Bank of Nova Scotia (NYSE:BNS), one of Canada’s biggest lenders, trounced expectations for its first-quarter profits Tuesday, helped along by robust business from both its domestic and international units.
Scotiabank escaped a slowdown in Canada’s housing market as the Bank of Canada’s interest rate rises allowed for higher mortgage rates. It also saw robust growth in earnings from its international business, where it is expanding across Peru, Mexico, Chile and Colombia.
"Recently announced acquisitions in Chile, Colombia and Peru, all expected to close in the second half of this fiscal year, will further grow our customer base and improve our presence in the Pacific Alliance region,” said Brian Porter, Scotiabank’s president and chief executive, in a statement.
Its earnings per share for the quarter ending March 31 came to US$1.70, up from US$1.62 per share in the year-ago quarter and a far better performance than the US$1.67 per share Wall Street had expected.
The bank’s net income for the quarter amounted to US$2.18bn, up from US$2.1bn in the same-period a year ago. Its revenue, meanwhile, came to US$7.79bn in the period.
Separately, the bank announced that it will purchase up to 24mln of its common shares, or about 2% of its shares outstanding.
In the quarter, Scotiabank’s Tier 1 capital ratio, a critical indicator of a bank’s financial strength jumped to 12%, which suggests the bank is in a strong position to make further acquisitions.
In pre-market trade, Bank of Nova Scotia’s shares were flat at US$61.79.