Scotiabank today reported third quarter net income of $1.01 billion compared with $1.03 billion the same period last year. Quarter over quarter, net income was up 3% from $980 million, due primarily to higher net interest income, increased customer-driven revenues and strong trading results.
Third quarter highlights;
- Earnings per share (diluted) of $0.98 compared to $1.02 last year and $0.97 last quarter
- Net income of $1.01 billion, versus $1.03 billion last year and $0.98 billion last quarter
- Return on equity of 21.0%, compared to 21.7% last year
- Productivity ratio of 54.3%, versus 53.0% last year
Diluted earnings per share were $0.98 compared to $1.02 in the same period a year ago and $0.97 last quarter. Return on equity remained strong at 21.0%.
"Scotiabank's strategy of diversifying across business lines and geographies has enabled the Bank to continue to perform well during a challenging period for the global financial services industry," said President and CEO Rick Waugh. "Total revenue grew 5% from the same period last year, as assets increased a strong $54 billion or 13%, with contributions from all three growth platforms - Domestic Banking, International Banking and Scotia Capital. These gains were offset by higher provisions for credit losses in some of our retail portfolios, lower capital markets revenues compared to record levels for the same period last year and higher expenses to support growth initiatives. Scotiabank continues to deliver an industry-leading productivity ratio of 54.3%, reflecting our effective cost management discipline. Our balance sheet remains strong and our capital ratios are excellent.
"Domestic Banking reported a record quarter, with total revenue increasing by 9% compared to a year ago," Mr. Waugh said. "Mortgage growth was recorded in all sales channels, leading to a gain in market share, while personal deposits grew 12% to lead the industry in market-share growth. The business line also benefited from higher wealth management revenues, including a gain in mutual fund market share for the sixth consecutive quarter and growth in commercial and small business lending.
"Results in International Banking benefited from continued robust organic loan growth, particularly in mortgages and credit cards, strong deposit gains and the positive impact of acquisitions, partly offset by higher taxes and increased provisions for credit losses.
"Scotia Capital had a strong quarter, benefitting from its diversified portfolio of businesses, with record revenues in Scotia Waterous and fixed income, continued strong contributions from ScotiaMocatta and foreign exchange operations and an increased contribution from its lending businesses. This was partly offset by lower results in derivatives, which achieved record levels in the same quarter last year.
"The Bank's risk management culture is enabling us to effectively manage through a difficult period in world capital markets.
"Our capital position remains strong, allowing the Bank to continue to pursue strategic acquisitions and ongoing business development opportunities.
"The second half of 2008 is showing improvement compared to the first two quarters of the fiscal year, with continued asset growth in all three business lines and a rebound in capital markets activity. While we are on track to achieve three of our four key financial and operational targets, with slower global growth it is unlikely that we will meet our EPS growth objectives as set at the end of last year." -- www.cnxmarketlink.com
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