The financial
information reported in this document is based on the unaudited
interim condensed consolidated financial statements for the quarter
and six-month period ended April 30, 2024 and is prepared in
accordance with International Financial Reporting Standards (IFRS)
as issued by the International Accounting Standards Board (IASB),
unless otherwise indicated. IFRS represent Canadian generally
accepted accounting principles (GAAP). All amounts are presented in
Canadian dollars.
|
MONTREAL, May 29, 2024
/CNW/ - For the second quarter of 2024, National Bank is reporting
net income of $906 million, up 9%
from $832 million in the second
quarter of 2023. Second-quarter diluted earnings per share stood at
$2.54 compared to $2.34 in the second quarter of 2023. These
increases were driven by total revenue growth in all of the
business segments, partly offset by higher non-interest expenses
and higher provisions for credit losses.
![National Bank of Canada Logo (CNW Group/National Bank of Canada) National Bank of Canada Logo (CNW Group/National Bank of Canada)](https://mma.prnewswire.com/media/2422913/National_Bank_of_Canada_National_Bank_reports_its_results_for_th.jpg)
For the six-month period ended April 30,
2024, the Bank's net income totalled $1,828 million, up 7% from $1,708 million in the same period of
2023. First-half diluted earnings per share stood at
$5.13 compared to $4.81 in the first half of 2023. These
increases were driven by good performance, owing to revenue growth,
in all of the business segments, partly offset by higher
non-interest expenses, higher provisions for credit losses, and the
impact of the Canadian government's 2022 tax measures recorded in
the first half of 2023. Excluding the impact of these measures,
first-half adjusted net income(1) totalled $1,828 million, up 6% from $1,732 million in first-half 2023, while
first-half adjusted diluted earnings per share(1) stood
at $5.13, up 5% from $4.88 in first-half 2023.
"National Bank generated strong financial results for the second
quarter of 2024, reflecting the disciplined execution of our
strategy across business segments and the diversified earnings
power of the Bank," said Laurent
Ferreira, President and Chief Executive Officer of National
Bank of Canada. "In what remains
an uncertain macroeconomic environment, we are committed to
maintaining our prudent approach to capital, credit, and costs and
to generating long-term value for our shareholders."
Highlights
(millions of Canadian
dollars)
|
|
|
Quarter ended
April 30
|
|
|
Six months ended
April 30
|
|
|
|
|
|
2024
|
|
|
|
2023(2)
|
|
|
% Change
|
|
|
2024
|
|
|
|
2023(2)
|
|
|
% Change
|
|
Net income
|
|
|
906
|
|
|
|
832
|
|
|
9
|
|
|
1,828
|
|
|
|
1,708
|
|
|
7
|
|
Diluted earnings per
share (dollars)
|
|
$
|
2.54
|
|
|
$
|
2.34
|
|
|
9
|
|
$
|
5.13
|
|
|
$
|
4.81
|
|
|
7
|
|
Income before
provisions for credit losses and income taxes
|
|
|
1,278
|
|
|
|
1,084
|
|
|
18
|
|
|
2,539
|
|
|
|
2,256
|
|
|
13
|
|
Return on common
shareholders' equity(3)
|
|
|
16.9
|
%
|
|
|
17.2
|
%
|
|
|
|
|
17.0
|
%
|
|
|
17.5
|
%
|
|
|
|
Dividend payout
ratio(3)
|
|
|
43.2
|
%
|
|
|
40.5
|
%
|
|
|
|
|
43.2
|
%
|
|
|
40.5
|
%
|
|
|
|
Operating
results – Adjusted(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income –
Adjusted
|
|
|
906
|
|
|
|
832
|
|
|
9
|
|
|
1,828
|
|
|
|
1,732
|
|
|
6
|
|
Diluted earnings per
share – Adjusted (dollars)
|
|
$
|
2.54
|
|
|
$
|
2.34
|
|
|
9
|
|
$
|
5.13
|
|
|
$
|
4.88
|
|
|
5
|
|
Income before
provisions for credit losses and income taxes – Adjusted
|
|
|
1,365
|
|
|
|
1,216
|
|
|
12
|
|
|
2,736
|
|
|
|
2,518
|
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at
April 30,
2024
|
|
|
As at
October 31,
2023
|
|
|
|
|
CET1 capital ratio
under Basel III(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
13.2
|
%
|
|
|
13.5
|
%
|
|
|
|
Leverage ratio under
Basel III(4)
|
|
|
|
|
|
|
|
|
|
|
|
|
4.4
|
%
|
|
|
4.4
|
%
|
|
|
|
(1)
|
See the Financial
Reporting Method section on pages 3 to 6 for additional information
on non-GAAP financial measures.
|
(2)
|
Certain amounts have
been adjusted to reflect accounting policy changes arising from the
adoption of IFRS 17. For additional information, see Note 2 to the
unaudited interim condensed consolidated financial statements in
the Report to Shareholders –
Second Quarter 2024, which is available on the
Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
(3)
|
For details on the
composition of these measures, see the Glossary section on pages 47
to 50 in the Report to Shareholders –
Second Quarter 2024, which is available on the
Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
(4)
|
For additional
information on capital management measures, see the Financial
Reporting Method section on pages 4 to 10 in the Report to
Shareholders – Second Quarter 2024, which
is available on the Bank's website at nbc.ca or the SEDAR+ website
at sedarplus.ca.
|
Personal and Commercial
- Net income totalled $311 million
in the second quarter of 2024 versus $320
million in the second quarter of 2023, a 3% decrease that
was mainly due to higher provisions for credit losses.
