National Bank Of Canada · TSX:NA
National Bank Of Canada — Q2 2025 Earnings Presentation
41 slides from National Bank Of Canada's earnings presentation, May 28, 2025
Slide 1: Investor Presentation Second Quarter 2025
INVESTOR PRESENTATION Second Quarter 2025 May 28, 2025
Slide 2: Forward-looking statements
Certain statements in this document are forward-looking statements. These statements are made in accordance with applicable securities legislation in Canada and the United States. The forward-looking statements in this document may include, but are not limited to, statements in the messages from man
Slide 3: We closed the acquisition of Canadian Western Bank
▪ We closed the acquisition of Canadian Western Bank “CWB” on February 3, 2025 (the “CWB Transaction”) ▪ We present information on a Consolidated Basis and, selectively, exclude any impact from the CWB Transaction - Total Bank: Refers to Consolidated Results - CWB Transaction Impact: Refers to incre
Slide 4: Overview
OVERVIEW Laurent Ferreira President & Chief Executive Officer
Slide 5: Well-diversified earnings power
Well-diversified earnings power ▪ Diluted EPS: Reported $2.17 | Adjusted(1) $2.85 ▪ Strong contribution to our Q2 results CWB Transaction creates ▪ Integration advancing well and client migration set to begin this summer long-term value ▪ Ahead of schedule to achieve cost & funding synergies ▪ Stron
Slide 6: Segment revenue growth
P&C Banking (YoY Revenue Growth) ▪ Revenue growth reflects the CWB Transaction and solid loan growth (Reported | Excluding CWB) ▪ Personal mortgages: Up 13% YoY(1) (Excluding CWB up 4%) ▪ Commercial loans: Up 64% YoY(1) (Excluding CWB up 14%) + 25% | 4% Wealth Management (YoY Revenue Growth) ▪ Stron
Slide 7: Financial Review
FINANCIAL REVIEW Marie Chantal Gingras Chief Financial Officer and Executive Vice-President, Finance
Slide 8: Q2 2025 Performance – Total Bank
▪ Revenues grew significantly YoY: Q2 2025 Performance – Total Bank - Strong organic growth across all business segments, ($MM) including record Financial Markets performance - Excluding CWB, revenues up 22% YoY Reported Adjusted(1) $ YoY $ YoY - CWB Transaction added $298MM to revenues, including:
Slide 9: Reported NII and NIM
Reported NII and NIM(1) ($MM; NIM on Average Interest-Bearing Assets) ▪ Reported net interest income and margin 268 1,205 reflect the financing costs to support trading (17) activity growth(3) 972 954 769 784 635 635 0.62% Q2 24 769 0.71% Q3 24 784 0.71% Q4 24 972 0.84% Q1 25 Q2 25 Excluding CWB 287
Slide 10: Loans and Deposits
Loans(1) ($B) YoY YoY Total loans of $286B(1), up 22% YoY +6% +22% (Excluding CWB up 6% YoY) 36.7 ▪ Personal banking: +12% YoY 285.7 - Excluding CWB: +4% YoY 239.5 243.0 246.6 249.0 234.8 ▪ Commercial banking: +63% YoY - Excluding CWB: +14% YoY ▪ Corporate banking: (6%) YoY Q2 24 Q3 24 Q4 24 Q1 25 Q
Slide 11: CET1 Ratio
CET1 Ratio(1) ▪ Robust CET1 ratio of 13.4% - The CWB Transaction reduced CET1 ratio 0.68% by 9 bps at close (0.27%) - Strong capital generation (41 bps) 13.57% (0.09%) (0.36%) (0.06%) (0.06%) 13.41% (2) Q1 25 CWB Net Dividends RWA Specified Other Q2 25 Day 1 Income ex. FX Items(3) (2)(3) Impact Adju
