Bank of Nova Scotia Shares Fall 4.2% on Higher Provisions, Lower Profit in 4Q
By Adriano Marchese
Shares of Bank of Nova Scotia were lower Tuesday morning after the company said higher provision for credit losses in its fourth quarter drove profits lower.
At 10:02 a.m. ET, Canada's 'Big 6' bank stocks were all trading lower, but Bank of Nova Scotia shares were down the most, falling 4.2% to 57.74 Canadian dollars ($42.40).
The Canadian financial institution reported provision for credit losses, an estimate of how much the bank could lose due to bad debts, increased to C$1.26 billion in the three months ended Oct. 31, from C$529 million a year earlier.
The bank says unfavorable macroeconomic outlook and uncertainty around the effects of higher interest rates are behind the increase. But Bank of Nova Scotia also booked a number of other one-off charges that weighed on the quarter's profit.
Net income came in at C$1.39 billion, or C$1.02 a share, down from C$2.09 billion, or C$1.63 a share, in the comparable quarter a year ago.
On an adjusted basis, which strips out those one-off items and costs, earnings missed FactSet-polled analyst expectations, falling to C$1.26 a share, more than the anticipated decline to C$1.65 a share.
Total revenue rose to C$8.31 billion from C$7.63 billion, better than the C$8.21 billion analysts were looking for.
Write to Adriano Marchese at adriano.marchese@wsj.com
(END) Dow Jones Newswires
November 28, 2023 10:23 ET (15:23 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.-
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