TORONTO, Feb. 25, 2026 /PRNewswire/ - EQB Inc. (TSX: EQB) today reported financial results for the first quarter and three months ended January 31, 2026.
-- Adjusted diluted EPS1: $2.26, +48% q/q and (24%) y/y (reported $2.11)
-- Adjusted net income1: $85.2 million, +34% q/q and (27%) y/y (reported
$79.5 million)
-- Adjusted PPPT2: $156.2 million, +9% q/q and (8%) y/y (reported $148.4
million)
-- Adjusted ROE1: 11.1%, +360 bps q/q and (410 bps) y/y (reported 10.4%)
-- Adjusted revenue1: $306.8 million, flat q/q and (5%) y/y (reported $306.8
million)
-- Adjusted net interest margin $(NIM)$1,3: 2.02%, +1 bp q/q and (8 bps) y/y
(reported 2.02%)
-- Book value per share: $81.75, +1% q/q and +3% y/y
-- Total AUM + AUA3: $142 billion, +3% q/q +8% y/y
-- EQ Bank customers: 633,000, +4% q/q and +18% y/y
-- Common share dividends declared: $0.59 per share, +4% q/q and +16% y/y
-- Capital: CET1 ratio of 13.6% and total capital ratio of 16.0%
"EQB's first quarter reflects the outcome of our refreshed strategic focus and important steps forward to challenge the market, raise the bar in banking and win for Canadians, while progressing toward our ROE objectives. We strengthened execution across our core franchise, expanded loans under management, significantly improved efficiency and maintained prudent credit provisioning," said Chadwick Westlake, President and CEO. "In every environment, we must perform and deliver differentiated choice for customers. The opportunity set for Canada's Challenger Bank is tangible and growing because Canadians deserve better options. We are energized to close our agreement to acquire PC Financial, partner with Loblaw Companies and make banking more competitive across Canada with EQ Bank."
Planned acquisition of PC Financial progressing with strong momentum
-- EQB formally filed its applications with the Office of the Superintendent
of Financial Institutions (OSFI) and the Competition Bureau of Canada in
January 2026
-- EQB established its Integration Management Office to prepare for
integration, achieve strategic benefits of the acquisition, including
revenue and expense synergies, and deliver value to Canadians in the
long-term
Efficiency ratio improvement reflects disciplined expense management
-- Proactive strategic restructuring program in Q4 2025 delivered
significant cost benefits, contributing to 9% q/q and 1% y/y decline in
adjusted expenses, respectively (reported down 39% q/q and 1% y/y); this
was achieved while EQB continued to actively invest in technology,
innovation and new capabilities as well as higher premises costs
reflecting the new Toronto headquarters
-- EQB's adjusted efficiency ratio for Q1 improved to 49.1% (reported 51.6%),
down from 53.6% in Q4 2025, demonstrating meaningful execution against
its low-50% efficiency ratio target for 2026
Delivered positive LUM growth despite dynamic operating environment
-- Commercial lending loans under management (LUM) grew 3% q/q and 19% y/y,
the latter driven by solid results in insured multi-unit residential
mortgages as demand for CMHC-insured construction loans and the
securitization market remained strong
-- Personal lending LUM was flat q/q and declined 2% y/y, driven by the
strategic decision to decelerate growth in insured single-family due to
lower margins; excluding insured single-family, personal lending LUM was
up 1% q/q and 7% y/y driven by growth in the single-family uninsured and
decumulation portfolios. The decumulation lending portfolio grew 5% q/q
and 30% y/y as EQ continued to capture market share in this rapidly
growing segment
EQ Bank welcomed new retail and business customers at an attractive rate
-- EQ Bank added 26,000 new retail and business customers in Q1 who will
benefit from its expanding shelf of everyday banking products and
continued enhancements to the Business Banking platform, including the
upcoming prepaid Business Card
-- EQ Bank deposits grew to $9.94 billion in Q1 (flat q/q and +10% y/y),
increasing to 27% of total deposit principal (up 41 bps y/y); growth was
supported by continued adoption across its everyday banking offerings
including the Personal Account and Business Banking platform, with the
