(February 29) – Bank of Nova Scotia is reporting first-quarter earnings in line with analyst expectations at 79¢ per share.
Earnings are up 13% year over year and return on equity increased to 15.9% from 14.8% in the first quarter of last year. Peter Godsoe, chairman and CEO at Scotia, says, “Our domestic banking operations, including wealth management, led the increase in earnings, achieving strong loan and deposit growth and large gains in brokerage revenues. International banking also performed well, due to steady growth in the Caribbean and the broadening economic recovery in Asia.”
Wealth management revenues are up 26% from Q1 1999, driven primarily by stronger brokerage fees. Residential mortgage and credit card volumes were up 8% and 11% respectively. Sales of stock-indexed GICs pushed personal deposits up 6%.
On the wholesale side, earnings were down by $69 million year over year due to large one-time gains in the period last year. Investment banking revenues were $135 million, a decline of $35 million, due to lower underwriting fees and trading income. Earnings were up slightly compared with the fourth quarter. “The Scotia Capital reorganization is proceeding extremely well, and customers are pleased with the new, integrated approach to their business,” Godsoe said.
Scotia’s vaunted international strategy remains unvindicated so far. The bank says its Caribbean businesses performed well, the Asian operations “continued to improve,” and “In Latin America we are laying the foundation for longer-term earnings growth.”
– IE Staff