employees, the ability of third parties to deliver on their contractual obligations, the successful development and implementation of required technology solutions, and data availability to complete the required lookback reviews. Furthermore, the execution of the U.S. BSA/AML remediation plan, including these planned milestones, will not be entirely within the Bank's control because of various factors such as (i) the requirement to obtain regulatory approval or non-objection before proceeding with various steps, and (ii) the requirement for the various deliverables to be acceptable to the regulators and/or the monitor. As of the date hereof, the Bank believes that it and its applicable U.S. subsidiaries have taken such actions as are required of them to date under the terms of the consent orders and plea agreements and is not aware of them being in breach of the same. For information about the Bank's AML governance framework, see the "Managing Risk" section of the Bank's 2025 Annual Report.

While substantial work remains, the Bank is making progress on remediating and strengthening its U.S. BSA/AML program as previously disclosed including continued improvements through:

1. continued maturation of transaction monitoring and investigation processes;
2. enhancements to the new Know Your Customer (KYC) platform which now includes an improved customer risk rating model and is expected to provide more accurate, timely and consistent risk assessments across U.S. Banking's client population;
3. additional enhancements to the Financial Crime Risk Management (FCRM) training program with improved controls, providing insights into training effectiveness, completion metrics, and workforce readiness;
4. improvements to front-line onboarding systems for Money Service Businesses, providing U.S. Banking employees with the ability to sustainably identify, detect and manage Money Service Businesses going forward; and
5. completion by the third-party vendor of the first population of lookback reviews.

Going forward, the Bank's focus will be on continuing to remediate and strengthen its U.S. BSA/AML program, including:

1. further deployments of the new KYC platform;
2. further deployments of machine learning and specialized AI;
3. continued data enhancements with the deployment of dedicated FCRM data environments which will create a single source of truth in support of advanced detection capabilities;
4. continued enhancements to its financial crime risk assessment methodologies and processes;
5. continued training and development of colleagues; and
6. continued execution of lookback reviews as required under the OCC and FinCEN consent orders.

Strengthening of the Bank's Enterprise AML Program
The Bank continues to undertake remediation of the Enterprise AML Program, including a range of management remediation and enhancement actions (the term "management remediation and enhancement actions" is not a regulatory definition and is considered by the Bank to consist of root cause assessments, data preparation, design, documentation, frameworks, policies, standards, training, processes, systems, testing, and execution of controls, as well as the hiring of resources). While the Bank has made progress on this remediation work, it is a multi-year endeavour and the remediation work remains ongoing. The timing of completion of the remediation work will not be entirely within the Bank's control, and is subject to regulatory feedback, internal review, challenge and validation. As previously disclosed, following the end of the first quarter of fiscal 2025, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) commenced a review of certain remediation steps that the Bank has taken to date to address the FINTRAC violations. This review is ongoing, and subject to the outcome, may result in additional regulatory actions.

The remediation and enhancement of the Enterprise AML Program is exposed to similar risks as noted in respect of the remediation of the Bank's U.S. BSA/AML Program (see also "Remediation of the U.S. BSA/AML Program" above). In particular, as the Bank continues its remediation and improvement activities of the Enterprise AML Program, it expects an increase in identification of reportable transactions and/or events, which will add to the operational backlog in the Bank's FCRM investigations processing that the Bank currently faces, but is working towards remediating, across the Bank. In addition, on an ongoing basis, the Bank will continue to review and assess whether issues identified in one jurisdiction have an impact in other jurisdictions. Furthermore, the Bank's regulators or law enforcement agencies may identify other issues with the Bank's Enterprise AML Program, which may result in additional regulatory actions. These issues identified through the Bank's own review or by the Bank's regulators or law enforcement agencies may broaden the scope of the remediation and improvements required for the Enterprise AML Program.

While substantial work remains, the Bank is making progress on remediating and strengthening the Enterprise AML Program as previously disclosed, including:

1. advanced transaction monitoring capabilities, including enhanced scenario coverage;
2. strengthened governance and first-line engagement in managing financial crime risks via dedicated governance forums; and
3. updated FCRM training standards to strengthen and align requirements globally.