Notice Savings Account standing out as a differentiated savings solution
for customers seeking more flexibility and value
-- EQ Bank products received industry recognition as customers' products of
choice including Best Savings Account in Canada from moneyGenius and Best
Online Bank Account from Milesopedia
Prudent provisioning materially improved PCLs in line with robust risk management approach
-- EQB's provision for credit losses $(PCL)$ declined 28% q/q, reflecting lower performing provisions partially offset by higher impaired provisions; lower performing was driven by a more moderate build as Q4 2025 reflected deterioration in forward-looking macroeconomic indicators, while higher impaired provisions were largely related to one commercial borrower group, partially offset by lower provisions in equipment finance given a strategic shift to higher quality assets -- Adjusted PCL was up 186% y/y (reported 109% y/y), primarily reflecting higher impaired provisions in the commercial and personal lending portfolios -- Credit performance in Q1 reflected ongoing macroeconomic pressure expected to continue through H1 2026, with prudent provisions demonstrating continued discipline across EQB's risk management framework -- The Bank is appropriately reserved for credit losses with net allowances as a percentage of total loan assets of 43 bps, compared to 28 bps at Q1 2025
Dividend increase and share buybacks reflect balanced approach to capital deployment to drive sustainable, long-term shareholder value
-- EQB declared a dividend of $0.59 per common share payable on March 31,
2026, to shareholders of record as of March 13, 2026, representing 4% and
16% increases from the dividends paid in December 2025 and March 2025,
respectively
-- As part of its capital management strategy and to drive attractive
returns for shareholders, EQB renewed its Normal Course Issuer Bid (NCIB)
and established an Automatic Securities Purchase Plan (ASPP) in January
2026, the latter of which allows the repurchase of common shares under
the NCIB during restricted trading periods; in Q1, 1,066,890 common
shares were repurchased
"While we expect operating environment headwinds to persist through the first half of the year, we delivered strong first quarter performance with meaningful expense improvement and continued strategic investment in high--impact growth areas. Importantly, we also delivered stable margins and maintained our disciplined approach to lending, anchored in our robust risk management framework," said Anilisa Sainani, CFO. "We are pleased with our results and positive momentum towards our efficiency guidance in the low-50% range and 12% ROE objective for fiscal 2026. We remain focused on executing against our priorities and positioning the business to successfully capitalize on our significant opportunities ahead."
Analyst conference call and webcast: 10:30 a.m. ET on February 26, 2026
EQB's Chadwick Westlake, President and CEO, Anilisa Sainani, CFO, and Marlene Lenarduzzi, CRO, will host EQB's quarterly earnings call and webcast. The webcast with accompanying slides will be available at eqb.investorroom.com. To access the conference call with operator assistance, dial 416-945-7677 or 888-699-1199 five minutes prior to the start time.
(1) Adjusted measures and ratios are Non-Generally Accepted Accounting Principles (GAAP) measures and ratios. Adjusted measures and ratios are calculated in the same manner as reported measures and ratios, except that financial information included in the calculation of adjusted measures and ratios is adjusted to exclude the impact of one-time acquisition and integration related costs, and certain items which management determines would have a significant impact on a reader's assessment of business performance. For additional information and a reconciliation of reported results to adjusted results, see the "Non-GAAP financial measures and ratios" section. (2) PPPT represents pre-provision-pre-tax income, a non-GAAP measure of financial performance. (3) These are non-GAAP measures, see the "Non-GAAP financial measures and ratios" section.
