ZWB - BMO Covered Call Canadian Banks ETF

Back by popular demand, we’re revisiting our BMO ETFs 2026 outlook. In this replay episode, join Bipan Rai and host Erika Toth as they break down key trends, highlight top ETF opportunities, and share strategies to help investors stay resilient in the months ahead.  Erika Toth is Director and Head of ETF and Portfolio Consulting at BMO Global Asset Management (BMO GAM). Bipan Rai is Head of ETF Strategy, Exchange Traded Funds at BMO GAM. This episode was recorded live on Wednesday, January 7, 2026.

The end of the year is a special time. The slowing modulation of the markets gives many an analyst time to unplug, which inevitably leads to reflection about what the next year will bring. And as ideas begin to take shape, convictions start to form and a general sense of where the market is headed is reached.

It is almost always a humbling exercise.

For instance, just consider a subset of the important macro/​market events from this year

In this episode, Sohrab Movahedi, Bipan Rai, and your host, Skye Collyer, delve into Q4 Canadian bank earnings, touching on what’s driving growth and the unifying theme of resilience through diversification. They also share their 2026 outlook for the Big Six.

Diversification Driving Growth: Despite the slowest loan growth in decades, Canadian banks delivered nearly 10% revenue growth, with non-interest income (trading and fee-based) now making up 54% of total revenues.

Mixed Core Performance & Cautious Outlook: Capital markets and wealth management were strong, while traditional lending lagged; banks remain cautious on credit risk, increasing provisions for non-impaired loans.

Valuation & Strategy Implications: Robust capital positions support dividends and buybacks, creating rationale for an equal-weight beta exposure such as ZEB. For those with valuation concerns, we suggest covered call strategies like ZWB to smooth returns and limit volatility.

As Canadian banks report fiscal year-end earnings, investors may consider buying BMO’s Bank ETFs for their upside potential, diversification and steady cash flow.

Canada’s latest budget marks a major pivot toward long-term growth, with C$115B in infrastructure spending alongside substantial allocations for defense and housing. Alongside those investments, the Feds are encouraging private sector participation via regulatory streamlining and tax incentives.