Higher Rates Not Helping Scotiabank in Fiscal Fourth-Quarter Earnings

Narrow-moat-rated Bank of Nova Scotia reported mixed fiscal fourth-quarter results. Revenue came in at CAD 7.63 billion versus our expectation for CAD 7.96 billion. Expenses were CAD 4.53 billion versus our expectation for CAD 4.28 billion. Backing out losses on divestitures, revenue would have been roughly in line. On this adjusted basis, pretax preprovision profits, or PTPP, were roughly 6% below our expectations for the quarter. Earnings per share of CAD 1.63 were slightly ahead of our forecast for CAD 1.59, but this was solely due to lower provisioning for credit losses, and we would place more emphasis on the core PTPP miss.