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
Consolidated balance sheets (unaudited)
($000s) As at January 31, 2026 October 31, 2025 January 31, 2025
------------------------ ---------------- ---------------- ----------------
Assets:
Cash and cash
equivalents 889,635 717,253 810,017
Restricted cash 883,538 1,326,684 817,025
Securities purchased
under reverse
repurchase
agreements 2,298,802 1,604,165 1,800,014
Investments 1,605,119 1,645,864 1,571,754
Loans
Loans -- Personal 31,762,404 31,857,508 32,360,193
Loans -- Commercial 13,835,441 14,581,966 14,128,917
Allowance for credit
losses (210,260) (206,801) (148,715)
------------------------ ---------------- ---------------- ----------------
45,387,585 46,232,673 46,340,395
Securitization retained
interests 1,073,043 1,028,623 892,258
Deferred tax assets 33,732 36,429 28,841
Other assets
Derivative financial
instruments 236,240 242,799 263,856
Intangible assets 148,652 148,623 195,552
Goodwill 92,545 92,545 110,580
Investment in
associate 53,510 49,884 50,225
Other 421,505 368,179 351,307
------------------------ ---------------- ---------------- ----------------
952,452 902,030 971,520
Total assets 53,123,906 53,493,721 53,231,824
------------------------ ---------------- ---------------- ----------------
Liabilities and Equity
Liabilities:
Deposits 37,491,813 36,616,511 34,616,801
Securitization
liabilities 10,922,876 11,197,477 13,711,167
Obligations under
repurchase
agreements 29,356 104,568 -
Deferred tax
liabilities 205,217 199,151 190,419
Funding facilities 576,651 1,454,087 768,813
Other liabilities
Derivative financial
instruments 77,559 94,742 135,237
Other 673,826 615,386 587,951
------------------------ ---------------- ---------------- ----------------
751,385 710,128 723,188
Total liabilities 49,977,298 50,281,922 50,010,388
------------------------ ---------------- ---------------- ----------------
Equity:
Common shares 494,610 503,060 506,160
Other equity
instruments 147,360 147,360 147,360
Contributed deficit (16,284) (15,014) (17,437)
Retained earnings 2,507,738 2,566,475 2,564,315
Accumulated other
comprehensive income 5,404 1,684 11,200
------------------------ ---------------- ---------------- ----------------
Total shareholders'
equity 3,138,828 3,203,565 3,211,598
Non-controlling
interests 7,780 8,234 9,838
------------------------ ---------------- ---------------- ----------------
Total equity 3,146,608 3,211,799 3,221,436
------------------------ ---------------- ---------------- ----------------
Total liabilities and
equity 53,123,906 53,493,721 53,231,824
------------------------ ---------------- ---------------- ----------------
Consolidated statements of income (unaudited)
($000s, except per share amounts)
Three-month period ended January 31, 2026 January 31, 2025
------------------------------------------ ---------------- ----------------
Interest income:
Loans -- Personal 437,241 481,370
Loans -- Commercial 203,526 222,117
Investments(1) 21,169 20,792
Other 24,503 25,370
------------------------------------------ ---------------- ----------------
686,439 749,649
------------------------------------------ ---------------- ----------------
Interest expense:
Deposits 309,233 347,809
Securitization liabilities(1) 103,935 125,568
Funding facilities 6,470 5,547
Other 3,361 83
------------------------------------------ ---------------- ----------------
422,999 479,007
------------------------------------------ ---------------- ----------------
Net interest income(1) 263,440 270,642
Non-interest revenue:
Fees and other income 26,430 22,920
Net (losses) gains on loans and
investments (36) 2,304
Gain on sale from securitization
activities(1) 16,138 17,616
Net gains on hedging and derivatives 822 9,153
------------------------------------------ ---------------- ----------------
43,354 51,993
------------------------------------------ ---------------- ----------------
Revenue 306,794 322,635
Provision for credit losses 39,128 18,678
------------------------------------------ ---------------- ----------------
Revenue after provision for credit losses 267,666 303,957
Non-interest expenses:
Compensation and benefits 71,122 75,934
Product costs 24,338 23,362
Technology and system costs 21,895 23,532
Marketing and corporate expenses 15,785 17,082
Regulatory, legal and professional fees 16,987 12,874
Premises 8,236 6,471
------------------------------------------ ---------------- ----------------
158,363 159,255
------------------------------------------ ---------------- ----------------
Income before income taxes 109,303 144,702
Income taxes 29,772 36,992
Net income 79,531 107,710
------------------------------------------ ---------------- ----------------
Net income available to common
shareholders and non-controlling
interests 79,531 107,710
------------------------------------------ ---------------- ----------------
Net income attributable to:
Common shareholders 79,216 107,402
Non-controlling interests 315 308
------------------------------------------ ---------------- ----------------
79,531 107,710
------------------------------------------ ---------------- ----------------
Earnings per share:
Basic 2.13 2.79
Diluted 2.11 2.77
------------------------------------------ ---------------- ----------------
(1) Effective November 1, 2024, interest income earned on securitized retained
interests is reported in Interest income -- Investments and interest expense
incurred on servicing liabilities is reported in Interest expense --
Securitization liabilities. Previously, these amounts were included in
Non-interest revenue. Prior period comparative figures have been updated to
conform to current period presentation.
