National Bank of Canada

ladies and gentlemen thank you for standing by my name is krista and i will be your conference operator today at this time i would like to welcome you to the national bank of canada first quarter 2026 results conference call all lines have been placed on mute to prevent any background noise after the speaker's remarks there will be a question and answer session if you would like to ask a question at that time Simply press star, then the number 1 on your telephone keypad. And if you'd like to withdraw your question, again, press star 1. Thank you. I would now like to turn the conference over to Marianne Roddy. Please go ahead.

Merci and welcome, everyone. We will begin the call with remarks from Laurence Ferreira, President and CEO, Marie-Chantal Gingras, CFO, and Jean-Sebastien Grisey, Chief Risk Officer. Our business heads are also present for the Q&A session, including Julie Lévesque, personal banking, Judith Menard, commercial and private banking, Nancy Paquette, wealth management, Etienne Dubuc, capital markets, and Bill Bonnell, international. Before we begin, please refer to slide two of our presentation for forward-looking statements and non-GAAP measures. Management will refer to adjusted results unless otherwise noted. I will now pass the call to Laurent.

Merci, Marianne, and thank you everyone for joining us. For the first quarter of 2026, we generated EPS of $3.25, representing an 11% year-over-year increase. Our results were driven by strong performance across our retail and business segments, as well as cost and funding synergies related to the CWB transaction and share buybacks. We generated a return on equity of 16.6%, And our CET1 ratio is solid at 13.7%. This morning, we announced that we are upsizing our NCIB to repurchase up to 14.5 million shares from 8 million currently pending regulatory approval. To date, we have repurchased 6.4 million shares under our program. Earlier this month, we closed the syndicated loan transaction with Laurentian Bank. The retail SME portfolios are on track to close by late 2026, subject to regulatory approvals. Our capital deployment priorities are to drive organic business growth and operational efficiency, and to grow dividends at sustainable levels. This will be complemented by share buybacks and, depending on opportunities, selective tuck-in acquisitions in P&C and wealth. We want to operate with strong capital levels and continue to target a CET1 ratio converging towards 13% by the end of 2027. Turning to our economic outlook, the geopolitical and economic backdrop continues to weigh on the economy. We are far from our GDP potential. Trade tensions and uncertainty around Kuzma are affecting our country and business investment has slowed down. Our economy must take a different strategic direction and go through structural changes. We are encouraged by our government's actions and by momentum across the country to re-establish our economic sovereignty. We are particularly pleased to see concrete actions towards our re-industrialization, including Canada's initiative to welcome the Defence Security and Resilience Bank, as well as the announcement of Canada's Defence Industrial Strategy. Turning now to our business segments. With revenues of more than $1.5 billion and net income of $442 million, PNC Banking delivered strong performance in Q1. We executed on CWB's integration with a focus on client transition and are realizing on cost and funding synergies. And we have also made early gains on revenue synergies from capital market solutions. Our balance sheet is growing. Personal mortgages grew 3% sequentially, a strong start against a mid-single-digit growth target for 2026. Commercial loans grew 1% sequentially, and we still expect to start growing the CWB portfolio in the second half of the year. Net income in our wealth management segment increased 13% year-over-year to $274 million, supported by strong growth in fee-based and transaction revenues. Asset under administration grew 3% sequentially to reach close to $900 billion with resilient equity markets and strong net sales. Capital markets generated net income of $443 million, up 6% year-over-year, driven by strong contributions from both our trading and non-trading businesses. In global markets, our strong performance in equities was supported by opportunities in securities finance and elevated issuances in structured products. We continue to see steady opportunities in our rates and credit business as expected. Meanwhile, corporate activity supported by strong equity and debt issuances and banking revenues in our CIB franchise. CreditG delivered net income of $47 million with average assets up 9% year-over-year and 1% sequentially, as we continue to benefit from recurring flows from established partnerships. We remain highly disciplined in pursuing new deals given the prevailing competitive market dynamics and pricing conditions. At ABA Bank, net income increased 9% year-over-year, reflecting balance sheet growth and a build in performing PCLs. Revenues were up 13% over the same period, with deposits and loans up 18% and 11%, respectively. I will now pass the call to Marie-Chantal.