Laurentian Bank of Canada

Welcome to the Laurentian Bank Quarterly Financial Results Call. Please note that this call is being recorded. I would now like to turn the meeting over to Raphael Ambeau, Head, Investor Relations. Please go ahead, Raphael.

Bonjour à tous. Good morning, and thank you for joining us. Today's opening remarks will be delivered by Eric Prevost, President and CEO, and the review of the second quarter financial results will be presented by Yvan Deschamps, Executive Vice President and CFO, after which we'll invite questions from the phone. Also joining us for the question period is Christian Debroux, Executive Vice President and CRO. All documents pertaining to the quarter can be found on our website in the Investor Relations section. I'd like to remind you that during this conference call, forward-looking statements may be made. and it is possible that actual results may differ materially from those projected in such statements. For the complete cautionary note regarding forward-looking statements, please refer to our press release or to slide 2 of the presentation. I would also like to remind listeners that the Bank assesses its performance on a reported and adjusted basis and considers both to be useful in assessing underlying business performance. Eric and Yvan will be referring to adjusted results in their remarks, unless otherwise noted, as reported.

I will now turn the call over to Eric. Good morning and thank you for being with us today. As we mark the one-year anniversary of our strategic plan, I'm proud to share that Laurentian Bank has remained focused and disciplined in executing the priorities we set up. We've taken meaningful steps to transform our organization and are making steady progress towards generating efficiency. While we're still in the early stages, we are satisfied with the progress we have made and are encouraged by the sustained execution we've demonstrated so far. Our investment in technology is a key priority in our strategic plan. Thanks to the hard work and dedication of our team throughout the year, we've made real strides towards improving efficiency, strengthening our technology infrastructure, and enhancing the customer experience. We're focused on the areas where we can truly make an impact. That's why we're continuing to grow our presence in specialized commercial sectors while also maintaining a solid base in personal deposits. Within capital markets, we're concentrating on fixed income and foreign exchange areas where we've built solid expertise. I'm incredibly proud of the progress we've made, and I'm excited to keep working alongside our talented and committed team. As we continue to build on this momentum, we remain mindful of the broader environment in which we operate. We're actively monitoring a range of factors, market trends, and policy changes, as well as broader macroeconomic shifts that could affect our customers, and as always, we're prepared to adapt as needed. While uncertainty remains and we recognize that some sectors may be more impacted than others, I want to emphasize that Laurentian Bank is in a strong financial position. We have consistently maintained excellent credit performance across economic cycles. Our portfolio continues to perform well and has proven resilient. Our conviction remains unchanged and we are well positioned to continue executing with confidence. Looking at our loan performance, commercial loans grew by 1% compared to the previous quarter, reflecting our continued strategic focus on growing commercial assets, which remains central to our long-term plan. Our commercial assets now make up 49% of the total, and our net interest margin has remained stable at 1.85% quarter over quarter. As for inventory financing, the utilization rate increased slightly to 46% in Q2, still below historical levels. That said, we saw a continued momentum in dealer onboarding during the quarter, with a growth of 2% compared to last quarter. So far this spring, our dealers have seen healthy activity and we anticipate typical seasonal trend in the summer months with inventory levels lowering as consumer demand drive sales. In the commercial real estate portfolio, the market has been slow for the past few quarters and remains quiet. However, our unfunded pipeline continues to build momentum growing 9% quarter over quarter and 28% year over year. We believe our partners are eager to start projects and are ready to move forward, but they are still waiting for the right timing. We're optimistic that our pipeline will convert into 2026. From our client perspective, our commercial banking net promoter score, which measures customer satisfaction, remained in the excellent category. This demonstrates that we are consistently delivering strong value-added solutions through our specialized approach. On the personal banking side, we're continuing to build on the momentum from Q1 and are seeing positive consumer sentiment supported by our renewed focus on customer service. All in all, we're staying true to our commitments. growing a commercial banking business that plays to our strengths, expanding into key areas of opportunity and doing it while keeping customer satisfaction front and center. During the quarter, we continued to invest in our strategic priorities, which resulted in an adjusted efficiency ratio of 75.2%. As we mentioned in previous quarters, We anticipate these elevated expenses to continue throughout the remainder of the year. It's important to highlight that these investments are crucial for the successful execution of our strategic plan and for advancing our technology initiatives. In the medium term, these efforts will position us for sustained growth and help us achieve our financial targets. Finally, We continue to maintain a strong position in both liquidity and capital, providing us with the financial stability necessary to manage current macroeconomic challenges and stay aligned with our strategic goals. With that, I'll now pass the call over to Yvan, who will walk us through our financial performance.