December 4, 2008 / 1:23 PM / in 9 years

CORRECTED - UPDATE 2-National Bank of Canada returns to profit

(Fixes headline and first paragraph to clarify that it returned to a quarterly profit from a loss)

* EPS C$0.37 vs loss C$1.14

* Excluding items C$1.36 vs C$1.34

* Consensus view C$1.29 (Adds special charges, analysts’ forecast, details)

TORONTO, Dec 4 (Reuters) - National Bank of Canada (NA.TO) returned to a quarterly profit helped by strong results from its personal and commercial banking sector, even though previously announced writedowns for commercial paper, staff layoffs and other items took a toll on results.

National Bank said on Thursday it earned C$70 million ($55.4 million), or 37 Canadian cents a share, in the fourth quarter, ended Oct. 31. That was up from the year-earlier period, when it lost C$175 million, or C$1.14 a share, because of a big charge for the repurchase of asset-backed commercial paper from clients.

Montreal-based National Bank, Canada’s sixth-largest bank, disclosed on Nov. 26 that it would take charges totaling C$237 million before tax in the quarter due to further writedowns of asset-backed commercial paper, an internal restructuring that will cut 400 jobs, and a writedown of tangible assets.

The results for the quarter include a C$117 million loss related to the impact of asset-backed commercial paper, a C$66 million loss due to restructuring charges, and a C$54 million loss resulting from a writeoff of tangible assets.

Excluding unusual items, the bank said it earned C$228 million, or C$1.36 a share, up from C$217 million, or C$1.34, a year earlier. On that basis, analysts had expected a profit of C$1.29 a share, according to Reuters Estimates.

“During the fourth quarter, we streamlined our organizational structure, which had an impact on our results,” Louis Vachon, president and chief executive, said in a release.

“However, this initiative will enable us to better serve our clients and cope with the economic conditions we will face in the coming quarters.” ($1=$1.26 Canadian) (Reporting by Scott Anderson; editing by John Wallace)

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