The Bank of Nova Scotia (TSE:BNS) is the big winner in a recent earnings review of Canada’s six banks for the year 2012. Analysts at National Bank Financial released their updated review of earnings for the banks this week.

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According to the report, The Bank of Nova Scotia (TSE:BNS) is their top pick with a price target of $63 and an Outperform rating. They believe Canadian consumers are “exhausting their capacity to borrow,” so they feel that the defensive qualities of The Bank of Nova Scotia (TSE:BNS) will be beneficial to its earnings for 2013.

Analysts’ second pick out of Canada’s top banks is Toronto-Dominion Bank (NYSE:TD), which they gave a price target of $91 and an Outperform rating. National Bank Financial rated Toronto-Dominion Bank (NYSE:TD) just slightly below BNS because of the near-term challenges revealed in the bank’s fourth quarter results. One of the main challenges they see is the integration of the MBNA Canada credit card, which will cost $150 to $250 million in technology implementation. However they do see that Toronto-Dominion Bank (NYSE:TD) is growing steadily in the U.S., and they favor its growth prospects over the remaining four banks on the list.

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They ranked Bank of Montreal (NYSE:BMO) in third place on the list, setting their price target at $64 and giving it a Sector Perform rating. Because Bank of Montreal (NYSE:BMO) does not rely on lending to Canadian households and has good potential for growth in the U.S., they feel that it should do well in the coming year.

Fourth on the list is Royal Bank of Canada (NYSE:RY) with a price target of $62 and a Sector Perform rating. National Bank Financial analysts believe the bank’s biggest risk is its heavy reliance on the Canadian banking segment. Eighty percent of the bank’s net earnings came from Canada, while 11 percent came from the U.S. and 9 percent came from elsewhere. Because the segment requires growth in household borrowing in Canada, they don’t see Royal Bank of Canada (NYSE:RY) doing as well as its competitors in 2013.

National Bank Financial rated the Canadian Imperial Bank of Commerce (NYSE:CM) (TSE:CM) fifth on the nation’s top six banks. Analysts set their price target for the bank at $82 and gave it an Underperform rating. Like Royal Bank of Canada (TSE:RY) (NYSE:RY), Canadian Imperial Bank of Commerce (NYSE:CM) (TSE:CM) also relies heavily on lending in Canada. About 70 percent of the bank’s income is from its retail and business banking segment, and half of the bank’s total assets are loans to households, so analysts believe it will be one of the hardest hit banks in Canada in the coming year.

Analysts did not rate National Bank of Canada (TSE:NA). They expect the bank to continue repurchasing its shares over the next two years.