Canadian bank stocks surged after strong earnings from BMO, TD and CIBC, and one portfolio manager says the results show meaningful improvement in credit trends and revenue diversity across parts of the sector. He also warns that despite the momentum, valuations and domestic lending risks deserve more attention as investors position for 2026.
BNN Bloomberg spoke with Grant White, portfolio manager at Endeavour Wealth Management, who now favours BMO as the best value buy among the big banks. He says TD and CIBC remain holds with selective upside, while Royal continues to screen as high quality but less attractively priced.
Key Takeaways
- BMO moved to a buy rating after cleaner credit trends, stronger U.S. performance and more diversified revenue sources.
- TD remains a hold with speculative appeal, but needs stronger contributions from wealth and insurance before earning a full upgrade.
- CIBC stays a hold due to higher domestic mortgage exposure and less revenue diversification compared with peers.
- Royal Bank remains a high-quality name, but current pricing makes it less compelling than BMO for new capital.
- Investors should be cautious on valuations after a strong run in bank shares, with opportunities improving if prices pull back.
Read the full transcript below:
ANDREW: BMO, CIBC and TD have all beaten on earnings and lifted their dividends. Is now a good time to buy those stocks? Let’s get some ideas from Grant White, portfolio manager at Endeavour Wealth Management. Grant, great to see you as ever. Thanks very much.
GRANT: Yeah, always my pleasure, Andy. Good to see you.
ANDREW: Start off with BMO. Your basic verdict on that stock is a hold, but you’re tilting towards buying it.
GRANT: Yeah. So actually, I think after this report we are in buy mode right now, to be quite honest. What we really liked out of this report is that things got a little bit cleaner on the BMO side. We’ve liked BMO for a long time — we’ve been buying into it, frankly, over the last few years — and it’s been a great core holding for us. I think things are clearing up a little bit. We love that the loan-loss provisions are cleaning up, especially on the U.S. side of things, which is a big part of the business.
We love seeing our Canadian banks with a little bit of diversity in the revenue streams, and BMO is very well-positioned right now. The report was nice from a beat perspective, but where the revenue is coming from is also really important to us. We’re seeing a lot of diversity there, especially compared to the other Canadian banks. For all those reasons, we decided to switch — just this morning — into a buy on BMO.
The other thing I really like is pricing, to be quite fair. I think we’re getting good value right now with BMO, especially compared to its peers. Good pricing combined with diverse revenue streams is a good thing right now for BMO.
ANDREW: TD Bank. This is a hold, but perhaps a buy for speculators or investors with more of a speculative bent?
GRANT: Yeah, I would say TD — we’re still maintaining our same position, so we’re in a hold. The reason why we put a bit of a speculative buy on it is because we know TD is a good company and we believe they will figure things out. We’re not buying it today, but we are holding it.
This was a good report. That’s not to take away from anything — TD is doing quite well in a number of areas, especially following the fallout, if you will, from a couple of years ago in the United States. I think they’re navigating that really well. I think they’re earning back trust. Their revenue streams are diverse.
I would love to see a little bit more out of the other revenue streams aside from net interest income. If we can see a bit more out of the wealth management business and a bit more out of insurance, then I think we’re going to be in buy mode. But for now, we still have it as a hold. It’s a good report — everybody should be very happy as a TD shareholder today.
ANDREW: OK. And then finally, CIBC. What’s your verdict there? That stock is near record highs.
GRANT: Yeah. CIBC is really interesting because we have it again as a hold, but more of a speculative buy if you’re interested in taking a bit of a leap on it. CIBC had another fantastic report. They’re doing a lot of the right things. But I do think there are better options out there in the Canadian banks — BMO being one of them — and primarily for that reason, we’re not buying into CIBC.
As I said earlier, I love a Canadian bank with a diversified revenue stream, and I’d love to see CIBC do more of that going forward. They’ve done great in capital markets — that can’t be taken away — but I’d love to see more diversity, whether that’s geographic or in other revenue streams such as wealth management.
For all those reasons, I think CIBC remains a somewhat speculative buy. It’s not high risk — it’s a Canadian bank at the end of the day — but compared to its peers, it’s more speculative in my mind. I think there’s a bit more risk on the table. I don’t love the exposure to debt, lending and housing. I think there are some ripples that could come out of that. Overall, really great report. We’re keeping it as a hold for now, but if you want to take a bit of a flyer on a Canadian bank, CIBC might be the one.
ANDREW: I’m sorry, did you say residential exposure — mortgage exposure — at CIBC?
GRANT: Yeah, that’s a bit more of the concern I see today. They’re so tied domestically in Canada that I see more risk there compared to some of their peers. Especially when I’m comparing it to BMO — I’m seeing a higher-quality offering at BMO right now. It’s easier for us to buy into it.
If you’re basing it on pure pricing, CIBC looks great. But I think we’re doing pretty well with BMO on pricing, and we’re getting much better quality out of BMO in terms of their fundamentals. If you’re just looking at pure pricing and you think CIBC will do well, especially in areas like capital markets, and you’re not worried about residential financial debt exposure in Canada, then you might do quite well with CIBC as well.
ANDREW: What about Royal? It’s almost like a knee-jerk choice among portfolio managers. Would you be a buyer of Royal?
GRANT: Yeah, we still like Royal. We’re not actively buying Royal today, to be quite honest. We’ve held it for a long, long time. We’d be putting more money into BMO today than into Royal. But Royal is absolutely quality, and I’d put them in the same breath as BMO.
Diverse revenue streams are really important to us. They’ve done well on that front for a long time. For me, it’s more of a pricing opportunity. We’re getting better pricing out of BMO. If we got better pricing out of Royal down the road, then we might look to switch.
But as of right now, Royal and BMO are both highest quality in my mind. Just be careful with pricing. We’ve seen a huge run-up in bank shares this year, which is great, but you have to be careful on pricing going forward. That’s my only comment. Overall, Royal is a fantastic company. Just be careful on pricing.
ANDREW: Grant, thank you very much. It’s always great to hear from you.
GRANT: My pleasure, Andy. Take care.
ANDREW: That’s Grant White, portfolio manager at Endeavour Wealth Management
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This BNN Bloomberg summary and transcript of the Dec. 4, 2025 interview with Grant White 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.
