February 24, 2014 / 10:14 PM / 5 years ago

National Bank of Canada profit rises on wealth, markets

TORONTO (Reuters) - National Bank of Canada (NA.TO), the country’s sixth-largest lender, said on Monday its first-quarter profit rose 9 percent, driven by stronger wealth management and financial markets income.

The Montreal-based bank earned C$405 million ($365.87 million), or C$1.15 a share, in the fiscal first quarter ended January 31. That compared with a year-before profit of C$373 million, or C$1.05 a share.

Excluding certain items, including a gain on the rise of fair value of certain restructured notes and a reduction in pension-related service costs, the bank earned C$1.09 a share. That exceeded analysts’ expectations of a profit of C$1.05 a share, according to Thomson Reuters I/B/E/S.

Wealth management income jumped 42 percent to C$68 million, helped by the C$250 million acquisition of TD Waterhouse’s Institutional Services Business, which was completed in November.

National and its Canadian peers have been seeking to add to their wealth management businesses in order to offset sluggish growth in Canadian consumer lending profits.

Indeed, personal and commercial banking income rose a meager 3 percent to C$168 million, as personal lending grew 7 percent and commercial lending increased by 5 percent from a year ago, while net interest margins narrowed to 2.25 percent from 2.32 percent.

Profit from the bank’s financial markets arm rose 27 percent to C$144 million.

The bank’s shares, which rose 14.4 percent last year, but have decreased slightly in 2014, rose 11 Canadian cents to C$43.61 on Monday before the results were released.

National is the first Canadian bank to report first-quarter results. Bank of Montreal (BMO.TO), the country’s No. 4 player, will release results early on Tuesday.

($1 = 1.1069 Canadian dollars)

Reporting by Cameron French; Editing by Jonathan Oatis

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