Going forward, the Bank's focus will be on continuing to remediate and strengthen its Enterprise AML Program, including:

1. continued progress on clearing operational backlogs;
2. ongoing advancements in transaction monitoring capabilities; and
3. continued investment in supporting advanced analytics, machine learning, and AI opportunities within FCRM.

HOW WE PERFORMED 

ECONOMIC SUMMARY AND OUTLOOK
The global economic outlook continues to slow in calendar 2026. The conflict in the Middle East and resulting surge in oil prices has already lifted inflation and is expected to continue to put downward pressure on global growth. The conflict has also increased volatility in financial and commodity markets due to uncertainty over the duration of restricted oil flows through the Strait of Hormuz and elevated oil prices. While some economies, including parts of Europe, may see a modest pickup in economic activity from higher government spending later in the year, the near-term fallout from the oil supply crunch will remain a dominant theme weighing on growth in much of Asia and Europe.

Incoming data suggest that the U.S. economy has remained resilient despite a fluid policy backdrop. Activity through the first calendar quarter of 2026 was supported by continued AI-related capital spending (shifting from construction toward equipment and software) and a rebound in government activity after last year's shutdown. Consumer spending was a soft spot, in part reflecting bad weather and, more recently, higher gasoline prices. Looking ahead, TD Economics expects tax cuts, continued investments in AI, and a business-friendly regulatory environment to help sustain the expansion. However, the pace of growth will remain sensitive to labour market conditions, energy-price volatility and the evolution of trade policy.

Hiring in the U.S. was volatile through the first quarter of calendar 2026, but looking past the month-to-month volatility, the trend indicates job growth has picked up from an anemic pace at the end of last year alongside a stabilization in the unemployment rate. Inflation pressures have also picked up, reflecting both the pass-through from tariffs and higher energy prices. We expect core inflation to drift higher in the coming months reflecting the knock-on effects of higher energy costs. As a result, the Federal Reserve is likely to leave the federal funds rate unchanged at a range of 3.5%-3.75% this year. Should the supply shocks fade and inflation trends improve, TD Economics forecasts that the Federal Reserve would lower the policy rate towards estimates of a "neutral" level at 3.25%-3.50% in 2027. The timing and pace of interest rate moves will depend on whether job growth weakens further and whether inflationary pressures prove more persistent than expected.

Canada's economy has continued to expand at a modest pace. The impact of U.S. tariffs is evident both directly, via weaker exports in affected sectors, and indirectly, through elevated uncertainty that has tempered hiring and delayed some investment decisions. Overall, Canada's labour market has shown a lack of dynamism. So far this year, total employment has declined by a modest 28,000 per month on average. Slower population growth has reduced labour force growth, which has kept the unemployment rate in a still-elevated range of 6.5%-7%. Looking ahead in 2026, a modest improvement in the economy is expected alongside a gradual improvement in housing activity, public infrastructure and defense outlays, and some firming in business investment. However, the risks to the outlook remain highly sensitive to geopolitical events and U.S. trade policy.

The Canadian central bank has maintained a steady policy stance in 2026, keeping the overnight rate at 2.25% after substantial easing since mid-2024. TD Economics expects no change in the policy interest rate through the remainder of 2026. Due to the economy having excess supply and a weakened economic growth profile, this is expected to outweigh any near-term rise in inflation within the conditions evaluated by the Bank of Canada. Once the conflict subsides, a generally weaker U.S. dollar and a smaller gap between U.S. and Canadian short-term interest rates are expected to lift the Canadian dollar. TD Economics expects the Canadian dollar to appreciate to the 74-75 U.S. cent range by late-2026, although the outcome of U.S. trade policy will be a key determinant for timing and direction.

HOW THE BANK REPORTS
The Bank prepares its Interim Consolidated Financial Statements in accordance with IFRS, the current GAAP, and refers to results prepared in accordance with IFRS as "reported" results.