- Income before provisions for credit losses and income taxes
totalled $519 million in the second
quarter of 2024, up 9% from $478
million in the second quarter of 2023.
- At $1,131 million, second-quarter
total revenues rose $64 million or 6%
year over year, mainly due to an increase in net interest income
(driven by growth in loan and deposit volumes) and to a higher net
interest margin.
- Compared to a year ago, personal lending grew 3% and commercial
lending grew 12%.
- The net interest margin(1) stood at 2.36% in the
second quarter of 2024, up from 2.34% in the second quarter of
2023.
- Second-quarter non-interest expenses stood at $612 million, up 4% from the second quarter of
2023.
- Second-quarter provisions for credit losses rose $52 million year over year, mainly due to higher
provisions for credit losses on impaired loans.
- At 54.1%, the second-quarter efficiency ratio(1)
improved from 55.2% in the second quarter of 2023.
Wealth Management
- Net income totalled $205 million
in the second quarter of 2024, a 15% increase from $178 million in the second quarter of 2023.
- Second-quarter total revenues amounted to $683 million compared to $617 million in second-quarter 2023, a
$66 million or 11% increase driven
mostly by growth in fee-based revenues.
- Second-quarter non-interest expenses stood at $400 million versus $372
million in second-quarter 2023, an 8% increase associated
with the revenue growth.
- At 58.6%, the second-quarter efficiency ratio(1)
improved from 60.3% in the second quarter of 2023.
Financial Markets
- Net income totalled $322 million
in the second quarter of 2024, up 20% from $268 million in the second quarter of 2023.
- Second-quarter total revenues on a taxable equivalent basis
amounted to $766 million, up
$94 million or 14% given increases in
global markets revenues and in revenues from corporate and
investment banking services.
- Second-quarter non-interest expenses stood at $312 million compared to $283 million in second-quarter 2023, an increase
that was partly due to compensation and employee benefits as well
as to the segment's technological investments.
- Second-quarter provisions for credit losses stood at
$11 million, down $8 million year over year.
- At 40.7%, the efficiency ratio(1) on a taxable
equivalent basis improved from 42.1% in the second quarter of
2023.
U.S. Specialty Finance and International
- Net income totalled $163 million
in the second quarter of 2024, up 27% from $128 million in the second quarter of 2023.
- Second-quarter total revenues amounted to $350 million, a 23% year-over-year increase
driven by revenue growth at both the Credigy and ABA Bank
subsidiaries.
- Second-quarter non-interest expenses stood at $108 million, a 10% year-over-year increase
attributable mainly to business growth at ABA Bank.
- Second-quarter provisions for credit losses were up
$11 million year over year, with the
increase being attributable to both Credigy and ABA Bank.
- At 30.9%, the efficiency ratio(1) improved from
34.4% in the second quarter of 2023.
Other
- Net loss stood at $95 million in
the second quarter of 2024 versus a $62
million net loss in the second quarter of 2023 due to a
lower contribution from Treasury activities and to higher
non-interest expenses.
Capital Management
- As at April 30, 2024, the Common
Equity Tier 1 (CET1) capital ratio under Basel III(2)
stood at 13.2%, down from 13.5% as at October 31, 2023, notably due to a negative
impact of implementing the revised market risk and credit valuation
adjustment (CVA) risk frameworks.
- As at April 30, 2024, the Basel
III(2) leverage ratio was 4.4%, stable compared to
October 31, 2023.
Dividends
- On May 28, 2024, the Board of
Directors declared regular dividends on the various series of first
preferred shares and a dividend of $1.10 per common share, up 4 cents or 4%, payable on August 1, 2024 to shareholders of record on
June 24, 2024.
(1)
|
For details on the
composition of these measures, see the Glossary section on pages 47
to 50 in the Report to Shareholders – Second
Quarter 2024, which is available on the Bank's website at
nbc.ca or the SEDAR+ website at sedarplus.ca.
|
(2)
|
For additional
information on capital management measures, see the Financial
Reporting Method section on pages 4 to 10 in the Report to
Shareholders – Second Quarter 2024, which is
available on the Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
Financial Reporting Method
The Bank's consolidated financial statements are prepared in
accordance with IFRS, as issued by the IASB. The financial
statements also comply with section 308(4) of the Bank
Act (Canada), which states
that, except as otherwise specified by the Office of the
Superintendent of Financial Institutions (Canada) (OSFI), the consolidated financial
statements are to be prepared in accordance with IFRS, which
represent Canadian GAAP. None of the OSFI accounting
requirements are exceptions to IFRS.