Consolidated statements of comprehensive income (unaudited)
($000s) Three-month period ended January 31, 2026 January 31, 2025
------------------------------------------ ---------------- ----------------
Net income 79,531 107,710
------------------------------------------ ---------------- ----------------
Other comprehensive income -- items that
will be reclassified subsequently to
income
Debt instruments at Fair Value through
Other Comprehensive Income:
Net change in (losses) gains on fair
value (4,921) 12,440
Recovery of credit losses recognized to
income (112) -
Reclassification of net losses (gains)
to income 8,924 (10,066)
Other comprehensive income -- items that
will not be reclassified subsequently to
income:
Equity instruments designated at Fair
Value through Other Comprehensive Income:
Net change in gains on fair value - 1,071
Reclassification of net gains to
retained earnings - (378)
3,891 3,067
Income tax (expense) recovery (1,101) (917)
------------------------------------------ ---------------- ----------------
2,790 2,150
------------------------------------------ ---------------- ----------------
Cash flow hedges:
Net change in unrealized gains (losses)
on fair value 10,075 (4,210)
Reclassification of net gains to income (8,750) (3,424)
------------------------------------------ ---------------- ----------------
1,325 (7,634)
Income tax (expense) recovery (365) 2,031
------------------------------------------ ---------------- ----------------
960 (5,603)
------------------------------------------ ---------------- ----------------
Total other comprehensive income (loss) 3,750 (3,453)
------------------------------------------ ---------------- ----------------
Total comprehensive income 83,281 104,257
------------------------------------------ ---------------- ----------------
Total comprehensive income attributable
to:
Common shareholders 82,966 103,949
Non-controlling interests 315 308
------------------------------------------ ---------------- ----------------
83,281 104,257
------------------------------------------ ---------------- ----------------
Consolidated statements of changes in equity (unaudited)
($000s) Three-month period ended January 31, 2026
----------------------------------------------------- -------------------------------------------------------------------------------
Accumulated other
comprehensive income
(loss)
Other Cash Financial Attributable
Common equity Contributed Retained Flow Instruments to equity Non-controlling
Shares instruments Deficit Earnings Hedges at FVOCI Total holders interests Total
Balance,
beginning of
period 503,060 147,360 (15,014) 2,566,475 1,697 (13) 1,684 3,203,565 8,234 3,211,799
Net Income - - - 79,216 - - - 79,216 315 79,531
Transfer of AOCI
losses to
income, net of
tax - - - - - (30) (30) (30) - (30)
Other
comprehensive
gain, net of
tax - - - - 960 2,790 3,750 3,750 - 3,750
Exercise of
stock options 4,313 - - - - - - 4,313 - 4,313
Common shares
repurchased and
cancelled, net
of tax (13,842) - - (97,016) - - - (110,858) - (110,858)
Automatic Share
purchase
obligation - - - (19,686) - - - (19,686) - (19,686)
Dividends:
Common shares - - - (21,251) - - - (21,251) (769) (22,020)
Put option --
non-controlling
interest - - (877) - - - - (877) - (877)
Stock-based
compensation - - 686 - - - - 686 - 686
Transfer
relating to the
exercise of
stock options 1,079 - (1,079) - - - - - - -
----------------- -------- ----------- ----------- --------- ------ ----------- ----- ------------ --------------- ---------
Balance, end of
period 494,610 147,360 (16,284) 2,507,738 2,657 2,747 5,404 3,138,828 7,780 3,146,608
----------------- -------- ----------- ----------- --------- ------ ----------- ----- ------------ --------------- ---------
($000s) Three-month period ended January 31, 2025
---------------------------------------------------- ----------------------------------------------------------------------------------
Accumulated other
comprehensive income (loss)
Other Cash Financial Attributable
Common equity Contributed Retained Flow Instruments to equity Non-controlling
Shares instruments Deficit Earnings Hedges at FVOCI Total holders interests Total
