Best Canadian Bank Stocks to Buy in 2026

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Canadian bank stocks have long been the backbone of dividend portfolios across the country. With Q3 earnings season scheduled for August 25-28, now is the time to evaluate which of the Big Six banks deserve a spot in your portfolio. This guide ranks the best Canadian bank stocks heading into the second half of 2026, based on valuation, dividend strength, and long-term investment thesis.

If you’re looking for a detailed yield comparison, read our recent analysis on Canadian bank dividend stocks. This piece takes a different approach — a ranked buy guide with an investment thesis for each bank.

Why Canadian Bank Stocks Now?

The Big Six Canadian banks are trading near 52-week highs after four consecutive record closes on the TSX this week. Soft U.S. inflation data has supported credit-sensitive shares, and the Bank of Canada’s overnight rate has held at 2.25% since July. With Q3 earnings around the corner, these results will be the next near-term catalyst for bank share prices.

None of the Big Six has cut its dividend in decades — they maintained payouts even through the 2008 financial crisis. For Canadian investors seeking reliable income and long-term stability, bank stocks remain a core holding category alongside dividend stocks more broadly.

#1 Royal Bank of Canada (RY.TO)

Rating: ⭐⭐⭐⭐⭐
52 Week Range: $187.79 – $306.38
Market Cap: $416.1B
PE Ratio (TTM): 19.5
EPS (TTM): $15.39
Earnings Date: Thursday, August 27 (scheduled)
Forward Dividend & Yield: $7.04 (2.35%)

Data as of August 14, 2026. Source: Yahoo Finance.

Royal Bank of Canada is Canada’s largest bank by market cap and our top-ranked pick for 2026. RBC’s sheer scale gives it competitive advantages in capital markets, wealth management, and retail banking that the others simply cannot match. At a 41% payout ratio, RBC has the most room among the Big Six to continue growing its dividend over time.

The bank’s diversified revenue streams — from Canadian retail to U.S. wealth management — provide stability that single-focus competitors lack. RBC’s valuation at 19.5 times trailing earnings reflects this quality premium, but we think it’s justified.

The risk to watch: RBC’s exposure to Canadian housing through its retail mortgage book remains a watch item as mortgage renewals continue. That said, with the Bank of Canada holding rates at 2.25%, the pressure has eased compared to 2024-2025.

#2 Toronto-Dominion Bank (TD.TO)

Rating: ⭐⭐⭐⭐⭐
52 Week Range: $100.01 – $175.33
Market Cap: $283.5B
PE Ratio (TTM): 20.2
EPS (TTM): $8.51
Earnings Date: Thursday, August 27 (scheduled)
Forward Dividend & Yield: $4.48 (2.61%)

Data as of August 14, 2026. Source: Yahoo Finance.

TD Bank has rebounded sharply from its 52-week low of $100.01, now trading at $171.58. With a 50% dividend payout ratio, TD sits comfortably in the middle of the pack in terms of dividend sustainability.

TD has a substantial U.S. retail footprint, and that dual-market exposure is both a strength and a complexity. When U.S. retail banking performs well, TD’s earnings benefit. When regulatory or economic headwinds hit south of the border, TD feels it more than peers.

At 20.2 times trailing earnings, TD trades at the second-highest multiple of the group. We think the current valuation is fair given the rebound trajectory, but there’s less margin for disappointment than with cheaper peers like CIBC.

#3 National Bank of Canada (NA.TO)

Rating: ⭐⭐⭐⭐
52 Week Range: $141.46 – $237.13
Market Cap: $89.0B
PE Ratio (TTM): 20.4
EPS (TTM): $11.31
Earnings Date: Wednesday, August 26 (scheduled)
Forward Dividend & Yield: $5.28 (2.31%)

Data as of August 14, 2026. Source: Yahoo Finance.

National Bank is the smallest of the Big Six by market cap, but it trades at the highest P/E multiple at 20.4 times trailing earnings — a premium investors have been willing to pay. It is also the most regionally concentrated of the six, with its retail base centred in Quebec.

National Bank’s smaller size can be an advantage — it’s nimbler than RBC or TD, and less exposed to the international complexities that weigh on Scotiabank. The 43% payout ratio leaves plenty of room for dividend growth.

The risk: National Bank’s Quebec concentration means its fortunes are more tied to a single regional economy than the more diversified giants. If Quebec’s economy slows, National Bank will feel it more acutely.

#4 Canadian Imperial Bank of Commerce (CM.TO)

Rating: ⭐⭐⭐⭐
52 Week Range: $100.43 – $171.64
Market Cap: $155.6B
PE Ratio (TTM): 16.9
EPS (TTM): $10.07
Earnings Date: Thursday, August 27 (scheduled, before open)
Forward Dividend & Yield: $4.28 (2.51%)

Data as of August 14, 2026. Source: Yahoo Finance.

CIBC is the cheapest of the Big Six on a trailing earnings basis at just 16.9 times. That discount exists for a reason — CIBC’s heavy exposure to the Canadian housing market makes it the most sensitive to mortgage credit risk. But if you believe Canadian housing remains stable, CIBC offers the best value entry point among the banks.

With a 40% payout ratio tied with RBC for the lowest of the group, CIBC’s dividend is well-covered by earnings. The bank has been working to diversify its revenue mix beyond Canadian mortgages, but progress has been slower than some investors would like.

The thesis here is straightforward: you’re buying Canada’s most leveraged play on the Canadian consumer at a discount valuation. If housing holds up and the Canadian economy avoids a sharp downturn, CIBC’s valuation gap should narrow.