The presentation of segment disclosures is consistent with the
presentation adopted by the Bank for the fiscal year beginning
November 1, 2023. This
presentation reflects the retrospective application of accounting
policy changes arising from the adoption of IFRS 17– Insurance
Contracts (IFRS 17). For additional information, see Note 2 to the
consolidated financial statements. The figures for the 2023
quarters have been adjusted to reflect these accounting policy
changes.
Non-GAAP and Other Financial Measures
The Bank uses a number of financial measures when assessing its
results and measuring overall performance. Some of these
financial measures are not calculated in accordance with GAAP.
Regulation 52-112 Respecting Non-GAAP and Other Financial
Measures Disclosure (Regulation 52-112) prescribes disclosure
requirements that apply to the following measures used by the
Bank:
- non-GAAP financial measures;
- non-GAAP ratios;
- supplementary financial measures;
- capital management measures.
Non-GAAP Financial Measures
The Bank uses non-GAAP
financial measures that do not have standardized meanings under
GAAP and that therefore may not be comparable to similar measures
used by other companies. Presenting non-GAAP financial
measures helps readers to better understand how management analyzes
results, shows the impacts of specified items on the results of the
reported periods, and allows readers to better assess results
without the specified items if they consider such items not to be
reflective of the underlying performance of the Bank's operations.
In addition, the Bank uses the taxable equivalent basis to
calculate net interest income, non-interest income, and income
taxes. This calculation method consists of grossing up certain
revenues taxed at lower rates (notably dividends) by the income tax
to a level that would make it comparable to revenues from taxable
sources in Canada. An equivalent
amount is added to income taxes. This adjustment is necessary in
order to perform a uniform comparison of the return on different
assets, regardless of their tax treatment. However, in light of the
proposed legislation with respect to Canadian dividends, the Bank
did not either recognize an income tax deduction or use the taxable
equivalent basis method to adjust revenues related to affected
dividends received after January 1,
2024 (for additional information see the Income Taxes –
Proposed Legislation section in the Report to shareholders for the
second quarter of 2024, which is available on the Bank's website at
nbc.ca or the SEDAR+ website at sedarplus.ca).
The key non-GAAP financial measures used by the Bank to analyze
its results are described below, and a quantitative reconciliation
of these measures is presented in the tables in the Reconciliation
of Non-GAAP Financial Measures section on pages 4 to 6. Note that
no specified items have been excluded from results for the quarter
and six-month period ended April 30, 2024. In the first
six-month period of 2023, a $24 million tax expense related to
the Canadian government's 2022 tax measures had been excluded from
results given the one-time nature of the item. This amount had
included a $32 million tax expense with respect to the Canada
Recovery Dividend, i.e., a one-time, 15% tax on the fiscal 2021 and
2020 average taxable income above $1
billion as well as an $8
million tax recovery related to the 1.5% increase in the
statutory tax rate, which included the impact related to current
and deferred taxes for fiscal 2022.
For additional information on non-GAAP financial measures,
non-GAAP ratios, supplementary financial measures, and capital
management measures, see the Financial Reporting Method section and
the Glossary section, on pages 4 to 10 and 47 to 50, respectively,
in the Report to shareholders for the second quarter of 2024, which
is available on the Bank's website at nbc.ca or the SEDAR+ website
at sedarplus.ca.
Reconciliation of Non-GAAP Financial Measures
Presentation of Results – Adjusted
(millions of Canadian
dollars)
|
|
|
|
|
|
|
Quarter ended April
30
|
|
|
|
|
|
|
|
|
|
|
|
|
2024
|
|
2023(1)
|
|
|
|
Personal
and
Commercial
|
|
Wealth
Management
|
|
Financial
Markets
|
|
USSF&I
|
|
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
