Scotiabank reports $1.3B third-quarter profit, provisions for credit losses climb
Bank of Nova Scotia's profit was weighed down in its latest quarter by mounting provisions for bad loans and its Latin American operations.
The Toronto-based bank revealed Tuesday that its third-quarter profit slipped to $1.30 billion from $1.98 billion a year ago, while its provisions for credit losses totalled $2.18 billion for the quarter, up from $713 million in the year prior and $1.85 billion last quarter.
"We know that structural damage has been done to the economy. It's going to require a lot of quarters of clean up from here, but we do view this quarter's PCL as our high-water mark," Daniel Moore, the bank's chief risk officer, said in a conference call with financial analysts.
"We see it decline substantially from here, and we're well provisioned on the balance sheet to cover our current estimate of future net write-offs."
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His remarks came as the bank said its profit amounted to $1.04 per diluted share for the quarter ended July 31, compared with $1.50 per diluted share a year earlier.
Revenue totalled $7.73 billion, up from $7.66 billion in the same quarter last year.
On an adjusted basis, Scotiabank says it earned $1.04 per diluted share in the quarter, down from an adjusted profit of $1.88 per share in the same quarter last year.
Analysts on average had expected an adjusted profit of $1.11 per share, according to financial markets data firm Refinitiv.