Scotiabank reported a slight dip in second-quarter profits on Tuesday, as it set aside more money to cover potential loan defaults amid ongoing economic uncertainty. The bank posted a net income of $2.03 billion for the quarter ending April 30, down from $2.09 billion during the same period last year.
Earnings came in at $1.48 per diluted share, compared with $1.57 a year earlier. On an adjusted basis, the bank earned $1.52 per share, falling short of analysts’ expectations of $1.56, according to LSEG Data & Analytics.
Despite the earnings dip, Scotiabank raised its quarterly dividend to $1.10 per share, up from $1.06 — signaling confidence in its long-term outlook.
Total revenue rose to $9.08 billion, up from $8.35 billion a year ago. However, provisions for credit losses jumped to $1.40 billion, compared with $1.01 billion in the same quarter last year, reflecting growing caution amid a cloudy economic environment.
CEO Scott Thomson said the bank is staying focused on its strategic priorities while bracing for potential turbulence. “We increased our performing allowances to reflect the impact of an uncertain macroeconomic outlook,” he said, adding that the bank’s strong balance sheet puts it in a good position to support clients and capture new opportunities.
Breaking down performance by division, Canadian banking earnings slid to $613 million from $893 million, driven by higher provisions for credit losses and rising non-interest expenses. Meanwhile, international banking posted a stronger quarter, with net income climbing to $676 million from $639 million.
Global wealth management earnings rose to $399 million from $341 million, and the global banking and markets division also grew, posting $413 million in net income versus $375 million last year.
Despite the mixed results, Scotiabank’s steady revenue growth and expanded dividend suggest the bank remains resilient as it navigates a challenging financial landscape.