Total
|
|
Operating
results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
870
|
|
203
|
|
(659)
|
|
318
|
|
(97)
|
|
635
|
|
882
|
|
Non-interest
income
|
261
|
|
480
|
|
1,425
|
|
32
|
|
(83)
|
|
2,115
|
|
1,564
|
|
Total
revenues
|
1,131
|
|
683
|
|
766
|
|
350
|
|
(180)
|
|
2,750
|
|
2,446
|
|
Non-interest
expenses
|
612
|
|
400
|
|
312
|
|
108
|
|
40
|
|
1,472
|
|
1,362
|
|
Income before
provisions for credit losses and income taxes
|
519
|
|
283
|
|
454
|
|
242
|
|
(220)
|
|
1,278
|
|
1,084
|
|
Provisions for credit
losses
|
89
|
|
−
|
|
11
|
|
37
|
|
1
|
|
138
|
|
85
|
|
Income before income
taxes (recovery)
|
430
|
|
283
|
|
443
|
|
205
|
|
(221)
|
|
1,140
|
|
999
|
|
Income taxes
(recovery)
|
119
|
|
78
|
|
121
|
|
42
|
|
(126)
|
|
234
|
|
167
|
|
Net
income
|
311
|
|
205
|
|
322
|
|
163
|
|
(95)
|
|
906
|
|
832
|
|
Non-controlling
interests
|
−
|
|
−
|
|
−
|
|
−
|
|
(1)
|
|
(1)
|
|
(1)
|
|
Net income attributable
to the Bank's shareholders and
holders of other
equity instruments
|
311
|
|
205
|
|
322
|
|
163
|
|
(94)
|
|
907
|
|
833
|
|
Dividends on preferred
shares and distributions on limited recourse
capital
notes
|
|
|
|
|
|
|
|
|
|
|
37
|
|
35
|
|
Net income attributable
to common shareholders
|
|
|
|
|
|
|
|
|
|
|
870
|
|
798
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items that have an
impact on results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
equivalent(2)
|
−
|
|
−
|
|
−
|
|
−
|
|
14
|
|
14
|
|
76
|
|
Impact on net interest
income
|
−
|
|
−
|
|
−
|
|
−
|
|
14
|
|
14
|
|
76
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
equivalent(2)
|
−
|
|
−
|
|
−
|
|
−
|
|
73
|
|
73
|
|
56
|
|
Impact on non-interest
income
|
−
|
|
−
|
|
−
|
|
−
|
|
73
|
|
73
|
|
56
|
|
Income
taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
equivalent(2)
|
−
|
|
−
|
|
−
|
|
−
|
|
87
|
|
87
|
|
132
|
|
Impact on income
taxes
|
−
|
|
−
|
|
−
|
|
−
|
|
87
|
|
87
|
|
132
|
|
Impact on net
income
|
−
|
|
−
|
|
−
|
|
−
|
|
−
|
|
−
|
|
−
|
|
Operating results –
Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income –
Adjusted
|
870
|
|
203
|
|
(659)
|
|
318
|
|
(83)
|
|
649
|
|
958
|
|
Non-interest income –
Adjusted
|
261
|
|
480
|
|
1,425
|
|
32
|
|
(10)
|
|
2,188
|
|
1,620
|
|
Total revenues –
Adjusted
|
1,131
|
|
683
|
|
766
|
|
350
|
|
(93)
|
|
2,837
|
|
2,578
|
|
Non-interest expenses –
Adjusted
|
612
|
|
400
|
|
312
|
|
108
|
|
40
|
|
1,472
|
|
1,362
|
|
Income before
provisions for credit losses and income taxes – Adjusted
|
519
|
|
283
|
|
454
|
|
242
|
|
(133)
|
|
1,365
|
|
1,216
|
|
Provisions for credit
losses
|
89
|
|
−
|
|
11
|
|
37
|
|
1
|
|
138
|
|
85
|
|
Income before income
taxes (recovery) – Adjusted
|
430
|
|
283
|
|
443
|
|
205
|
|
(134)
|
|
1,227
|
|
1,131
|
|
Income taxes (recovery)
– Adjusted
|
119
|
|
78
|
|
121
|
|
42
|
|
(39)
|
|
321
|
|
299
|
|
Net income –
Adjusted
|
311
|
|
205
|
|
322
|
|
163
|
|
(95)
|
|
906
|
|
832
|
|
Non-controlling
interests
|
−
|
|
−
|
|
−
|
|
−
|
|
(1)
|
|
(1)
|
|
(1)
|
|
Net income attributable
to the Bank's shareholders and
holders of other
equity instruments – Adjusted
|
311
|
|
205
|
|
322
|
|
163
|
|
(94)
|
|
907
|
|
833
|
|
Dividends on preferred
shares and distributions on limited recourse
capital
notes
|
|
|
|
|
|
|
|
|
|
|
37
|
|
35
|
|
Net income attributable
to common shareholders – Adjusted
|
|
|
|
|
|
|
|
|
|
|
870
|
|
798
|
|
(1)
|
Certain amounts have
been adjusted to reflect accounting policy changes arising from the
adoption of IFRS 17. For additional information, see Note 2 to the
unaudited interim condensed consolidated financial statements in
the Report to Shareholders – Second Quarter
2024, which is available on the Bank's website at nbc.ca or the
SEDAR+ website at sedarplus.ca.
|
(2)
|
In light of the
proposed legislation with respect to Canadian dividends, the Bank
did not recognize an income tax deduction or use the taxable
equivalent basis method to adjust revenues related to affected
dividends received after January 1, 2024 (for additional
information see the Income Taxes – Proposed Legislation section in
the Report to Shareholders – Second Quarter
2024, which is available on the Bank's website at nbc.ca or the
SEDAR+ website at sedarplus.ca).