Balance,
beginning of
period 505,876 147,440 (17,374) 2,483,309 21,617 (13,062) 8,555 3,127,806 10,379 3,138,185
Net Income - - - 107,402 - - - 107,402 308 107,710
Realized loss on
sale of shares,
net of tax - - - (5,718) - - - (5,718) - (5,718)
Transfer of AOCI
losses to
retained
earnings, net
of tax - - - - - 6,004 6,004 6,004 - 6,004
Transfer of AOCI
losses to
income, net of
tax - - - - - 94 94 94 - 94
Other
comprehensive
(loss) gain,
net of tax - - - - (5,603) 2,150 (3,453) (3,453) - (3,453)
Exercise of
stock options 460 - - - - - - 460 - 460
Common shares
repurchased and
cancelled, net
of tax (275) - - (1,832) - - - (2,107) - (2,107)
Issuance costs,
net of tax - (80) - - - - - (80) - (80)
Dividends:
Common shares - - - (18,846) - - - (18,846) (849) (19,695)
Put option --
non-controlling
interest - - (1,131) - - - - (1,131) - (1,131)
Stock-based
compensation - - 1,167 - - - - 1,167 - 1,167
Transfer
relating to the
exercise of
stock options 99 - (99) - - - - - - -
----------------- ------- ----------- ----------- --------- ------- ----------- ------- ------------ --------------- ---------
Balance, end of
period 506,160 147,360 (17,437) 2,564,315 16,014 (4,814) 11,200 3,211,598 9,838 3,221,436
----------------- ------- ----------- ----------- --------- ------- ----------- ------- ------------ --------------- ---------
Consolidated statements of cash flows (unaudited)
January 31, January 31,
($000s) Three-month period ended 2026 2025
---------------------------------------------- -------------- --------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income 79,531 107,710
Adjustments for non-cash items in net income:
Financial instruments at fair value through
income (6,301) (20,498)
Amortization of premiums/discounts (2,597) (2,830)
Amortization of capital and intangible
assets 14,941 14,823
Provision for credit losses 39,128 18,678
Securitization gains (16,138) (17,616)
Stock-based compensation 686 1,167
Income taxes 29,772 36,992
Securitization retained interests 50,187 39,957
Changes in operating assets and liabilities:
Restricted cash 443,146 154,962
Securities purchased under reverse
repurchase agreements (694,637) (539,896)
Loans receivable, net of securitizations 717,010 625,297
Other assets (30,752) (21,739)
Deposits 892,641 848,736
Securitization liabilities (280,365) (893,246)
Obligations under repurchase agreements (75,212) -
Funding facilities (877,436) (178,143)
Other liabilities 43,924 51,673
Income taxes paid (32,368) (39,231)
---------------------------------------------- -------------- --------------
Cash flows from operating activities 295,160 186,796
---------------------------------------------- -------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common shares 4,313 460
Common shares repurchased (110,858) (2,107)
Limited recourse capital notes - (80) Dividends paid on common shares (22,020) (19,695) ---------------------------------------------- -------------- -------------- Cash flows used in financing activities (128,565) (21,422) ---------------------------------------------- -------------- -------------- CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments (36,424) (3,730) Proceeds on sale or redemption of investments 77,183 31,366 Investment in associate (3,598) - Net change in Canada Housing Trust re-investment accounts - 41,409 Purchase of capital assets and system development costs (31,374) (16,043) Cash flows from investing activities 5,787 53,002 ---------------------------------------------- -------------- -------------- Net increase in cash and cash equivalents 172,382 218,376 Cash and cash equivalents, beginning of period 717,253 591,641 ---------------------------------------------- -------------- -------------- Cash and cash equivalents, end of period 889,635 810,017 ---------------------------------------------- -------------- -------------- Supplemental statement of cash flows disclosures Cash flows from operating activities include: Interest received 682,412 709,697 Interest paid (354,014) (416,436) Dividends received - 218 ---------------------------------------------- -------------- --------------
About EQB Inc.