#5 Bank of Montreal (BMO.TO)

Rating: ⭐⭐⭐⭐
52 Week Range: $155.58 – $258.21
Market Cap: $179.7B
PE Ratio (TTM): 19.7
EPS (TTM): $13.01
Earnings Date: Tuesday, August 25 (scheduled)
Forward Dividend & Yield: $6.84 (2.67%)

Data as of August 14, 2026. Source: Yahoo Finance.

Bank of Montreal has the longest dividend history of any Canadian company — it has paid dividends continuously since 1829. That 197-year track record is unmatched, and it speaks to the stability and shareholder focus that defines BMO’s culture.

BMO’s 51% payout ratio is slightly above the middle of the pack, and its 2.67% yield is competitive without being a red flag. BMO has been expanding its footprint south of the border, and execution there will be a key factor in the years ahead.

The risk with BMO is that its U.S. expansion story is still being written. If that expansion delivers strong returns, BMO could re-rate higher. If it underperforms, the valuation could compress.

#6 Bank of Nova Scotia (BNS.TO)

Rating: ⭐⭐⭐
52 Week Range: $78.22 – $126.87
Market Cap: $153.9B
PE Ratio (TTM): 17.4
EPS (TTM): $7.25
Earnings Date: Tuesday, August 25 (scheduled)
Forward Dividend & Yield: $4.56 (3.62%)

Data as of August 14, 2026. Source: Yahoo Finance.

Scotiabank offers the highest dividend yield of the Big Six at 3.62%, but that yield comes with trade-offs. The bank’s 61% payout ratio is the highest of the group, leaving less room for dividend growth compared to peers. Scotiabank’s international exposure — particularly in Latin America — adds both opportunity and complexity to the investment thesis.

Scotiabank’s first dividend payout dates back to July 1833, making it one of the oldest dividend payers in Canada. The bank has a long history of navigating economic cycles, and its 17.4 times trailing earnings multiple is the second-lowest of the group.

For income-focused investors willing to accept a higher payout ratio and international risk, Scotiabank’s 3.62% yield is compelling. For growth-focused investors, the limited dividend growth runway and geographic complexity make it the least attractive of the Big Six at current prices.

What to Watch When the Banks Report (August 25-28)

The Big Six will report Q3 earnings over four days starting Tuesday, August 25. Here’s the schedule:

• Tuesday, August 25: Bank of Montreal, Scotiabank
• Wednesday, August 26: National Bank
• Thursday, August 27: Royal Bank, TD Bank, CIBC (before open)

Key items to watch across all six banks:

1. Net interest margins: How are margins holding up with the Bank of Canada’s overnight rate at 2.25%?
2. Provision for credit losses: Any signs of deterioration in loan quality, particularly in consumer credit and mortgages?
3. Capital markets revenue: Wealth management and investment banking results will show whether fee income is holding up.
4. Guidance: What are management teams saying about the rest of 2026?

These results will be the next near-term catalyst for bank share prices. Results could move prices in either direction, so this guide is positioning and education — not a trade call.

For broader macro context, Canada’s July CPI report releases Monday, August 17 at 8:30am ET. You can read our preview here.

Risks to Consider

All six banks are trading near 52-week highs after four consecutive record TSX closes this week. That creates entry point risk — buying at the top of the range means less margin of safety if results disappoint or the broader market corrects.

Canadian housing and consumer credit exposure remains a watch item across the sector. While the Bank of Canada holding rates at 2.25% has eased pressure compared to 2024-2025, mortgage renewals are an ongoing consideration for all six banks.

Scotiabank’s higher yield reflects its higher payout ratio and international exposure to Latin America. That geographic diversification can be a strength when Canada slows, but it adds complexity and currency risk that the domestically focused banks don’t carry.

Finally, Q3 earnings on August 25-28 are a near-term event risk. These are positioning recommendations, not predictions about what the banks will report next week.

How to Buy Canadian Bank Stocks

Canadian bank stocks trade on the Toronto Stock Exchange (TSX) and are available through any Canadian brokerage account. You can hold them in a TFSA, RRSP, or non-registered account depending on your tax situation and investment goals.

Ready to start building your Canadian bank stock portfolio? Open a Questrade account today and get $50 in free trades. Questrade offers the lowest commissions for Canadian investors and ETFs are always free to buy. Open your Questrade account here.

For more guidance on choosing the right platform, read our full breakdown of the best investing apps in Canada.

Frequently Asked Questions

Are Canadian bank stocks a good buy in 2026?

Canadian bank stocks offer a combination of dividend income, long-term stability, and exposure to the Canadian economy. All six banks maintained dividends through the 2008 financial crisis and continue to pay reliable income today. With Q3 earnings scheduled for August 25-28, we’ll get updated visibility into credit quality, margins, and management guidance for the rest of the year.

Which Canadian bank stock pays the highest dividend?

Scotiabank (BNS.TO) pays the highest dividend yield of the Big Six at 3.62% as of August 14, 2026. However, it also has the highest payout ratio at 61%, which limits room for future dividend growth compared to peers like RBC (41% payout) or CIBC (40% payout).

What is the safest Canadian bank stock?

Royal Bank of Canada (RY.TO) is our pick for the safest of the Big Six due to its scale, diversification, and lowest payout ratio at 41%. RBC is Canada’s largest bank by market cap and has the most conservative dividend policy, giving it the most room to navigate economic downturns without cutting its dividend.

When do Canadian banks report Q3 earnings?

The Big Six Canadian banks report Q3 2026 earnings between August 25-28. BMO and Scotiabank report Tuesday, August 25. National Bank reports Wednesday, August 26. RBC, TD, and CIBC all report Thursday, August 27.

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Disclaimer: The content on bestcanadianstocks.ca is for informational and entertainment purposes only and does not constitute financial advice. Past performance is not indicative of future results. Always consult a qualified financial advisor before making investment decisions. Data as of August 14, 2026.