|
(millions of Canadian
dollars)
|
|
|
|
|
|
|
Six months ended April
30
|
|
|
|
|
|
|
|
|
|
|
|
|
2024
|
|
2023(1)
|
|
|
|
Personal
and
Commercial
|
|
Wealth
Management
|
|
Financial
Markets
|
|
USSF&I
|
|
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
Total
|
|
Operating
results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
1,740
|
|
401
|
|
(1,177)
|
|
619
|
|
(197)
|
|
1,386
|
|
1,981
|
|
Non-interest
income
|
545
|
|
942
|
|
2,698
|
|
57
|
|
(168)
|
|
4,074
|
|
3,027
|
|
Total
revenues
|
2,285
|
|
1,343
|
|
1,521
|
|
676
|
|
(365)
|
|
5,460
|
|
5,008
|
|
Non-interest
expenses
|
1,227
|
|
790
|
|
625
|
|
208
|
|
71
|
|
2,921
|
|
2,752
|
|
Income before
provisions for credit losses and income taxes
|
1,058
|
|
553
|
|
896
|
|
468
|
|
(436)
|
|
2,539
|
|
2,256
|
|
Provisions for credit
losses
|
160
|
|
−
|
|
28
|
|
73
|
|
(3)
|
|
258
|
|
171
|
|
Income before income
taxes (recovery)
|
898
|
|
553
|
|
868
|
|
395
|
|
(433)
|
|
2,281
|
|
2,085
|
|
Income taxes
(recovery)
|
248
|
|
152
|
|
238
|
|
82
|
|
(267)
|
|
453
|
|
377
|
|
Net
income
|
650
|
|
401
|
|
630
|
|
313
|
|
(166)
|
|
1,828
|
|
1,708
|
|
Non-controlling
interests
|
−
|
|
−
|
|
−
|
|
−
|
|
(1)
|
|
(1)
|
|
(1)
|
|
Net income attributable
to the Bank's shareholders and
holders of other
equity instruments
|
650
|
|
401
|
|
630
|
|
313
|
|
(165)
|
|
1,829
|
|
1,709
|
|
Dividends on preferred
shares and distributions on limited recourse
capital
notes
|
|
|
|
|
|
|
|
|
|
|
74
|
|
70
|
|
Net income attributable
to common shareholders
|
|
|
|
|
|
|
|
|
|
|
1,755
|
|
1,639
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items that have an
impact on results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
equivalent(2)
|
−
|
|
−
|
|
−
|
|
−
|
|
51
|
|
51
|
|
154
|
|
Impact on net interest
income
|
−
|
|
−
|
|
−
|
|
−
|
|
51
|
|
51
|
|
154
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
equivalent(2)
|
−
|
|
−
|
|
−
|
|
−
|
|
146
|
|
146
|
|
108
|
|
Impact on non-interest
income
|
−
|
|
−
|
|
−
|
|
−
|
|
146
|
|
146
|
|
108
|
|
Income
taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxable
equivalent(2)
|
−
|
|
−
|
|
−
|
|
−
|
|
197
|
|
197
|
|
262
|
|
|
Income taxes related to
the Canadian government's 2022 tax
measures(3)
|
−
|
|
−
|
|
−
|
|
−
|
|
−
|
|
−
|
|
(24)
|
|
Impact on income
taxes
|
−
|
|
−
|
|
−
|
|
−
|
|
197
|
|
197
|
|
238
|
|
Impact on net
income
|
−
|
|
−
|
|
−
|
|
−
|
|
−
|
|
−
|
|
(24)
|
|
Operating
results – Adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income –
Adjusted
|
1,740
|
|
401
|
|
(1,177)
|
|
619
|
|
(146)
|
|
1,437
|
|
2,135
|
|
Non-interest income –
Adjusted
|
545
|
|
942
|
|
2,698
|
|
57
|
|
(22)
|
|
4,220
|
|
3,135
|
|
Total revenues –
Adjusted
|
2,285
|
|
1,343
|
|
1,521
|
|
676
|
|
(168)
|
|
5,657
|
|
5,270
|
|
Non-interest expenses –
Adjusted
|
1,227
|
|
790
|
|
625
|
|
208
|
|
71
|
|
2,921
|
|
2,752
|
|
Income before
provisions for credit losses and income taxes – Adjusted
|
1,058
|
|
553
|
|
896
|
|
468
|
|
(239)
|
|
2,736
|
|
2,518
|
|
Provisions for credit
losses
|
160
|
|
−
|
|
28
|
|
73
|
|
(3)
|
|
258
|
|
171
|
|
Income before income
taxes (recovery) – Adjusted
|
898
|
|
553
|
|
868
|
|
395
|
|
(236)
|
|
2,478
|
|
2,347
|
|
Income taxes (recovery)
– Adjusted
|
248
|
|
152
|
|
238
|
|
82
|
|
(70)
|
|
650
|
|
615
|
|
Net income –
Adjusted
|
650
|
|
401
|
|
630
|
|
313
|
|
(166)
|
|
1,828
|
|
1,732
|
|
Non-controlling
interests
|
−
|
|
−
|
|
−
|
|
−
|
|
(1)
|
|
(1)
|
|
(1)
|
|
Net income attributable
to the Bank's shareholders and
holders of other
equity instruments – Adjusted
|
650
|
|
401
|
|
630
|
|
313
|
|
(165)
|
|
1,829
|
|
1,733
|
|
Dividends on preferred
shares and distributions on limited recourse
capital
notes
|
|
|
|
|
|
|
|
|
|
|
74
|
|
70
|
|
Net income attributable
to common shareholders – Adjusted
|
|
|
|
|
|
|
|
|
|
|
1,755
|
|
1,663
|
|
(1)
|
Certain amounts have
been adjusted to reflect accounting policy changes arising from the
adoption of IFRS 17. For additional information, see Note 2 to the
unaudited interim condensed consolidated financial statements in
the Report to Shareholders –
Second Quarter 2024, which is available on the
Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
|
(2)
|
In light of the
proposed legislation with respect to Canadian dividends, the Bank
did not recognize an income tax deduction or use the taxable
equivalent basis method to adjust revenues related to affected
dividends received after January 1, 2024 (for additional
information, see the Income Taxes – Proposed Legislation section in
the Report to Shareholders –
Second Quarter 2024, which is available on the
Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca).
