Credit ChallengesHigher impaired PCLs drove the cash EPS miss and, more importantly, management suggested the impaired PCL rate could remain around this level in the next two quarters.
Credit IssuesCredit challenges drive elevated PCL guidance. Impaired PCLs of 41bps in the quarter were significantly above both consensus and Q1 levels driven by a stark increase in US Commercial Banking and a one-time provision in Capital Markets.
Earnings PerformanceUS P&C banking adjusted PTPP earnings fell short of estimates, driven by lower NIMs and higher expenses.