Canadian bank stocks are showing uncommon strength heading into earnings season, climbing to the top of relative strength rankings after an extended period of market resilience. Investors are watching for signs of stronger capital-markets activity, improving wealth-management results and any shift in loan-loss provisions as lenders report fiscal year-end numbers.
BNN Bloomberg spoke with Colin Cieszynski, chief market strategist at Calgary-based SIA Wealth Management, who says banks’ recent leadership is notable against a backdrop of economic uncertainty and pressure on non-bank lenders.
Key Takeaways
- Canadian bank stocks are climbing to the top of relative strength rankings, a shift Colin Cieszynski calls rare heading into earnings season.
- Strong markets may lift banks’ capital-markets and wealth-management divisions, while economic data — including strong GDP — could support results.
- Loan-loss provisions, dividend decisions and commentary on the economy remain key indicators for investors during fiscal year-end reporting.
- Barrick’s evaluation of a North American gold-asset IPO reflects attempts to unlock value amid leadership changes, but banks remain the dominant story for now.
Read the full transcript below:
ANDREW: Barrick Mining shares are higher today after the company announced the potential spinoff, by way of an IPO, of its North American assets. Also at stake is that huge mine in the Dominican Republic. Investors seem to like the news. Let’s get more from Colin Cieszynski of SIA Wealth Management. Colin, great to have you on the show. Thanks for joining us.
COLIN: Thanks. Good morning, Andy.
ANDREW: Things are moving very fast at Barrick. Mark Bristow, the CEO, is out, and they’re now talking about breaking up the company, potentially.
COLIN: It sure is. At this point, they’re talking about spinning off a minority interest to the public in the North American mines, and that’s fairly significant. A lot of Barrick’s problems, and things that had weighed on the stock prior to the last few months when all the changes started, were international. They’ve always had this core jewel of the Nevada mines that are very stable and have been producing for decades. But the company’s valuation has depended a lot on the ups and downs of political and operational risks in other countries.
ANDREW: Yeah, Pakistan comes up here, and National Bank says one concern could be the actual valuation on the rump of the company: Africa, and then this giant Pakistan mine that’s going to be swallowing up cash as they build it out.
COLIN: It’s true. And that’s why I think what they’re trying to do is unlock some of the value in the North American operations. The big question is what they’ll do with it after that. Will they use it to potentially shore up some of their international operations? It remains to be seen at this point what they would do with the capital they raise from this spinoff.
ANDREW: The banks are beginning to report this week. What are you looking out for here, Colin?
COLIN: The banks have been really strong lately. They’ve been showing great relative strength compared with other stocks in the Canadian market. What I’m looking for this time is whether the strong period we’ve had in the stock market translates into better results for the capital-markets and wealth-management divisions. On the banking side, we want to know how the Canadian economy is doing, and how the U.S. economy is doing. The Canadian GDP report that came out last Friday was spectacular, so hopefully that turns into positive results for the banks.
We’ll watch for headline results, comments on the economy and what they do with their loan-loss provisions — always a big one. Are they lower or higher than previous periods, and what does that signal? And do any of them raise dividends? This is their fiscal year-end as well.
ANDREW: Right — and the banks, of course, are famous for their big dividends. One thing that’s interesting to me: bank stocks are down today. They hit a record high on Friday. But these non-bank lenders such as EQB, Propel and GoEasy have seen major pressure on their shares.
COLIN: Yes, and that’s probably related to questions about how strong the Canadian economy actually is. The non-bank lenders might feel stress at the margins first. They may get impacted earlier than the big banks, which are so large and diversified across many businesses.
ANDREW: Do you always have to own some Canadian banks if you’re a Canadian fund manager, pretty well?
COLIN: If you want to try to keep up with the index when banks are doing well, yes. If you don’t own banks, it’s really hard to keep up because they’re such a significant part of the index. For institutional investors in particular, it’s important to hold some bank exposure at any given point for benchmarking purposes. There’s room to deviate, and room for concentrated portfolios, but when banks are doing well, they tend to be must-own stocks.
In our relative strength rankings right now, we’ve seen the banks climbing to the top. They’re dominating in a way we haven’t seen in quite some time. They’re usually in an upper-middle group, but now they’re right at the top heading into earnings season.
ANDREW: Is there a case to be made that — although the past doesn’t guarantee the future — just owning bank stocks over the years has worked?
COLIN: To a certain extent, yes. Banks have ups and downs, like any sector. But in Canada, the resource stocks are extremely volatile and a big chunk of the index. Resource stocks can drive the index sharply up or down. Banks tend to be the stable group in the middle. Yes, they fluctuate, but not to the extent other sectors do.
ANDREW: I’m looking at a calculation here: if you had put all your money into bank stocks at the end of the last century, Colin, according to my Bloomberg screen, you would have had a return of 2,000 per cent. Just putting your money in the TSX Composite would have returned a bit more than 600 per cent. So 2,000 per cent versus 630 per cent. Incredible how well the banks have done — and they tend to earn higher profit margins, or at least return on equity, on their Canadian business.
COLIN: That’s true. They’re in such a dominant position in Canada. They’re involved in everything — lending to companies and individuals, mortgages, credit cards, insurance. They’re almost a reflection of the Canadian economy because they have a finger in every pie.
ANDREW: The government made noises in the budget about stepping up competition in the sector. We probably shouldn’t hold our breath. They have great lobbying power, for one thing.
COLIN: It’s hard to say. Who knows what they’ll actually do over time? Even if they opened up the market today, it would take time for anyone to make meaningful inroads because the big banks have such a dominant position.
ANDREW: Yeah, although the banks must be paying attention to the rise of financial apps. I saw a Royal Bank ad not long ago poking fun at one. I’m sure they’re worried these apps may take younger customers away.
COLIN: It’s hard to say. Anything is possible. The question is how much. At the end of the day, you almost always end up dealing with one of the big banks. You might do certain things with other providers, but ultimately you’re tied to the banks in this country. They’re in a very strong position.
ANDREW: Colin, thank you very much. Colin Cieszynski of SIA Wealth Management.
Correction: EQB was mistakenly referred to a non-bank lender. Equitable Bank is a regulated bank in the same category as other major banks in Canada.
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This BNN Bloomberg summary and transcript of the Dec. 1, 2025 interview with Colin Cieszynski are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
