TORONTO (Reuters) – In a tough year for Canadian banks, shares in mid-sized lender EQB Inc jumped more than 50% on solid earnings growth, making it the best-performing banking stock in 2023, with investors expecting more gains this year.
The Toronto-based digital bank has no physical branches, which has helped keep costs under check while many of the bigger institutions had to cut jobs as they grappled with an inflated cost base.
EQ Bank, Canada’s seventh-largest bank, grew its adjusted net income last fiscal year by 11.2% while the big banks recorded between 0.7% growth and a 23% fall in earnings.
EQ’s non-interest expenses rose 15.5% while at the top three banks they rose over 20%. CIBC
Now shareholders are betting that EQ’s attractive mortgage products and its C$495 million acquisition of Concentra Bank in 2022 will drive earnings.
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