Topic: How To Invest

BANK OF NOVA SCOTIA $54.53 – Toronto symbol BNS

BANK OF NOVA SCOTIA $54.53 (Toronto symbol BNS: Shares outstanding: 1.1 billion; Market cap: $58.1 billion; TSINetwork Rating: Above Average; Div. yield: 3.8%, www.scotiabank.com) is the third largest of Canada’s five big banks, with assets of $567.7 billion.

Excluding one-time items, the bank earned $1.14 a share in the quarter ended July 31, 2011. That’s up 16.3% from $0.98 a share a year earlier. The bank continues to set aside less money to cover bad loans because of the improving economy. Loan-loss provisions fell 12.0%, to $243 million from $276 million a year earlier.

The Canadian banking division’s earnings rose just 4.1%, due to strong competition for depositors. However, the international-banking division’s earnings jumped 20.7%, thanks to strong demand for business and consumer loans. As well, Bank of Nova Scotia recently bought Uruguay’s fourth-largest private bank, and this acquisition also contributed to the higher earnings.

The wealth-management division’s earnings rose 12.7%, mostly because the bank recently bought the 82% of DundeeWealth Inc. that it did not already own. Earnings at the Scotia Capital trading division fell 5.3%. This division’s earnings tend to be more erratic than those of Scotia’s other businesses.

Bank of Nova Scotia is still a safety-conscious buy.

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