Non-GAAP and Other Financial Measures
In addition to reported results, the Bank also presents certain financial measures, including non-GAAP financial measures that are historical, non-GAAP ratios, supplementary financial measures and capital management measures, to assess its results. Non-GAAP financial measures, such as "adjusted" results, are utilized to assess the Bank's businesses and to measure the Bank's overall performance. To arrive at adjusted results, the Bank adjusts for "items of note" from reported results. Items of note are items which management does not believe are indicative of underlying business performance and are disclosed in Table 3. Non-GAAP ratios include a non-GAAP financial measure as one or more of its components. Examples of non-GAAP ratios include adjusted net interest margin, adjusted basic and diluted earnings per share (EPS), adjusted dividend payout ratio, adjusted efficiency ratio, net of ISE, and adjusted effective income tax rate. The Bank believes that non-GAAP financial measures and non-GAAP ratios provide the reader with a better understanding of how management views the Bank's performance. Non-GAAP financial measures and non-GAAP ratios used in this document are not defined terms under IFRS and, therefore, may not be comparable to similar terms used by other issuers. Supplementary financial measures depict the Bank's financial performance and position, and capital management measures depict the Bank's capital position, and both are explained in this document where they first appear.

Investment in The Charles Schwab Corporation ("Schwab") and Insured Deposit Account (IDA) Agreement
On February 12, 2025, the Bank sold its entire remaining equity investment in Schwab through a registered offering and share repurchase by Schwab. The Bank discontinued recording its share of earnings available to common shareholders from its investment in Schwab following the sale.

Prior to the sale, the Bank accounted for its investment in Schwab using the equity method. The U.S. Banking segment reflected the Bank's share of net income from its investment in Schwab. The Corporate segment net income (loss) included amounts for amortization of acquired intangibles, the acquisition and integration charges related to the Schwab transaction, and the Bank's share of restructuring and other charges incurred by Schwab. The Bank's share of Schwab's earnings available to common shareholders was reported with a one-month lag. For further details, refer to Note 12 of the Bank's 2025 Annual Consolidated Financial Statements.

Subsequent to the sale of the Bank's entire remaining equity investment in Schwab, the Bank continues to have a business relationship with Schwab through the insured deposit account agreement ("Schwab IDA Agreement").

On May 4, 2023, the Bank and Schwab entered into an amended Schwab IDA Agreement, with an initial expiration of July 1, 2034. Pursuant to the Schwab IDA Agreement, the Bank makes sweep deposit accounts available to clients of Schwab. Schwab designates a portion of the deposits with the Bank as fixed-rate obligation amounts. Remaining deposits are designated as floating-rate obligations. The IDA deposit floor is set at US$60 billion.

Refer to Note 26 of the Bank's 2025 Annual Consolidated Financial Statements for further details on the Schwab IDA Agreement.

The following table provides the operating results on a reported basis for the Bank. 

The following table provides a reconciliation between the Bank's adjusted and reported results. For further details refer to the "How We Performed" or "How Our Businesses Performed" sections of this document.

Return on Common Equity
The consolidated Bank ROE is calculated as reported net income available to common shareholders as a percentage of average common equity. The consolidated Bank adjusted ROE is calculated as adjusted net income available to common shareholders as a percentage of average common equity. Adjusted ROE is a non-GAAP financial ratio and can be utilized in assessing the Bank's use of equity.

ROE for the business segments is calculated as the segment net income as a percentage of average allocated capital. The Bank's methodology for allocating capital to its business segments is largely aligned with the common equity capital requirements under Basel III. Capital allocated to the business segments was based on 11.5% CET1 Capital.

Return on Tangible Common Equity
Tangible common equity (TCE) is calculated as common shareholders' equity less goodwill, imputed goodwill and intangibles on the investments in Schwab and other acquired intangible assets, net of related deferred tax liabilities. ROTCE is calculated as reported net income available to common shareholders after adjusting for the after‑tax amortization of acquired intangibles, which are treated as an item of note, as a percentage of average TCE. Adjusted ROTCE is calculated using reported net income available to common shareholders, adjusted for all items of note, as a percentage of average TCE. TCE, ROTCE, and adjusted ROTCE can be utilized in assessing the Bank's use of equity. TCE is a non-GAAP financial measure, and ROTCE and adjusted ROTCE are non-GAAP ratios. 

HOW OUR BUSINESSES PERFORMED

For management reporting purposes, the Bank's business operations and activities are organized around the following four key business segments: Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Insurance, and Wholesale Banking. The Bank's other activities are grouped into the Corporate segment. Effective June 1, 2026, the Bank will implement a reorganization within the Canadian Personal and Commercial Banking segment, whereby Small Business Banking will transition from Canadian Business Banking to Canadian Personal Banking. The reorganization will not impact the segment's reporting.

