Bank Leaders Address Trade Uncertainty Impacting Growth Strategies

Canada’s major banks have reported better-than-expected performance in 2025, yet their chief executives acknowledge that trade uncertainty remains a significant challenge. During the Scotiabank Financials Summit held in Toronto, banking leaders highlighted the potential impact of the future of the Canada-U.S.-Mexico free trade agreement on their growth strategies.

Trade Uncertainty Influencing Business Decisions

According to the banking executives, the ongoing uncertainty surrounding trade, interest rates, and the overall economy is causing both consumers and businesses to hesitate on major financial decisions. Darryl White, CEO of BMO (Bank of Montreal), noted that while there is emerging clarity in the U.S. following the recent tax reforms, Canada is still grappling with unclear trade relations with its southern neighbor.

White stated, “There is more certainty than at the start of the year, but hard numbers on what federal business support will look like are still lacking.” This assessment reflects a cautious optimism, as executives strive to enhance operational efficiencies to maximize the benefits of existing business activities.

Scott Thomson, CEO of Scotiabank, echoed these sentiments, indicating that trade uncertainty is restraining the bank’s capacity to invest in Mexico. Despite these challenges, Thomson emphasized that the bank is laying the groundwork for future opportunities when conditions stabilize.

Impacts on the Banking Sector and Future Outlook

The banking sector’s focus on efficiency is a strategic response to the prevailing uncertainties. With many potential clients hesitant to make significant commitments, banks are prioritizing maximization of current resources. The executives expressed hope that clearer policies and a more stable economic environment will emerge, allowing for increased investment and growth.

This analysis comes at a crucial time as Canadian banks navigate a landscape marked by fluctuating interest rates and evolving economic conditions. The ongoing discussions regarding trade agreements are expected to play a pivotal role in shaping the future outlook for the financial industry in Canada.

The insights shared at the Scotiabank Financials Summit reflect a broader narrative of adaptation and resilience in the face of uncertainty. As banking leaders continue to assess the landscape, their focus remains on building a foundation for sustainable growth, despite the challenges posed by trade dynamics.

This report was originally published by The Canadian Press on September 3, 2025. The developments discussed will be closely monitored as they unfold in the coming months.