Aug 2010 Financial News

Scotiabank records 10 per cent profit hike

Aug 26, 2010

The Scotiabank Group completed its third fiscal quarter at the end of July 2010 with profit after tax of $363 million, an increase of ten per cent over the prior year, the bank said in a statement. The continuing slowdown in the local economy affected its asset base as negative credit demand continued to affect its loan portfolio and lack of suitable investments also weighed negatively on their investment securities which also contracted as existing holdings matured with no new options for reinvestment available.

Earnings per share measured 205.9 cents, which translated into Shareholders rewarded with dividends of 25 cents per share for the three months to July 31st, 2010. This brought total dividends for the year to 75 cents per share, the same as 2009. Performance ratios were maintained as increased profitability paired with a smaller asset base made the company more efficient. Return on Equity declined marginally from 22.68 per cent to 21.32 per cent while the Bank’s Return on Assets improved from 2.84 per cent to 3.09 per cent.

Profitability was maintained however, as growth in expenses did not outweigh revenue growth. Profits before tax climbed to $466.5 million compared to $424.1 million in 2009, which represented a ten per cent growth. After accounting for taxes, profits were $363 million or ten per cent higher than the comparable period in 2009. This, the release said, can be attributed to treasury management tactics employed and increased activity in the group’s Merchant Banking division which has arranged and issued several local and regional capital market issues in the period under review.

Net interest income for the period under review totalled $628.5 million representing a 3.3 per cent growth when compared to the $608.3 million netted in 2009. Other income however showed substantial growth of 27.8 per cent or $58.8 million. Overall, the group’s net interest and other income earned for the nine months to July 31st, 2010 was $899 million or 9.6 per cent. Non interest expenses (NIE) climbed to $432.3 million, which was $36.6 million higher than the prior year. Loan loss expenses remained flat at $58 million year over year.


Source:
Trinidad Guardian
Thursday August 26, 2010

http://guardian.co.tt/business/business/2010/08/26/scotiabank-records-10-cent-profit-hike