Narrow loan margins mar Canada bank profit gains
lower than we anticipated as
greater-than-expected loan growth was offset by greater-than-anticipated margin pressure," RBC Capital Markets analyst Andre-Philippe Hardy said in a note.
Adjusted cash earnings of 56 Canadian cents a share fell just short of analysts' expectations of a profit of 58 Canadian cents a share.
Canadian Western raised its dividend by 6 percent to 17 Canadian cents a share, which analysts had expected. Its shares fell C$1.00 to C$28.00.
BMO U.S. CREDIT BOOST
BMO's adjusted provisions for credit losses were C$113 million, down from C$281 million a year earlier, helped by the unexpected repayment of impaired loans acquired when BMO bought M&I.
BMO paid $4.1 billion for M&I, which it combined with its Chicago-based Harris Bank. Excluding the impact of the impaired loans, profit for the U.S. bank fell 16 percent to C$130 million, due to a reduction in certain loan portfolios and regulatory changes. Also driving BMO profit was a doubling of wholesale banking
income, due largely to a jump in equity and interest rate trading revenues from a relatively weak quarter a year ago.Stronger capital markets income was also key to Royal Bank of Canada's (RBC) better-than-expected 22 percent rise in quarterly income reported last week. oronto-Dominion Bank and Canadian Imperial Bank of Commerce will report on Thursday, while Bank of Nova Scotia will release results on Friday.
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