The Globe and Mail reports in its Wednesday edition that encouraging earnings from Bank of Nova Scotia capped off a choppy year in Canadian banking. The Globe's Tim Kiladze writes that Scotiabank posted a $2-billion fourth-quarter profit on Tuesday, worth $1.58 a share -- an 8-per-cent jump from the same period in 2015. Analysts expected earnings of $1.51 a share.
The lender is the first of the Big Six to report for the quarter and show that Scotiabank can grow despite investor concerns about its international operations and energy exposures.
Investors are impressed. Scotiabank shares have soared 43 per cent to $73.70 from the year's low in January, including a $1.18 pop Tuesday.
Investors are much less worried about energy exposures. Scotiabank and its peers may also benefit from market expectations that the U.S. Federal Reserve will hike interest rates in December, and investors also hope that Donald Trump's infrastructure spending plans could stimulate the economy and create inflation, which has prompted a bond sell-off. Despite a massive restructuring over the past two years, the bank's full-year profit rose only 2 per cent from 2015. Full-year expenses grew by 11 per cent, outpacing revenues.
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