|
(3)
|
During the six-month
period ended April 30, 2023, the Bank recorded, in the Other
heading of segment results, a $32 million tax expense with respect
to the Canada Recovery Dividend, i.e., a one-time, 15% tax on the
fiscal 2021 and 2020 average taxable income above $1 billion as
well as an $8 million tax recovery related to the 1.5% increase in
the statutory tax rate, which included the impact related to
current and deferred taxes for fiscal 2022. For additional
information on these tax measures, see the Income Taxes section in
the Report to Shareholders –
Second Quarter 2024, which is available on the
Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
Presentation of Basic and Diluted Earnings Per Share –
Adjusted
(Canadian
dollars)
|
|
Quarter ended
April 30
|
|
Six months ended
April 30
|
|
|
|
2024
|
|
|
|
2023(1)
|
|
|
2024
|
|
|
2023(1)
|
|
Basic earnings per
share
|
|
$
|
2.56
|
|
|
$
|
2.37
|
|
$
|
5.18
|
|
$
|
4.86
|
|
Income taxes related to
the Canadian government's 2022 tax
measures(2)
|
|
|
−
|
|
|
|
−
|
|
|
−
|
|
|
0.07
|
|
Basic earnings per
share – Adjusted
|
|
$
|
2.56
|
|
|
$
|
2.37
|
|
$
|
5.18
|
|
$
|
4.93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
$
|
2.54
|
|
|
$
|
2.34
|
|
$
|
5.13
|
|
$
|
4.81
|
|
Income taxes related to
the Canadian government's 2022 tax
measures(2)
|
|
|
−
|
|
|
|
−
|
|
|
−
|
|
|
0.07
|
|
Diluted earnings per
share – Adjusted
|
|
$
|
2.54
|
|
|
$
|
2.34
|
|
$
|
5.13
|
|
$
|
4.88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Certain amounts have
been adjusted to reflect accounting policy changes arising from the
adoption of IFRS 17. For additional information, see Note 2 to the
unaudited interim condensed consolidated financial statements in
the Report to Shareholders – First Quarter
2024, which is available on the Bank's website at nbc.ca or the
SEDAR+ website at sedarplus.ca.
|
(2)
|
During the six-month
period ended April 30, 2023, the Bank recorded, in the Other
heading segment results, a $32 million tax expense with respect to
the Canada Recovery Dividend, i.e., a one-time, 15% tax on the
fiscal 2021 and 2020 average taxable income above $1 billion as
well as an $8 million tax recovery related to the 1.5% increase in
the statutory tax rate, which included the impact related to
current and deferred taxes for fiscal 2022. For additional
information on these tax measures, see the Income Taxes section in
the Report to Shareholders – Second Quarter
2024, which is available on the Bank's website at nbc.ca or the
SEDAR+ website at sedarplus.ca.
|
Highlights
(millions of Canadian
dollars, except per share amounts)
|
|
Quarter ended
April 30
|
|
|
Six months ended
April 30
|
|
|
|
|
2024
|
|
|
|
2023(1)
|
|
|
% Change
|
|
|
2024
|
|
|
|
2023(1)
|
|
% Change
|
|
Operating
results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
|
|
2,750
|
|
|
|
2,446
|
|
|
12
|
|
|
5,460
|
|
|
|
5,008
|
|
9
|
|
Income
before provisions for credit
losses and
income
taxes
|
|
|
1,278
|
|
|
|
1,084
|
|
|
18
|
|
|
2,539
|
|
|
|
2,256
|
|
13
|
|
Net income
|
|
|
906
|
|
|
|
832
|
|
|
9
|
|
|
1,828
|
|
|
|
1,708
|
|
7
|
|
Return on common
shareholders' equity(2)
|
|
|
16.9
|
%
|
|
|
17.2
|
%
|
|
|
|
|
17.0
|
%
|
|
|
17.5
|
%
|
|
|
Operating
leverage(2)
|
|
|
4.3
|
%
|
|
|
(4.5)
|
%
|
|
|
|
|
2.9
|
%
|
|
|
(4.6)
|
%
|
|
|
Efficiency
ratio(2)
|
|
|
53.5
|
%
|
|
|
55.7
|
%
|
|
|
|
|
53.5
|
%
|
|
|
55.0
|
%
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
2.56
|
|
|
$
|
2.37
|
|
|
8
|
|
$
|
5.18
|
|
|
$
|
4.86
|
|
7
|
|
|
Diluted
|
|
$
|
2.54
|
|
|
$
|
2.34
|
|
|
9
|
|
$
|
5.13
|
|
|
$
|
4.81