Results of each business segment reflect revenue, expenses, assets, and liabilities generated by the businesses in that segment. Where applicable, the Bank measures and evaluates the performance of each segment based on adjusted results and ROE, and for those segments, the Bank indicates that the measure is adjusted. For further details, refer to the "How We Performed" section of this document, the "Business Focus" section in the Bank's 2025 MD&A, and Note 27 of the Bank's Annual Consolidated Financial Statements for the year ended October 31, 2025.

PCL related to performing (Stage 1 and Stage 2) and impaired (Stage 3) financial assets, loan commitments, and financial guarantees is recorded within the respective segment.

Net interest income within Wholesale Banking is calculated on a taxable equivalent basis (TEB), which means that the value of non-taxable or tax-exempt income, including certain dividends, is adjusted to its equivalent pre-tax value. Using TEB allows the Bank to measure income from all securities and loans consistently and makes for a more meaningful comparison of net interest income with similar institutions. The TEB increase to net interest income and provision for income taxes reflected in Wholesale Banking results is reversed in the Corporate segment. The TEB adjustment for the quarter was $18 million, compared with $17 million in the prior quarter and $13 million in the second quarter last year.

The Bank's U.S. strategic cards portfolio is comprised of agreements with certain U.S. retailers pursuant to which TD is the U.S. issuer of private label and co-branded consumer credit cards to their U.S. customers. Under the terms of the individual agreements, the Bank and the retailers share in the profits generated by the relevant portfolios after credit losses. Under IFRS, TD is required to present the gross amount of revenue and PCL related to these portfolios in the Bank's Interim Consolidated Statement of Income. At the segment level, the retailer program partners' share of revenues and credit losses is presented in the Corporate segment, with an offsetting amount (representing the partners' net share) recorded in non-interest expenses, resulting in no impact to the Corporate segment's reported net income (loss). The net income included in the U.S. Banking segment includes only the portion of revenue and credit losses attributable to TD under the agreements.

Effective the first quarter of 2026, non-interest income within U.S. Banking is adjusted for the Bank's share of losses from community-based tax-advantaged investments accounted for using the equity method which are reclassified to provision for income taxes. This allows the Bank to measure the effective tax rate for U.S. Banking consistently with similar institutions. The adjustment between non-interest income and provision for income taxes reflected in U.S. Banking results is reversed in the Corporate segment. Comparative amounts have been reclassified to conform with the presentation adopted in the first quarter of 2026.

On February 12, 2025, the Bank sold its entire remaining equity investment in Schwab. Prior to the sale, the Bank accounted for its investment in Schwab using the equity method and the share of net income from investment in Schwab was reported in the U.S. Banking segment. Amounts for amortization of acquired intangibles, the acquisition and integration charges related to the Schwab transaction, and the Bank's share of restructuring and other charges incurred by Schwab were recorded in the Corporate segment. Beginning in the third quarter of fiscal 2025, the U.S. Banking segment no longer includes contributions from Schwab and consequently discussions of the U.S. Banking segment's performance exclude Schwab.

Quarterly comparison – Q2 2026 vs. Q2 2025
Canadian Personal and Commercial Banking net income for the quarter was $1,925 million, an increase of $257 million, or 15%, compared with the second quarter last year, primarily reflecting higher revenue and lower PCL. The annualized ROE for the quarter was 31.3%, compared with 28.9% in the second quarter last year.

Revenue for the quarter was $5,256 million, an increase of $265 million, or 5%, compared with the second quarter last year. Net interest income was $4,289 million, an increase of $266 million, or 7%, primarily reflecting volume growth and higher margins. Average loan volumes increased $32 billion, or 6%, reflecting 5% growth in personal loans and 7% growth in business loans. Average deposit volumes increased $12 billion, or 3%, reflecting 1% growth in personal deposits and 5% growth in business deposits. Net interest margin was 2.85%, an increase of 3 basis points (bps), primarily due to higher margins on loans and deposits, partially offset by changes in balance sheet mix. Non-interest income was $967 million, relatively flat compared with the second quarter last year.

