Three major Canadian banks presented cautiously optimistic views on the economy, in stark contrast to the concerns raised by numerous smaller businesses dealing with the impact of a full-fledged trade war with the United States. Royal Bank of Canada, Toronto-Dominion Bank, and CIBC released their financial results prior to the opening of the Toronto Stock Exchange on Thursday.
These banking giants collectively manage assets totaling up to $6 trillion, including significant portfolios of loans and debt products. With extensive networks in both Canada and the U.S., they are well-positioned to observe the effects of tariffs on various sectors.
RBC’s CEO Dave McKay highlighted the resilience of the Canadian economy, citing improvements in employment and GDP in the second quarter. He expressed a cautiously optimistic outlook for continued expansion, noting that the average effective tariff rate remains low and the majority of exports remain duty-free.
TD Bank’s CEO Raymond Chun referred to a potential “super cycle” of investment in Canada, driven by government spending on infrastructure and defense. He mentioned over $1 trillion in approved projects by Ottawa and the provinces through 2035, signaling ongoing investment opportunities despite trade tensions.
CIBC’s CEO Harry Culham expressed confidence in the latter part of 2026, emphasizing the bank’s vigilant monitoring of the evolving trade environment and potential impacts on the labor market. A study by Oxford Economics for the Canadian American Business Council warned of potential job losses if the Canada-U.S.-Mexico Agreement were to be eliminated.
BMO Capital Markets predicted a slight decrease in Canadian growth due to the latest round of U.S. tariffs, primarily affecting business confidence and investment. National Bank’s CEO Laurent Ferreira praised Canada’s economic resilience and government initiatives to support affected workers and businesses, particularly highlighting recent investment plans and aid measures.
The CEOs of Bank of Montreal and Scotiabank separately described the Canada-U.S. trade war as manageable. Despite these challenges, shares of Canada’s major banks continue to trade near record highs on the Toronto Stock Exchange, with the BMO Equal Weight Banks Index ETF surging approximately 50% over the past year.