|
|
7
|
|
Operating results –
Adjusted(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues –
Adjusted(3)
|
|
|
2,837
|
|
|
|
2,578
|
|
|
10
|
|
|
5,657
|
|
|
|
5,270
|
|
7
|
|
Income before
provisions for credit losses
and income taxes
– Adjusted(3)
|
|
|
1,365
|
|
|
|
1,216
|
|
|
12
|
|
|
2,736
|
|
|
|
2,518
|
|
9
|
|
Net income –
Adjusted(3)
|
|
|
906
|
|
|
|
832
|
|
|
9
|
|
|
1,828
|
|
|
|
1,732
|
|
6
|
|
Return on common
shareholders' equity – Adjusted(4)
|
|
|
16.9
|
%
|
|
|
17.2
|
%
|
|
|
|
|
17.0
|
%
|
|
|
17.8
|
%
|
|
|
Operating leverage –
Adjusted(4)
|
|
|
1.9
|
%
|
|
|
(1.3)
|
%
|
|
|
|
|
1.2
|
%
|
|
|
(1.7)
|
%
|
|
|
Efficiency ratio –
Adjusted(4)
|
|
|
51.9
|
%
|
|
|
52.8
|
%
|
|
|
|
|
51.6
|
%
|
|
|
52.2
|
%
|
|
|
Diluted earnings per
share – Adjusted(3)
|
|
$
|
2.54
|
|
|
$
|
2.34
|
|
|
9
|
|
$
|
5.13
|
|
|
$
|
4.88
|
|
5
|
|
Common share
information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends
declared
|
|
$
|
1.06
|
|
|
$
|
0.97
|
|
|
9
|
|
$
|
2.12
|
|
|
$
|
1.94
|
|
9
|
|
Book
value(2)
|
|
$
|
62.28
|
|
|
$
|
57.45
|
|
|
|
|
$
|
62.28
|
|
|
$
|
57.45
|
|
|
|
Share price
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
High
|
|
$
|
114.68
|
|
|
$
|
103.45
|
|
|
|
|
$
|
114.68
|
|
|
$
|
103.45
|
|
|
|
|
Low
|
|
$
|
101.24
|
|
|
$
|
92.67
|
|
|
|
|
$
|
86.50
|
|
|
$
|
91.02
|
|
|
|
|
Close
|
|
$
|
110.54
|
|
|
$
|
101.03
|
|
|
|
|
$
|
110.54
|
|
|
$
|
101.03
|
|
|
|
Number of common shares
(thousands)
|
|
|
340,056
|
|
|
|
337,720
|
|
|
|
|
|
340,056
|
|
|
|
337,720
|
|
|
|
Market
capitalization
|
|
|
37,590
|
|
|
|
34,120
|
|
|
|
|
|
37,590
|
|
|
|
34,120
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions of Canadian
dollars)
|
|
As at
April 30,
2024
|
|
|
As at
October
31,
2023(1)
|
|
% Change
|
|
Balance sheet and
off-balance-sheet
|
|
|
|
|
|
|
|
|
Total assets
|
|
441,690
|
|
|
423,477
|
|
4
|
|
Loans and acceptances,
net of allowances
|
|
234,770
|
|
|
225,443
|
|
4
|
|
Deposits
|
|
306,881
|
|
|
288,173
|
|
6
|
|
Equity attributable to
common shareholders
|
|
21,179
|
|
|
20,432
|
|
4
|
|
Assets under
administration(2)
|
|
691,554
|
|
|
652,631
|
|
6
|
|
Assets under
management(2)
|
|
138,848
|
|
|
120,858
|
|
15
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory ratios
under Basel III(5)
|
|
|
|
|
|
|
|
|
Capital
ratios
|
|
|
|
|
|
|
|
|
|
Common Equity Tier 1
(CET1)
|
|
13.2
|
%
|
|
13.5
|
%
|
|
|
|
Tier 1
|
|
15.5
|
%
|
|
16.0
|
%
|
|
|
|
Total
|
|
16.7
|
%
|
|
16.8
|
%
|
|
|
Leverage
ratio
|
|
4.4
|
%
|
|
4.4
|
%
|
|
|
TLAC
ratio(5)
|
|
30.2
|
%
|
|
29.2
|
%
|
|
|
TLAC leverage
ratio(5)
|
|
8.5
|
%
|
|
8.0
|
%
|
|
|
Liquidity coverage
ratio (LCR)(5)
|
|
155
|
%
|
|
155
|
%
|
|
|
Net stable funding
ratio (NSFR)(5)
|
|
120
|
%
|
|
118
|
%
|
|
|
Other
information
|
|
|
|
|
|
|
|
|
Number of employees –
Worldwide (full-time equivalent)
|
|
28,665
|
|
|
28,916
|
|
(1)
|
|
Number of branches in
Canada
|
|
369
|
|
|
368
|
|
−
|
|
Number of banking
machines in Canada
|
|
939
|
|
|
944
|
|
(1)
|
|
(1)
|
Certain amounts have
been adjusted to reflect accounting policy changes arising from the
adoption of IFRS 17. For additional information, see Note 2 to the
unaudited interim condensed consolidated financial statements in
the Report to Shareholders – Second Quarter 2024, which is
available on the Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
(2)
|
For details on the
composition of these measures, see the Glossary section on pages 47
to 50 in the Report to Shareholders – Second
Quarter 2024, which is available on the Bank's website at
nbc.ca or the SEDAR+ website at sedarplus.ca.
