National Bank posts higher quarterly profit, beating analysts’ expectations
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- National Bank of Canada reported net income of $1.31-billion, or $3.25 per share, for the three months ended July 31, up 23% from a year earlier.
- National Bank of Canada earned an adjusted $3.39 per share, exceeding the $3.21-per-share analyst expectation compiled by S&P Capital IQ.
- National Bank of Canada increased total revenue 18% to $4.05-billion, while expenses rose 9% to $2.09-billion because of higher variable compensation and litigation costs.
- National Bank of Canada set aside $246-million for credit losses, up from $203-million in the same quarter last year and above analysts’ expectations.
- Personal and commercial banking profit rose 14% to $421-million, with personal lending growing 13% and commercial lending increasing 4%.
- Wealth management profit climbed 21% to $296-million on higher fee-based revenue, while National Bank continued a strategic review of its personal and commercial business.
Why it matters: National Bank’s $1.31-billion net income and $3.39 adjusted EPS beat expectations, but its $246-million credit-loss provision was higher than expected and $43-million above last year. The result shows strong growth in market-sensitive and fee-based businesses alongside a larger allowance for potentially defaulting loans.
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