PCL for the quarter was $498 million, a decrease of $124 million compared with the second quarter last year. PCL – impaired was $465 million, an increase of $37 million, or 9%, largely reflecting credit migration in the consumer lending portfolios, partially offset by lower provisions in the commercial lending portfolio. PCL – performing was $33 million, a decrease of $161 million compared with the second quarter last year. The performing provisions this quarter were largely driven by the consumer lending portfolios reflecting an update to the macroeconomic outlook. Total PCL as an annualized percentage of credit volume was 0.33%, a decrease of 11 bps compared with the second quarter last year.

Non-interest expenses for the quarter were $2,088 million, an increase of $36 million, or 2%, compared with the second quarter last year, primarily reflecting higher employee-related expenses.

The efficiency ratio for the quarter was 39.7%, compared with 41.1% in the second quarter last year.

Quarterly comparison – Q2 2026 vs. Q1 2026
Canadian Personal and Commercial Banking net income for the quarter was $1,925 million, a decrease of $119 million, or 6%, compared with the prior quarter, primarily reflecting the impact of fewer days in the second quarter and higher PCL. The annualized ROE for the quarter was 31.3%, compared with 32.1% in the prior quarter.

Revenue decreased $165 million, or 3%, compared with the prior quarter. Net interest income decreased $105 million, or 2%, primarily reflecting fewer days in the second quarter. Average loan volumes increased $3 billion, while average deposit volumes decreased $2 billion. Net interest margin was 2.85%, an increase of 2 bps, primarily due to higher margins on loans and deposits, partially offset by changes in balance sheet mix. As we look forward to the third quarter, based on current rate and competitive market dynamics, we expect net interest margin to be relatively stable, similar to this quarter's results⁴. Non-interest income decreased $60 million, or 6%, compared with the prior quarter, reflecting lower fee revenue.

PCL for the quarter was $498 million, an increase of $62 million compared with the prior quarter. PCL – impaired was $465 million, an increase of $41 million, or 10%, largely reflecting higher provisions in the commercial lending portfolio. PCL – performing was $33 million, an increase of $21 million compared with the prior quarter. The performing provisions this quarter were largely driven by the consumer lending portfolios reflecting an update to the macroeconomic outlook. Total PCL as an annualized percentage of credit volume was 0.33%, an increase of 5 bps compared with the prior quarter.

Non-interest expenses decreased $59 million, or 3%, compared with the prior quarter, primarily reflecting fewer days in the second quarter.

The efficiency ratio was 39.7%, compared with 39.6% in the prior quarter

Year-to-date comparison – Q2 2026 vs. Q2 2025
Canadian Personal and Commercial Banking net income for the six months ended April 30, 2026, was $3,969 million, an increase of $470 million, or 13%, compared with the same period last year, reflecting higher revenue and lower PCL, partially offset by higher non-interest expenses. The annualized ROE for the period was 31.7%, compared with 30.2% in the same period last year.

Revenue for the period was $10,677 million, an increase of $537 million, or 5%, compared with the same period last year. Net interest income was $8,683 million, an increase of $525 million, or 6%, compared with the same period last year, primarily reflecting volume growth and higher loan margins. Average loan volumes increased $32 billion, or 5%, reflecting 5% growth in personal loans and 6% growth in business loans. Average deposit volumes increased $14 billion, or 3%, reflecting 2% growth in personal deposits and 5% growth in business deposits. Net interest margin was 2.84%, an increase of 2 bps, primarily due to higher margins on loans and deposits, partially offset by changes in balance sheet mix. Non-interest income was $1,994 million, an increase of $12 million, or 1%, reflecting business growth.

PCL was $934 million, a decrease of $209 million compared with the same period last year. PCL – impaired was $889 million, an increase of $2 million, relatively flat compared with the same period last year, reflecting credit migration in the consumer lending portfolios, largely offset by lower provisions in the commercial lending portfolio. PCL – performing was $45 million, a decrease of $211 million compared with the same period last year. The current year performing provisions were largely related to credit migration in the consumer lending portfolios and volume growth, partially offset by the impact of a model update in the other personal lending portfolios. Total PCL as an annualized percentage of credit volume was 0.31%, a decrease of 8 bps compared with the same period last year.

Non-interest expenses were $4,235 million, an increase of $97 million, or 2%, compared with the same period last year, reflecting higher employee-related expenses.

The efficiency ratio was 39.7%, compared with 40.8% for the same period last year.