MONTREAL — National Bank of Canada's profits slipped from a year ago on higher provisions for credit loss, but third-quarter results were buffered by resilient trading revenue and higher net interest income.
The Montreal-based bank said Wednesday it earned net income of $826 million or $2.35 per diluted share for the quarter ended July 31, down from $839 million or $2.36 per diluted share a year ago.
Provisions for credit losses amounted to $57 million for the quarter compared with a reversal of provisions for credit losses of $43 million a year earlier.
Chief executive Laurent Ferreira said on an earnings call that the boosted provisions come as it expects a slowdown in economic growth to persist, but not necessarily a recession.
"Although the probability of a recession has increased over the past few weeks, it is not our base case. Our economics team is currently calling for a soft landing of the Canadian economy."
He noted that the bank's concentration in Quebec could also help buffer the bank from economic challenges given better relative housing affordability, consumer savings and debt levels in the province.
The bank reported that its personal and commercial banking business earned $335 million, up from $303 million in the same quarter last year as mortgage loans grew by eight per cent year over year.
Revenue totalled $2.4 billion, up from $2.3 billion in the same quarter last year.
On an adjusted basis, National Bank said it earned $2.35 per diluted share compared with an adjusted profit of $2.36 per diluted share a year ago.
Analysts on average had expected an adjusted profit of $2.34 per share, according to financial markets data firm Refinitiv.
The bank's wealth management business earned $181 million, up from $164 million a year ago, while its financial markets operations earned $280 million, up from $249 million a year earlier.
This report by The Canadian Press was first published Aug. 24, 2022.
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