Bank of Nova Scotia Still Has More International Repositioning in 2025

Bank of Nova Scotia is the third-largest Canadian-based bank by assets and it is known as Canada’s most international bank as it derives a little over half of its revenue from Canada, over 40% from international operations (primarily Latin America), and a high single-digit percentage from the US. Scotiabank’s Latin America exposure gives the bank the potential for higher growth and return opportunities compared with peers, but it also exposes the bank to more risks as we've seen during the pandemic. The bank has been reworking its Latin America footprint, reducing exposure to businesses and geographies that are less favorable and also aiming to achieve larger scale in some countries. We would like to see Scotiabank achieving better risk-adjusted margins in these markets as credit costs often weigh on the bank’s total returns.