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Bank of Nova Scotia "Absence of Balance Sheet Growth Remains an Issue," TD Says

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TD Securities maintained a Hold rating and $112 price target on Bank of Nova Scotia after it reported Q2 results before market open on Wednesday.

TD analyst Mario Mendonca said the impact is positive for BNS.

"Came away feeling slightly better about near-term earnings momentum, but absence of balance sheet growth remains an issue," Mendonca said in a note to clients.

"BNS beat EPS estimates in CAD Banking (NIM and operating leverage) and International (NIM)," the analyst said. "Capital markets were slightly softer than expected, although still up 11% y/y."

"Capital generation was good and the bank continues to buy back stock," Mendonca said. "Growth remains a challenge for the bank, particularly in International commercial. Pivot to growth expected later in '26."

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