Slide 12: Cost and Funding Synergies
Cost and Funding Synergies ($MM, as at April 30, 2025) Tracking ahead of our plan to deliver $270MM (pre-tax) of cost and funding synergies by end of F2027 $115 ▪ Realized synergies of $27MM since close, representing $115MM on an annualized 3 Year Target: basis(2) or 43% of our 3-year target ~ $270M
Slide 13: Strong earnings growth and outlook
▪ Medium-term growth objective for adjusted EPS(1): 5-10% Strong earnings growth ▪ FY 2025 adjusted EPS(1) outlook : Mid-single digit growth excluding the amortization of the net fair value mark(2) ▪ Medium-term objective for adjusted ROE(1)(3): 15-20% Superior ROE ▪ FY 2025 adjusted ROE(1) outlook
Slide 14: Risk Management
RISK MANAGEMENT Jean-Sébastien Grisé Executive Vice-President and Chief Risk Officer
Slide 15: PCL
PCL Q2 Total PCL ($MM) ▪ Reported total PCL of $545MM (79 bps), reflecting CWB initial provision of $230MM (33 bps) ▪ Adjusted total PCL(1) of $315MM (45 bps), reflecting (1) (3) resilient portfolio mix and prudent provisioning (1) Q2 PCL on Impaired Loans (excl. Credigy’s POCI loans) ▪ PCL of $219M
Slide 16: ACL
ACL ($MM) Total Allowances ▪ 2.6x pre-pandemic level ▪ Total Allowances Cover 5.7x NCOs(1) ▪ Maintaining a prudent level of allowances in light of continued uncertainties Performing Allowances: +$315MM QoQ ▪ +$230MM from CWB initial provision ▪ +$85MM mainly from model calibration and (1) (4) macroe
Slide 17: Gross Impaired Loans excl. Credigy's POCI Loans
Gross Impaired Loans (GIL) excl. Credigy’s POCI Loans(1) ▪ Gross impaired loans (excl. Credigy’s POCI loans) of $2,805MM, increase of 19 bps QoQ ($MM) at 98 bps - GIL excl. CWB: 86 bps - GIL excl. CWB and USSF&I(2): 54 bps (up 5 bps QoQ) ▪ Net formations of 33 bps, up 16 bps QoQ primarily driven by
Slide 18: Canadian Distribution by Province
(As at April 30, 2025) Canadian Distribution by Province ▪ Uninsured mortgages and HELOC in GTA and GVA represent 12% and 3% of the total RESL 51% portfolio and have an average LTV(1) of 55% ▪ Uninsured mortgages and HELOC for condos represent 9% of the total RESL portfolio and 79% 31% Uninsured & H
Slide 19: Canadian Mortgages Distribution by Rate Type
(As at April 30, 2025) Canadian Mortgages Distribution by Rate Type ▪ ~75% of our Canadian Mortgage portfolio has been repriced, absorbing the impact of rate increases - 28% of mortgage portfolio is variable rate and the Variable monthly payments are adjusted Rate 28% - 65% of FRM have already renew
Slide 20: Appendices
APPENDICES
Slide 21: Q2 2025 Summary Results – Total Bank
│ Q2 2025 Summary Results – Total Bank ($MM) ▪ Strong ROE (1) Reported Results Adjusted Results Q2 25 Q1 25 Q2 24 QoQ YoY Q2 25 Q1 25 Q2 24 QoQ YoY ▪ Positive operating leverage Revenues 3,650 3,183 2,750 15% 33% 3,650 3,230 2,750 13% 33% Non-Int. Expenses 1,942 1,646 1,472 18% 32% 1,800 1,620 1,472
Slide 22: Q2 2025 Summary Results – Excluding CWB
│ Q2 2025 Summary Results – Excluding CWB(1) ($MM) ▪ Robust organic growth (2) Reported Results Adjusted Results Q2 25 Q1 25 Q2 24 QoQ YoY Q2 25 Q1 25 Q2 24 QoQ YoY ▪ Positive operating leverage Revenues 3,352 3,183 2,750 5% 22% 3,352 3,230 2,750 4% 22% Non-Int. Expenses 1,719 1,646 1,472 4% 17% 1,6
