When markets get rocky, and headlines scream recession, many Canadians begin enthusiastic about the place to park their money. And with good cause. In response to a June 2025 report from BMO, issues about inflation, recession, and job safety jumped sharply from March to April. In truth, 76% of Canadians now say they’re extra involved about inflation, and 58% are extra anxious about their private funds. In instances like these, traders usually flip to reliable dividend shares to offer stability and revenue. Top-of-the-line examples on the TSX proper now could be Financial institution of Nova Scotia (TSX:BNS).
Why Scotiabank?
Scotiabank, one among Canada’s Huge 5 banks, has been a pillar of economic energy for almost two centuries. It’s identified for paying dividends yearly since 1833. Proper now, the dividend inventory is down about 6% 12 months to this point. However whereas the share value slipped, the dividend hasn’t. In truth, it’s holding regular with a really enticing yield of 5.8% as of writing. That’s nicely above the TSX common and better than most financial savings accounts or Assured Funding Certificates (GICs). And better of all, that dividend is backed by strong fundamentals. A $7,000 funding may usher in $402.80 in annual revenue at writing via dividends alone!
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY | INVESTMENT TOTAL |
|---|---|---|---|---|---|---|
| BNS | $72.93 | 95 | $4.24 | $402.80 | Quarterly | $6,928.35 |
In its second quarter 2025 earnings report, Scotiabank posted web revenue of $2.03 billion, or $1.52 per share. Whereas that got here in a bit under the $1.56 anticipated, it nonetheless represents a robust exhibiting in a turbulent financial system. Revenues hit $8.35 billion, supported by positive factors in International Wealth Administration and Worldwide Banking. Wealth revenue was up 17% from a 12 months in the past, whereas worldwide earnings climbed 7%. These segments are serving to to stability out weaker outcomes from Canadian Banking, the place web revenue fell 31%, largely as a result of rising provisions for credit score losses.
Staying robust
These provisions are a part of the financial institution’s cautious stance amid financial uncertainty. The frequent fairness tier-one ratio, which measures monetary energy, stays strong at 13.2%. That provides Scotiabank a robust buffer in case the financial system will get worse. Administration additionally introduced a buyback program for as much as 20 million shares, signalling confidence within the dividend inventory’s long-term outlook.
Regardless of short-term challenges, this can be a financial institution that is aware of how you can play the lengthy sport. It has a various income stream, with operations in Latin America and the Caribbean, giving it publicity to faster-growing markets. Whereas that provides some threat, it additionally gives extra methods to develop earnings over time. Its concentrate on digital banking and price management also needs to assist it keep aggressive.
Going for development
For income-focused traders, the dividend is actually the spotlight right here. At 5.8%, it gives regular revenue even when the inventory stays flat. And with a payout ratio of round 50%, it seems sustainable. The financial institution has a historical past of accelerating its dividend when earnings develop, and whereas hikes could also be paused for now, the long-term pattern is clearly upward. Holding a inventory like this may provide highly effective compounding advantages, particularly in case you reinvest the dividends.
Moreover, this has been a multi-bagger inventory for years. Shares of Scotiabank are up 14% within the final 12 months, 48% within the final 5 years, and a whopping 316% within the final 20. But it’s true that Scotiabank isn’t a flashy development inventory. It’s a gentle, dependable monetary establishment with a protracted historical past and robust foundations. It’d take time for the share value to get better, however when you wait, you’re gathering money each quarter. In at the moment’s surroundings of upper inflation and financial jitters, that’s not a foul place to be.
Backside line
The BMO survey reveals that Canadians are paying nearer consideration to their monetary future. Many are anxious, however they’re additionally making smarter selections. And for these seeking to trip out the storm, Scotiabank gives a traditional mixture of revenue, worth, and resilience. It’s not proof against market noise, however its dividend is about as iron-clad because it will get on the TSX. That form of dependability is uncommon and, in instances like these, price holding on to.
