National Bank earnings fall by half in the second quarter
The profit of the
National Bank (Tor., NA) dropped by almost half in the second quarter, due to the important provision that the Montreal financial institution has taken for loan losses in the oil and gas sector
For the three months ended April 30, the company led by Louis Vachon posted a profit of $ 210M, or $ 0.52 per share, compared to $ 404m or $ 1.13 share in the same quarter a year earlier.
This decline is mainly due to a sectoral allowance of $ 183M related credit losses to oil and gas companies. This sector represents nearly 3% of the loan portfolio of the National Bank.
Excluding certain items, earnings per share were $ 0.60, which corresponds to the average forecast of analysts surveyed by Bloomberg.
The CEO of the National Louis Vachon, said in a statement that the bank continued to enjoy "good growth in loans and deposits from individuals and companies and has maintained tight control of operating expenses." Despite the important provision that the Bank had to take the credit quality of loans for the whole portfolio, excluding loans to enterprises and production of oil and gas sector service, continues in line with expectations, added the CEO.
"In addition to this provision, the results of the National Bank have been relatively strong, investors' attention should not only be on the energy sector in the future," wrote analyst John Aiken, in a statement sent by email.
The Bank also announced a 2% increase in its quarterly dividend. This will increase to $ 0.55 per share.
At the mid-session, the title of the National was down 1.2%, the worst drop in the Canadian banking sector.
No comments: