Scotiabank, BMO profits climb on domestic lending, capital markets
By Jeffrey Hodgson
TORONTO (Reuters) - Bank of Nova Scotia (BNS.TO: Quote) and Bank of Montreal (BMO.TO: Quote) posted higher third-quarter profits on Tuesday, benefiting from gains at their traditional Canadian lending arms as well as the impact of buoyant capital markets.
Results from Bank of Montreal came in ahead of investors' expectations, helping to send its stock higher. By contrast, Scotiabank shares slipped more than 2 percent after it reported a drop in profits at its international operation.
Scotiabank, Canada's No. 3 lender, said it earned C$2.35 billion ($2.15 billion), or C$1.85 a share, in the quarter ended July 31, up from C$1.75 billion, or C$1.36 a share, a year earlier.
The bank benefited from a C$555 million gain from the sale of most of its investment in fund manager CI Financial Corp (CIX.TO: Quote).
Excluding those proceeds and other non-recurring items, Scotiabank said it had earned C$1.40 a share on a fully diluted basis. Analysts had expected adjusted earnings per share of C$1.41.
Income at Scotiabank's international banking division, which spans Latin America and includes a sizable presence in Asia, slipped by C$80 million to C$410 million.
The bank said this was largely due to a non-recurring benefit last year, and excluding this item, net income rose 3 percent. But it also noted growth in Latin America and Asia was partly offset by weaker results in the Caribbean and Central America.
"You saw a little bit of slower growth internationally from Scotiabank and I think that's leading to some of the weakness today," said Tom Lewandowski, a financial services analyst for Edward Jones. Continued...