National Bank raises dividend 23% but misses profit expectations

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National Bank of Canada increased its quarterly dividend by 23 percent as it reported a fourth-quarter profit of $776 million, up from $492 million a year ago.

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The Montreal-based bank said Wednesday it would now pay a dividend of 87 cents per share, up from 71 cents per share. National Bank also said it plans to buy back seven million of its shares.

The announcement follows a decision by the federal banking regulator last month to lift restrictions imposed at the start of the pandemic that prevented federally regulated banks and insurers from raising dividends, buying back shares and increasing executive compensation.

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National Bank said its profit was $2.19 per diluted share, up from $1.36 per diluted share in the same quarter last year. Total revenue stood at $2.2 billion, up from $2 billion a year earlier.

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“The Bank’s continued performance reinforces our commitment to continue deploying appropriate strategies in terms of business mix, capital allocation and risk management,” National Bank Chief Executive Laurent Ferreira said in a statement.

“We enter the new year on a strong footing, well positioned to generate solid growth across our business segments and deliver superior returns to our shareholders.”

Excluding specified items, National Bank said it earned $2.21 per diluted share, up from $1.69 per diluted share in the same quarter last year.

Analysts had expected an average adjusted profit of $2.24 per diluted share, according to financial market data firm Refinitiv.

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During the quarter, National Bank reversed $41 million in its provisions for credit losses, compared to $110 million set aside in the same quarter last year.

National Bank said its personal and commercial banking business earned $353 million in its latest quarter, up from $249 million a year ago, while its wealth management business earned $165, up from $134 million in the same quarter last year. Earn a million

The bank’s financial markets arm saw its profit steady at $208 million compared to a year ago, while its US specialty finance and international business earned $129 million from $106 million.

For its full fiscal year, National Bank earned $3.2 billion, or $8.96 per diluted share, on $8.9 billion in revenue, compared to a profit of $2.1 billion, or $5.70 per diluted share, on revenue of $7.9 billion in the same period a year ago.

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