National Bank reports 'record' Q3 net earnings of $419M; revenue up 5%
A branch of the National Bank is shown on December 8, 2011, in Montreal. National Bank announced Thursday, Dec. 6, 2012, that its quarterly dividend will go up in the new year, following a fourth quarter that saw its net income rise 20 per cent over the same time last year. (Ryan Remiorz / THE CANADIAN PRESS)
Published Wednesday, August 28, 2013 8:34AM EDT
MONTREAL -- National Bank (TSX:NA) is reporting what it calls record results for the third quarter with per share earnings that beat analyst estimates.
The Montreal-based bank reported Wednesday that it earned $419 million or $2.39 per diluted share in net income in the latest period, up from $379 million or $2.14 in the same period last year.
Revenue rose five per cent to $1.29 billion from $1.22 billion.
Ex-items, net income was a record $391 million or $2.22 per diluted share, up 11 per cent from $353 million or $1.98 per share in the same 2012 period.
National Bank was expected to earn $2.06 per share in adjusted profits on $1.3 billion in revenues in the third quarter, according to analysts polled by Thomson Reuters.
"Thanks to sustained growth across its three business segments, National Bank reported record net income in the third quarter of 2013," president and CEO Louis Vachon said in releasing the bank's earnings report.
"Our credit quality and financial strength remain excellent, and our Pan-Canadian growth strategy has paid off with strong performance in the wealth management and financial markets segments."
"Furthermore, the Bank continues to seek out opportunities, as was the case for the acquisition of TD Waterhouse Institutional Services announced on Aug. 1," he said.
Earlier this month, it announced it was entering into an agreement to pay $250 million for TD Waterhouse Institutional Services, which provides back-office and support solutions for portfolio managers and brokers across the country.
The deal, which is expected to close later this year, is still subject to regulatory approvals and other conditions.
National Bank said it will add 260 additional market intermediaries who serve 130,000 client accounts and manage approximately $34 billion in assets. Through its Correspondent Network, it already oversaw 350,000 client accounts with client assets of $50 billion.
The bank said the acquisition will help it increase its payout of recurring earnings per share by 12 cents in 2014, and 14 cents the year after.
National Bank is Canada's sixth-largest bank, with about $185 billion in assets and close to 20,000 employees across the country.
National is the third large Canadian bank to report this week. Scotiabank (TSX:BNS) and Bank of Montreal (TSX:BMO) both reported Tuesday. Royal Bank (TSX:RY), Toronto-Dominion (TSX:TD) and CIBC (TSX:CM) report on Thursday.