EQB Inc. (TSX: EQB) is a leading digital financial services company with $142 billion in combined assets under management and administration (as at January 31, 2026). It offers banking services through Equitable Bank, a wholly owned subsidiary and Canada's seventh largest bank by assets, and wealth management through ACM Advisors, a majority owned subsidiary specializing in alternative assets. As Canada's Challenger Bank$(TM)$, Equitable Bank has a clear mission to drive change in Canadian banking to enrich people's lives. It leverages technology to deliver exceptional personal and commercial banking experiences and services to over 800,000 customers and more than six million credit union members through its businesses. Through its digital EQ Bank platform (eqbank.ca) its customers have named it one of Canada's top banks on the Forbes World's Best Banks list since 2021.
Please visit eqb.investorroom.com for more details.
Investor contact:
Lemar Persaud
VP and Head of IR
investor_enquiry@eqb.com
Media contact:
Maggie Hall
Director, PR & Communications
maggie.hall@eqb.com
Cautionary Note Regarding Forward-Looking Statements
Statements made by EQB in the sections of this news release, in other filings with Canadian securities regulators and in other communications include forward-looking statements within the meaning of applicable securities laws (forward-looking statements). These statements include, but are not limited to, statements about EQB's objectives, strategies and initiatives, financial performance expectation, statements with respect to EQB's intention to renew and/or make share repurchases under its NCIB, and other statements made herein, whether with respect to EQB's businesses or the Canadian economy. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "intends", "scheduled", "planned", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases which state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved", or other similar expressions of future or conditional verbs. These statements include, but are not limited to, statements with respect to the completion of transactions that are subject to customary closing conditions and regulatory approvals, EQB's ability to successfully integrate acquired business, the timing and expected benefits of such transactions, statements relating to the expected impact of the Acquisition (as defined herein), the anticipated benefits of the Acquisition,, including the expected impact on EQB's size, operations, capabilities, growth drivers and opportunities, activities, attributes, profile, business services portfolio and loans, revenue and assets mix, market position, profitability, performance, and strategy; the expected impact of the Acquisition on EQB's financial performance; expectations regarding EQB's business model, plans and strategy, the maintenance of CET1 ratio and changes in adjusted EPS; retention of PC Financial management and employees and the strategic fit and complementarity of PC Financial and Equitable Bank; anticipated synergies and estimated transaction and integration costs and the timing of incurrence thereof, as well as EQB's financial performance objectives, vision and strategic goals, the economic and market review and outlook, the regulatory environment in which we operate, the outlook and priorities for each of its business lines, the risk environment including liquidity and funding risk, and statements by EQB representatives.
Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, closing of transactions, performance or achievements of EQB to be materially different from those expressed or implied by such forward-looking statements, including but not limited to statements with respect to the completion of transactions that are subject to customary closing conditions and regulatory approvals, EQB's ability to successfully integrate acquired businesses, the timing and expected benefits of such transactions, risks related to capital markets and additional funding requirements, fluctuating interest rates and general economic conditions including, without limitation global geopolitical risk, uncertainty arising from ongoing United States/Canada tariff concerns and related impacts, business acquisition, legislative and regulatory developments, changes in accounting standards, the nature of EQB's customers and rates of default, the successful and timely approval of the Acquisition, the integration of PC Financial and the realization of the anticipated benefits and synergies of the Acquisition in the timeframe anticipated, including impact and accretion in various financial metrics; the ability to retain management and key employees of PC Financial; and competition as well as those factors discussed under the heading "Risk Management" in EQB's Q1 Management's Discussion and Analysis (MD&A) and in EQB's documents filed on SEDAR+ at www.sedarplus.ca.
All material assumptions used in making forward-looking statements are based on management's knowledge of current business conditions and expectations of future business conditions and trends, including their knowledge of the current credit, interest rate and liquidity conditions affecting EQB and the Canadian economy. Although EQB believes the assumptions used to make such statements are reasonable at this time and has attempted to identify in its continuous disclosure documents important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Certain material assumptions are applied by EQB in making forward-looking statements, including without limitation, assumptions regarding its continued ability to fund its mortgage business, a continuation of the current level of economic uncertainty that affects real estate market conditions, continued acceptance of its products in the marketplace, as well as no material changes in its operating cost structure and the current tax regime. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. EQB does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws.
Non-Generally Accepted Accounting Principles (GAAP) Financial Measures and Ratios
To enable readers to better assess trends in underlying business performance and increase consistency with the reporting regimens used by other leading Canadian financial institutions, EQB provides adjusted results in parallel with reported measures. Adjusted results are non-GAAP financial measures that enable readers to assess underlying business results and trends. Adjustments listed below are presented on a pre-tax basis:
Q1 2026
-- $5.8 million PC Financial acquisition and integration-related costs; and
-- $2.0 million Concentra Bank and ACM acquisitions-related intangible asset
amortization.
Q4 2025
-- $21.8 million decrease in net interest income due to non-recurring fair
value adjustments on covered bonds and interest on securitizations;
-- $92.0 million restructuring, severance and impairment charges, of which
$12.8 million reflects impairments on non-operating assets related to the
equipment financing business and $79.2 million of restructuring charges
including goodwill and intangible asset impairments and severance
provisions;
-- $8.7 million non-recurring transaction fees;
-- $6.5 million professional fees related to the announced agreement to
acquire PC Financial; and
-- $2.0 million Concentra Bank and ACM acquisition related intangible asset
amortization.
Q1 2025
-- $2.8 million new office lease related expenses prior to occupancy,
-- $1.8 million non-recurring operational effectiveness expenses and
acquisition and integration-related costs,
-- $2.0 million Concentra Bank and ACM acquisition related intangible asset
amortization, and
-- $5.0 million provision for credit losses associated with an equipment
financing purchase facility.
The following table presents a reconciliation of GAAP reported financial results to non-GAAP adjusted financial results.