Slide 23: Q2 2025 – P&C Banking
│ Q2 2025 – P&C Banking ($MM) ▪ Strong contribution from CWB Transaction (1) Reported Results Adjusted Results Q2 25 Q1 25 Q2 24 QoQ YoY Q2 25 Q1 25 Q2 24 QoQ YoY - CWB added $240MM in Revenues 1,416 1,204 1,131 18% 25% 1,416 1,204 1,131 18% 25% revenue to P&C, with a Personal 676 662 624 2% 8% 676
Slide 24: Q2 2025 – P&C Banking Excluding CWB
│ Q2 2025 – P&C Banking Excluding CWB(1) ($MM) ▪ Revenues up 4% YoY, mainly from balance Q2 25 Q1 25 Q2 24 QoQ YoY sheet growth Revenues 1,176 1,204 1,131 (2%) 4% - Average loans up 8% YoY and average Personal 648 662 624 (2%) 4% deposits up 2% YoY Commercial 528 542 507 (3%) 4% Non-Interest Expense
Slide 25: Q2 2025 – Wealth Management
│ Q2 2025 – Wealth Management ($MM) ▪ Revenues of $791MM, up 16% YoY Reported Results Adjusted Results(1) - Strong fee-based revenues, up 19% YoY, Q2 25 Q1 25 Q2 24 QoQ YoY Q2 25 Q1 25 Q2 24 QoQ YoY mainly reflecting market appreciation, solid Revenues 791 776 683 2% 16% 791 776 683 2% 16% net sales
Slide 26: Financial Markets Summary Results – Q2 2025
│ Financial Markets Summary Results – Q2 2025(1) ($MM) ▪ Net income of $501MM Q2 25 Q1 25 Q2 24 QoQ YoY Revenues 1,101 907 681 21% 62% ▪ Global Markets revenues of $784MM Global Markets 784 595 369 32% 112% - Strong performance from Equities and Rates, C&IB 317 312 312 2% 2% driven by market activit
Slide 27: Credigy Summary Results – Q2 2025
│ Credigy Summary Results – Q2 2025 (US$ MM) ▪ NII up 4% YoY, driven by asset growth and Q2 25 Q1 25 Q2 24 QoQ YoY strong performance of the portfolio Revenues 100 102 100 (2%) - - Q2 2024 Non-interest income of $7MM reflected Net Interest Income 97 99 93 (2%) 4% a gain on the sale of a loan portfol
Slide 28: ABA Summary Results – Q2 2025
│ ABA Summary Results – Q2 2025 (US$ MM) ▪ Net income up 10% YoY Q2 25 Q1 25 Q2 24 QoQ YoY Revenues 176 174 153 1% 15% ▪ Loans up 7% and deposits up 21% YoY, with Non-Interest Expenses 55 59 54 (7%) 2% client base up 33% Pre-Tax / Pre-Provisions 121 115 99 5% 22% - Benefiting from leading position i
Slide 29: Other Segment Summary Results – Q2 2025
│ Other Segment Summary Results – Q2 2025 ($MM) ▪ Reported results reflect items related to our Reported Results Adjusted Results (1) acquisition of CWB(3) Q2 25 Q1 25 Q2 24 Q2 25 Q1 25 Q2 24 Revenues (48) (109) (95) (48) (62) (95) ▪ Adjusted results reflect: Non-Int. Expenses 142 74 40 28 48 40 (2)
Slide 30: Loan Distribution by Borrower Category
│ Loan Distribution by Borrower Category(1) (in $B) (As at April 30, 2025) NBC ▪ Secured lending accounts for 96% of Retail (excluding loans CWB) CWB NBC % of Total Retail ▪ Indirect auto loans represent 2.4% of total Secured - Mortgage & HELOC 107.8 7.0 114.8 40% loans ($6.8B). Secured - Other (2)
Slide 31: Geographic distribution
│ Geographic distribution (As at April 30, 2025) Within the Canadian loan portfolio: British Quebec Ontario Columbia Alberta Others Total ▪ Limited exposure to unsecured consumer Retail loans (2.3%) Secured Mortgage & HELOC 20.9% 12.7% 2.6% 3.3% 1.9% 41.4% Secured Other 1.7% 1.5% 0.6% 0.3% 0.5% 4.6%
Slide 32: Strong Performing ACL Coverage
