Both banks set more money aside to cover potential bad loans, flagging the provisions as drags on their profits in their third-quarter results released Tuesday. Scotiabank set about $1.1 billion aside for credit losses in the quarter, up from $819 million the previous year, while BMO raised its provision for bad loans to $906 million, up from $492 million last year. (The Logic)

Talking point: Canada’s banks are reporting their quarterly earnings in a challenging economy. After years of battling post-pandemic inflation, central banks in Canada and the U.S. look increasingly likely to cut rates in the fall, bringing relief to borrowers. But relief isn’t here yet, putting strain on the homeowners and businesses who owe money to the banks. On a call with analysts, BMO CEO Darryl White said he’s expecting an economic recovery to begin in 2025. BMO and Scotiabank both reported respective profits of about $1.9 billion, below analyst expectations for BMO and above them for Scotiabank.