'Measured confidence': RBC, TD Bank, CIBC share optimistic outlook for Canada's economy

'Measured confidence': RBC, TD Bank, CIBC share optimistic outlook for Canada's economy

More big banks posted Q3 financial results Thursday amid escalating trade war

Three of Canada's big banks shared cautiously sunny outlooks for the economy on Thursday, sharply contrasting expressions of anxiety and frustration from scores of smaller businesses grappling with the fresh reality of a full-blown trade war with the United States.

Royal Bank of Canada, Toronto-Dominion Bank, and CIBC reported financial results before Thursday's opening bell on the Toronto Stock Exchange.

Together, this trio of Canadian banking giants has as much as $6 trillion worth of assets on their balance sheets. With vast portfolios of mortgages, auto loans and other debt products for consumers and businesses, and client networks spanning Canada and the U.S., these goliath institutions have a unique vantage point from which to monitor the impact of tariffs.

"The Canadian economy has proven to be resilient. The improvements in employment and GDP seen in Q2 maintain a cautiously optimistic outlook that the economy will continue to expand," RBC CEO Dave McKay said on the bank's quarterly conference call Thursday morning.

"While Canada and the U.S. have yet to come to a longer-term solution, we note the average effective tariff rate remains low, at approximately six percent, with over 80 per cent of exports remaining duty-free.”

Investment 'super cycle' to the rescue

On Thursday, TD Bank CEO Raymond Chun referred to an emerging "super cycle" for investment in Canada, spurred by government spending in areas like infrastructure and national defence. According to TD Economics, Ottawa and the provinces have over $1 trillion in announced projects already approved or on the table through 2035 and beyond.

"In Canada, trade tensions have not dampened investment opportunities, as governments seek to drive new activity," Chun said.

"More could be rolled out across Canada over the coming decade in a historic investment super cycle," he added. "We are very well positioned to benefit from this activity."

CIBC CEO Harry Culham said he has "measured confidence" about the back half of 2026.

"The trade environment will continue to evolve, and we are not going to speculate on where it lands," he said on Thursday, speaking on his bank's conference call with stock market analysts.

CIBC chief risk officer Frank Guse said that CIBC is closely monitoring Canada's labour market for signs of weakness.

A recent Oxford Economics study prepared for the Canadian American Business Council found more than 100,000 Canadian jobs could be lost if the Canada-U.S.-Mexico Agreement (CUSMA) was eliminated.

BMO Capital Markets predicts the latest round of U.S. tariffs will carve roughly half a percentage point from Canadian growth, mostly through weaker business confidence and investment.

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On Wednesday, National Bank's CEO Laurent Ferreira said Canada's economy has "demonstrated resilience" over the past 18 months. Like his peers, he also praised Ottawa's large-scale investment plans, as well as the newly announced government aid measures for workers and businesses impacted by U.S. tariffs.

"Energy, power infrastructure, and the recent icebreaker contract announcement are great examples of our country moving in the right direction," Ferreira said, referring to a commitment announced by the federal government to build six icebreaker ships in Quebec.

He also praised the Office of the Superintendent of Financial Institutions' June decision to lower its domestic stability buffer, allowing banks more flexability to lend to struggling businesses.

On Tuesday, the CEO of Bank of Montreal and Scotiabank separately called the Canada-U.S. trade war manageable.

On the Toronto Stock Exchange, shares of Canada's big banks continue to trade near all-time highs. The iShares S&P/TSX Capped Energy Index ETF, a basket of Canadian bank stocks, has soared over 46 per cent year-to-date.

Jeff Lagerquist is a senior writer with CBC News based in Toronto. Originally from Erin, Ont., he studied journalism at Toronto Metropolitan University. Jeff previously worked as a senior reporter for Yahoo Finance Canada. He was also a reporter and digital producer for CTV National News, BNN Bloomberg and The Financial Post. He was also a Columbia University energy journalism fellow for 2025.