Three major Canadian banks presented cautiously optimistic views on the economy on Thursday, in stark contrast to the worries expressed by many small businesses dealing with the impacts of a full-fledged trade war with the United States. Royal Bank of Canada, Toronto-Dominion Bank, and CIBC released their financial results before the opening bell on the Toronto Stock Exchange. Together, these banking giants manage assets totaling up to $6 trillion. With extensive portfolios that include mortgages, auto loans, and various other debt products, these institutions have a unique position to observe the effects of tariffs, given their widespread client networks in Canada and the U.S.
RBC CEO Dave McKay expressed confidence in the resilience of the Canadian economy during the bank’s quarterly conference call, citing improvements in employment and GDP in Q2. He emphasized a cautious optimism that the economy will continue its growth trajectory despite ongoing trade uncertainties. TD Bank CEO Raymond Chun highlighted an emerging “super cycle” of investment in Canada, driven by government spending on infrastructure and national defense. According to TD Economics, there are over $1 trillion in approved projects by Ottawa and the provinces through 2035, signaling substantial investment opportunities.
CIBC CEO Harry Culham expressed measured confidence in the latter half of 2026, acknowledging the evolving trade environment and refraining from speculating on its future trajectory. CIBC’s chief risk officer, Frank Guse, emphasized the bank’s close monitoring of Canada’s labor market for any signs of weakness. Studies have suggested that over 100,000 Canadian jobs could be at risk if the Canada-U.S.-Mexico Agreement (CUSMA) were to be eliminated. BMO Capital Markets projects that the recent U.S. tariffs could shave about half a percentage point off Canadian growth, primarily due to reduced business confidence and investment.
National Bank’s CEO Laurent Ferreira praised Canada’s economic resilience over the past 18 months, pointing to the government’s large-scale investment plans and aid measures for businesses affected by tariffs. He commended initiatives such as energy and power infrastructure projects and the federal commitment to construct six icebreaker ships in Quebec. The CEO also welcomed the decision by the Office of the Superintendent of Financial Institutions to lower the domestic stability buffer, allowing banks greater flexibility in supporting struggling businesses.
Bank of Montreal and Scotiabank’s CEOs separately deemed the Canada-U.S. trade war as manageable earlier in the week. Despite trade tensions, shares of Canada’s major banks on the Toronto Stock Exchange remain near all-time highs. The BMO Equal Weight Banks Index ETF, which includes a range of Canadian bank stocks, has surged by almost 50% over the past year, reflecting investor confidence in the sector’s performance.