│ Strong Performing ACL Coverage Total Allowances Cover 5.7x NCOs Performing ACL / LTM PCL on Impaired Loans (1) Total ACL / LTM Net Charge-Offs (excluding Credigy’s POCI loans) (2) ABA: Historical PCL and NCOs (Bps) Strong Total ACL Coverage Total ACL / Total Loans (excluding POCI and FVTPL) 2020 2
Slide 33: Total Portfolio by Sector ($42.9B)
│ Total Portfolio by Sector ($42.9B) (As at April 30, 2025) Corporate Banking (4%) ▪ Primarily diversified Canadian REIT Short Term Construction (28%) ▪ Mix of residential construction, land and contractors ▪ Less than 10% of exposure to High Rise condos in GTA/GVA ▪ No US exposure Commercial Bankin
Slide 34: Daily Trading and Underwriting Revenues vs. VaR
APPENDIX 12 | DAILY TRADING AND UNDERWRITING REVENUES VS. VAR ($MM) Februbry, 2025 March, 2025 April, 2025 cows Trading P&L ——=Trading VaR 34| i
Slide 35: Balance Sheet Overview
│ Balance Sheet Overview ($B, as at April 30, 2025) Balance sheet reflects our diversified business $536 $536 model Business & Business & ▪ Core banking activities well-funded through Government Loans 128 (2) Government Deposits 172 diversified and resilient sources - Diversified deposit base, inclu
Slide 36: Canada Real GDP and Macroeconomic Forecast
│ Canada Real GDP(1) Macroeconomic Forecast: Q2 25 vs. Q1 25(1) ($ Trillions) (Full Calendar Years) Base Scenario C2025 C2026 2.60 Real GDP (Annual Average % Change) As at January 31, 2025 1.4 % 1.5 % 2.50 As at April 30, 2025 1.1 % 0.9 % 2.40 Unemployment Rate (Average %) As at January 31, 2025 7.0
Slide 37: Accounting Considerations Related to the Acquisition of CWB
│ Accounting Considerations Related to the Acquisition of CWB - Preliminary Estimates and Subject to Final PPA(1) Estimated P&L impact P&L treatment (2) (in $MM, unless otherwise noted) Amount Comments Quarterly EPS Period Adjusted Not Adjusted $ (0.03) Q2'25 X Amortized using the Effective $ (0.05)
Slide 38: CWB acquisition fair value of assets and liabilities
│ ($MM) (1) Includes $10,021 million of residential mortgage loans, $476 million of personal loans, $36 million of credit card receivables and $27,285 million of business and government loans. The fair value of loans reflects estimates of incurred and expected future credit losses as at the acquisit
Slide 39: CWB Transaction impact definitions
│ (1) Refers to the CWB Transaction’s contribution to results following closing of the acquisition. Results presented under this headline are not representative of CWB’s prior reporting basis as they reflect the Bank’s presentation methodology, including but not limited to the PPA and Fund Transfer
Slide 40: Reconciliation of reported and adjusted results
│ ($MM, except EPS) Q2 25 Q1 25 Non- Non- Total Income Net Diluted Total Income Net Diluted Interest PTPP(8) PCL Interest PTPP(8) PCL Revenues taxes Income EPS Revenues taxes Income EPS Segment Expenses Expenses Reported Results 3,650 1,942 1,708 545 267 896 $2.17 3,183 1,646 1,537 254 286 997 $2.78
Slide 41: Investor Relations Contact Information
Investor Relations Contact Information W: —www.nbc.ca/investorrelations a) investorrelations@nbc.ca
National Bank of Canada — Q2 2025 Earnings Presentation on 6ix