Scotiabank expects KeyCorp lift, but Chile tax cut trims Q4 (NYSE: BNS)

What happened

The Bank of Nova Scotia (NYSE: BNS) said it expects a CAD $96 million Q4 2026 contribution from KeyCorp.

Scotiabank said the figure reflects its share of KeyCorp's Q3 2026 net income. It includes acquisition-related and other accounting impacts, is net of funding costs, and is reported on a one-month lag.

After about CAD $8 million of amortization of acquired intangible assets, the adjusted contribution rises to about CAD $104 million.

The release also says Chile approved a 4% cut in the corporate income tax rate over the next three years, to 23%.

That change is expected to cause a one-time deferred tax asset write-down and cut the Bank and International Banking segment's fourth-quarter reported and adjusted earnings by about CAD $55 million.

Key numbers

Metric	Latest	Change	Source
Expected net income contribution from KeyCorp in Q4 2026	approximately CAD $96 million		SEC 6-K press release
Adjusted net income contribution from KeyCorp	approximately CAD $104 million		SEC 6-K press release
Amortization of acquired intangible assets	approximately CAD $8 million		SEC 6-K press release
Expected reduction to the Bank and International Banking segment's fourth quarter reported and adjusted earnings	approximately CAD $55 million		SEC 6-K press release

Read more: The Bank of Nova Scotia (BNS) stock analysis and investment case

Why it matters

The filing gives investors a clear fourth-quarter earnings bridge from KeyCorp and a separate tax hit from Chile.

OptimistFi's calculation shows the adjusted KeyCorp contribution is about CAD $8 million higher than the unadjusted estimate.

That helps show how much of the quarter comes from the stake and how much comes from the tax item.

Scotiabank also separates the accounting effects from the ownership contribution.

That matters because the amortization figure matches the gap between the two KeyCorp estimates.

The Chile item is a separate one-time charge.

This makes the announcement easier to read as a bridge, not a change in the operating trend.

It also gives a benchmark for the December call.

Both amounts are expected, not reported, and the Chile item is a one-time deferred tax asset write-down.

The quarter can still come in differently than this release suggests.

The filing therefore points to a mixed near-term read rather than a clean earnings step-up.

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What's next

Scotiabank will release fourth-quarter financial results and host an earnings conference call on December 2, 2026.

That is the next check on whether the KeyCorp contribution lands near the CAD $96 million estimate and whether the Chile tax hit stays close to CAD $55 million.

Results near those figures would support the guidance in this release.

A larger miss on either line would weaken it and make the quarter harder to read as a simple bridge from ownership income to reported earnings.

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