EQB Inc.

EQB reported full-year 2025 diluted EPS of $8.90 and ROE of 11.3%, and Q4 diluted EPS of $1.53 with ROE of 7.5%. Q4 net interest income was $265 million, down 2% year over year and up 1% sequentially; NIM was 2.01%, down 8 bps year over year but up 4 bps sequentially. Noninterest revenue was $43.5 million, down 15% year over year and 9% sequentially, and noninterest expenses rose 11% year over year. Loans under management were $74.5 billion, up 10% year over year, deposits were $36.1 billion, up 9% year over year, and CET1 was 13.3%. The company recognized a final pretax restructuring charge of $92 million and expects about $45 million in annual expense savings in fiscal 2026. Management said 2026 outlook excludes PC Financial and expects LUM growth in the high single digits to low double digits, margins around the 2%+ level, total expense growth in the low single digits, a low-50s efficiency ratio, and ROE materially above Q4’s 7.5%, potentially approaching 12% and higher later in fiscal 2026.

Chadwick Westlake framed 2025 as a difficult transition year and said the company is now focused on a future plan that concentrates capital and talent on the highest-return opportunities. He emphasized EQ Bank growth, the launch of small business banking, and the PC Financial acquisition as key steps toward completing the product shelf and making EQB a stronger Challenger bank. His tone was confident but pragmatic: he acknowledged housing and credit pressure, but repeatedly pointed to capital strength, cost discipline, and what he described as a likely rebound in 2026.

Anilisa Sainani highlighted that full-year results were weighed by a soft housing market, rising unemployment, higher provisions for credit losses, and higher expenses. She said the restructuring program produced a final pretax charge of $92 million and should generate about $45 million in annual expense savings in fiscal 2026, with total expense growth expected to be in the low single digits and the efficiency ratio in the low 50s. She also pointed to CET1 of 13.3%, reiterated a capital allocation focus on organic growth, rising dividends, and buybacks, and said the company repurchased a record 731,000 shares in the quarter and expects to continue buybacks next year.

Analysts pressed management on elevated commercial and residential credit losses, asking whether impairments were a high-water mark and how long resolutions would take; management said commercial resolution times are roughly 12 to 18 months and residential cases can take 6 to 12 months, but early-stage delinquencies are trending better. Questions also focused on the restructuring savings, where management said the $45 million benefit should start flowing through in Q1 and that the savings are intended to improve bottom-line performance. On the PC Financial deal, analysts asked about capital, risk, and the economics of cards versus mortgages; management said the asset is high-quality, mostly prime/super-prime, that the deal is expected to close in the second half of 2026, and that the transaction should support both growth and ROE.