If you want one stock that can quietly pay you for the next 20 or 30 years, you don’t need anything exotic. Sometimes the best answer is a blue-chip stock that is part of most income portfolios in Canada.
One such Canadian dividend stock is Bank of Nova Scotia (TSX:BNS), better known as Scotiabank. The banking giant has raised its dividend for decades, just posted a strong quarter, and has a plan that should keep the payouts flowing well into the 2030s.
Here’s why I think it deserves a spot in a “buy-and-hold” income portfolio.
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The bull case for this Canadian dividend stock
During its second-quarter fiscal 2026 earnings call (ended in April), the bank stock announced a $ 0.04-per-share dividend increase. That’s on top of a full year in which the bank returned $7.5 billion to shareholders through buybacks and dividends combined.
- Adjusted earnings came in at $2.7 billion, or $2.02 per share, and pretax pre-provision earnings jumped 16% compared to the same quarter last year.
- Return on equity landed at 13.2%, and management said it now expects to hit its 14% plus return on equity target in fiscal 2027, a full year ahead of the original schedule set out at the bank’s investor day.
- A dividend increase paired with an improving return on equity is the combination income investors want to see. It indicates management is increasing the payout as the underlying business is expanding earnings per share at a steady pace.
Scotiabank operates at scale in Canada, the United States, and Mexico, the only bank of the Big Five to do so across all three countries covered by the CUSMA trade agreement. That gives it exposure to growth in Latin America without abandoning the stability of its home market.
In the most recent quarter, international banking pre-tax pre-provision earnings rose 12% year over year, with Mexico standing out. Revenue in the region grew 8%, and earnings jumped 25%.
Meanwhile, the core Canadian banking segment delivered its fourth straight quarter of margin expansion and its third straight quarter of positive operating leverage, meaning revenue is growing faster than expenses.
The wealth management arm is also becoming a bigger growth engine. Net sales hit $4.7 billion in the quarter, up fourfold from the same period last year, marking seven straight quarters of positive flows. Return on equity in that segment was an impressive 17.9%.
At Scotiabank’s annual shareholder meeting in April, chief executive officer Scott Thomson said the bank had added more than 400,000 primary retail clients over two years and repurchased 20 million shares over the past year. He also pointed to total shareholder returns north of 35% in 2025, a number that combines both share price gains and dividends.
Chief risk officer Shannon McGinnis noted during the earnings call that impaired loan provisions are expected to settle in the mid-50 basis-point range for the rest of 2026, a touch higher than earlier guidance, due to inflationary pressures on Canadian households and a large corporate account in Brazil.
Investors should watch credit trends closely, but management framed the Brazil exposure as an isolated event rather than a sign of broader stress. The bank’s capital position remains solid, with a common equity tier-one ratio of 13.3%.
The Foolish takeaway
Scotiabank checks the three boxes that matter most for a decades-long income holding. The dividend is growing, and the business is diversified across three growing economies
For investors who want a steady and growing income base, BNS stock ticks most boxes. Notably, it has raised the annual dividend per share from $1.56 in July 2006 to $4.56 in July 2026.
