Reporting Q4 earnings this week, Canadian banks are set to post single-digit Y/Y earnings gains, with the exception of Bank of Montreal (BMO -0.9%) which has a tough comparison to a big quarter one year ago - it's expected to show a 4% Y/Y drop in profit.
CIBC (CM -0.5%) - with 80% of its total loans to Canadian consumers - is most exposed to any slowdown in domestic lending. BMO and TD Bank - on the other hand - have extensive U.S. retail operations, while Scotiabank (BNS -0.6%) does substantial business in Latin America and Asia. The slowdown in trading activity took a big toll on U.S. bank results in Q3, and Royal Bank of Canada (RY -0.8%) operates the largest capital markets operation of any of the country's Big 5.
Canadian lenders often announce dividend hikes as part of their earnings releases, and analysts expect them from BMO and CIBC (Scotia, RBC, and TD boosted payouts last quarter).