Reconciliation of reported and adjusted financial results For the three months ended ------------------------------------------ ---------------------------------- ($000, except share and per share amounts) 31-Jan-26 31-Oct-25 31-Jan-25 ------------------------------------------ ---------- ---------- ---------- Reported results Net interest income(1) 263,440 286,427 270,642 Non-interest revenue(1) 43,354 30,660 51,993 Revenue 306,794 317,087 322,635 Non-interest expense 158,363 261,472 159,255 Pre-provision pre-tax income(2) 148,431 55,615 163,380 Provision for credit loss 39,128 54,551 18,678 Income taxes 29,772 5,822 36,992 Net income (loss) 79,531 (4,758) 107,710 Net income (loss) attributable to common shareholders 79,216 (9,474) 107,402 ------------------------------------------ ---------- ---------- ---------- Adjustments Net interest income -- interests and covered bond fair value adjustments - (21,784) - Non-interest revenue -- non-operating asset impairments - 12,809 - Non-interest expenses -- PC Financial acquisition and integration-related costs (5,837) (6,505) - Non-interest expenses -- Concentra Bank and ACM acquisition-related intangible asset amortization (1,969) (1,969) (1,969) Non-interest expenses -- non-recurring operational effectiveness and acquisition-related costs(3) - - (1,782) Non-interest expenses -- restructuring, severance, and impairments - (79,236) - Non-interest expenses -- non-recurring transaction fees - (8,721) - Non-interest expenses -- new office lease related costs - - (2,789) Provision for credit loss -- equipment financing - - (5,018) Impact on net income before taxes from adjustments 7,806 87,456 11,558 Income taxes -- tax impact on above adjustments(4) 2,103 19,215 3,039 ------------------------------------------ ---------- ---------- ---------- Post-tax adjustments -- net income 5,703 68,241 8,519 Adjustments attributed to minority interests (229) (228) (261) ------------------------------------------ ---------- ---------- ---------- Post-tax adjustments -- net income to common shareholders 5,474 68,013 8.258 ------------------------------------------ ---------- ---------- ---------- Adjusted results Net interest income(1) 263,440 264,643 270,642 Non-interest revenue(1) 43,354 43,469 51,993 Revenue 306,794 308,112 322,635 Non-interest expense 150,557 165,041 152,715 Pre-provision pre-tax income(2) 156,237 143,071 169,920 Provision for credit loss 39,128 54,551 13,660 Income taxes 31,875 25,037 40,030 Net income 85,234 63,483 116,230 Net income attributable to common shareholders 84,690 58,539 115,662 ------------------------------------------ ---------- ---------- ---------- Diluted earnings per share Weighted average diluted common shares outstanding 37,465,645 38,269,352 38,781,523 Diluted earnings per share -- reported 2.11 (0.25) 2.77 Diluted earnings per share -- adjusted 2.26 1.53 2.98 Diluted earnings per share -- adjustment impact 0.15 1.78 0.21 ------------------------------------------ ---------- ---------- ---------- (1) Effective November 1, 2024, interest income earned from retained interests and interest expense incurred on servicing liabilities are reclassed from Non-interest revenue to Net interest income. Prior period comparative figures have been updated to conform to current period presentation. (2) This is a non-GAAP measure, see Non-GAAP financial measures and ratios section of this MD&A. (3) Includes non-recurring operational effectiveness and acquisition and integration-related costs associated with Concentra Bank and ACM. (4) Income tax expense associated with non-GAAP adjustment was calculated based on the statutory tax rate applicable for that period.
Other non-GAAP financial measures and ratios:
-- Adjusted efficiency ratio: it is derived by dividing adjusted
non-interest expenses by adjusted revenue. A lower adjusted efficiency
ratio reflects a more efficient cost structure
-- Adjusted return on equity $(ROE)$ is calculated on an annualized basis and
is defined as adjusted net income available to common shareholders as a
percentage of weighted average common shareholders' equity (reported)
outstanding during the period.
-- Assets under administration (AUA): is sum of (1) assets over which EQB's
subsidiaries have been named as trustee, custodian, executor,
administrator, or other similar role; (2) loans held by credit unions for
which EQB's subsidiaries act as servicer.
-- Assets under management (AUM): is the sum of total balance sheet assets,
loan principal derecognized but still managed by EQB, and assets managed
on behalf on investors.
-- Loans under management (LUM): is the sum of loan principal reported on
the consolidated balance sheet and loan principal derecognized but still
managed by EQB.
-- Net interest margin (NIM): this profitability measure is calculated on an
annualized basis by dividing net interest income by the average total
interest earning assets for the period.
-- Pre-provision pre-tax income (PPPT): this is the difference between
revenue and non-interest expenses.
-- Total loan assets: this is calculated on a gross basis (prior to
allowance for credit losses) as the sum of both Loans -- Personal and
Loans -- Commercial on the balance sheet.
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SOURCE EQB Inc.
(END) Dow Jones Newswires
February 25, 2026 17:05 ET (22:05 GMT)