Scotiabank Profit Climbs On Gain, Boosts Dividend

(RTTNews) - Canada's Bank of Nova Scotia (BNS, BNS.TO) or Scotiabank Tuesday reported a sharp increase in third-quarter profit, reflecting higher revenues and a gain on sale of its investment in CI Financial. Provision for credit losses increased from last year. The financial services provider boosted its quarterly dividend.

Brian Porter, president and CEO of the bank said, "Canadian Banking had a good third quarter...driven by a 5 basis point increase in the net interest margin, double digit growth in credit card and automotive lending volumes and strong growth in fee and commission revenues."

For the third quarter, net income attributable to shareholders climbed to C$2.27 billion from C$1.64 billion in the prior year. Earnings per share were C$1.85, up from C$1.36 per share in the prior-year quarter. The firm has adjusted its prior-year results.

The company said its recent-quarter earnings included C$555 million or C$0.45 per share related to sale of a majority of the bank's investment in CI Financial Corp.

On an adjusted basis, earnings totaled C$1.40, while the company posted C$1.29 per share last year.

On average, 14 analysts polled by Thomson Reuters expected earnings per share of C$1.41 for the quarter. Analysts' estimates typically exclude one-time items.

Canadian Banking reported net income attributable to equity holders was C$565 million, an increase of 3 percent from last year. International Banking net income declined C$80 million to C$410 million.

Global Wealth & Insurance net income was C$846 million, an increase of C$536 million from the same quarter last year, which included the gain from the sale of the investment in CI Financial Corp.

Global Banking and Markets posted net income of C$408 million, an year-over-year increase of 8 percent.

Total revenues for the quarter grew to C$6.49 billion from C$5.52 billion last year. On a taxable equivalent basis or TEB, quarterly revenue climbed 18 percent to C$6.58 billion from C$5.59 billion in the preceding year.

Adjusted for the notable gain and last year's gain on sale of an associated corporation of C$150 million, total revenue rose 9 percent from last year. Eleven analysts estimated revenues of C$5.90 billion for the quarter.

Net interest income increased to C$3.15 billion from C$2.93 billion a year earlier. Non-interest revenue was C$3.34 billion, up from C$2.59 billion in the same quarter last year.

Scotiabank attributed the growth in revenues to higher net interest income from asset growth and improved net interest margin, stronger non-interest revenues, including higher underwriting and banking fees and the positive impact of foreign currency translation.

Provision for credit losses advanced to C$398 million from C$314 million in the prior year.

Return on equity was 20.6 percent, compared to 17.2 percent in the previous year. Tier 1 capital ratio was 12.3 percent, compared to 11 percent a year earlier.

Scotiabank also announced a quarterly dividend of C$0.66 per share, an increase of C$0.02 per share from last year, to shareholders of record on October 7, 2014, payable on October 29.

BNS.TO closed Monday's trading at C$74.19, up 0.94 percent.