|
(3)
|
See the Financial
Reporting Method section on pages 3 to 6 for additional information
on non-GAAP financial measures.
|
(4)
|
For additional
information on non-GAAP ratios, see the Financial Reporting Method
section on pages 4 to 10 in the Report to Shareholders
– Second Quarter 2024, which is available on the
Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
(5)
|
For additional
information on capital management measures, see the Financial
Reporting Method section on pages 4 to 10 in the Report to
Shareholders – Second Quarter 2024, which is
available on the Bank's website at nbc.ca or the SEDAR+ website at
sedarplus.ca.
|
Caution Regarding Forward-Looking Statements
Certain statements in this document are forward-looking
statements. All such statements are made in accordance with
applicable securities legislation in Canada and the
United States. The forward-looking statements in this
document may include, but are not limited to, statements made about
the economy, market changes, the Bank's objectives, outlook, and
priorities for fiscal year 2024 and beyond, the strategies or
actions that will be taken to achieve them, expectations for the
Bank's financial condition, its activities, the regulatory
environment in which it operates, its environmental, social, and
governance targets and commitments, and certain risks to which the
Bank is exposed. These forward-looking statements are typically
identified by verbs or words such as "outlook", "believe",
"foresee", "forecast", "anticipate", "estimate", "project",
"expect", "intend" and "plan", in their future or conditional
forms, notably verbs such as "will", "may", "should", "could" or
"would" as well as similar terms and expressions.
Such forward-looking statements are made for the purpose of
assisting the holders of the Bank's securities in understanding the
Bank's financial position and results of operations as at and for
the periods ended on the dates presented, as well as the Bank's
vision, strategic objectives, and performance targets, and may not
be appropriate for other purposes. These forward-looking statements
are based on current expectations, estimates, assumptions and
intentions and are subject to uncertainty and inherent risks, many
of which are beyond the Bank's control. There is a strong
possibility that the Bank's express or implied predictions,
forecasts, projections, expectations, or conclusions will not prove
to be accurate, that its assumptions may not be confirmed, and that
its vision, strategic objectives, and performance targets will not
be achieved. The Bank cautions investors that these forward-looking
statements are not guarantees of future performance and that actual
events or results may differ significantly from these statements
due to a number of factors. Thus, the Bank recommends that readers
not place undue reliance on these forward-looking statements, as a
number of factors could cause actual results to differ
significantly from the expectations, estimates, or intentions
expressed in these forward-looking statements. Investors and others
who rely on the Bank's forward-looking statements should carefully
consider the factors listed below as well as the uncertainties they
represent and the risk they entail. Except as required by law, the
Bank does not undertake to update any forward-looking statements,
whether written or oral, that may be made from time to time, by it
or on its behalf.
Assumptions about the performance of the Canadian and U.S.
economies in 2024 and how that performance will affect the Bank's
business are among the factors considered in setting the Bank's
strategic priorities and objectives, including allowances for
credit losses. These assumptions appear in the Economic Review and
Outlook section and, for each business segment, in the Economic and
Market Review sections of the 2023 Annual Report and in the
Economic Review and Outlook section of the Report to
Shareholders for the second quarter of 2024, and may be updated
in the quarterly reports to shareholders filed thereafter.
The forward-looking statements made in this document are based
on a number of assumptions and are subject to risk factors, many of
which are beyond the Bank's control and the impacts of which are
difficult to predict. These risk factors include, among others, the
general economic environment and financial market conditions in
Canada, the United States, and the other countries
where the Bank operates; the impact of upheavals in the U.S.
banking industry; exchange rate and interest rate fluctuations;
inflation; global supply chain disruptions; higher funding costs
and greater market volatility; changes made to fiscal, monetary,
and other public policies; changes made to regulations that affect
the Bank's business; geopolitical and sociopolitical uncertainty;
climate change, including physical risks and those related to the
transition to a low-carbon economy, and the Bank's ability to
satisfy stakeholder expectations on environmental and social
issues; significant changes in consumer behaviour; the housing
situation, real estate market, and household indebtedness in
Canada; the Bank's ability to
achieve its key short-term priorities and long-term strategies; the
timely development and launch of new products and services; the
Bank's ability to recruit and retain key personnel; technological
innovation, including advances in artificial intelligence and the
open banking system, and heightened competition from established
companies and from competitors offering non-traditional services;
changes in the performance and creditworthiness of the Bank's
clients and counterparties; the Bank's exposure to significant
regulatory matters or litigation; changes made to the accounting
policies used by the Bank to report financial information,
including the uncertainty inherent to assumptions and critical
accounting estimates; changes to tax legislation in the countries
where the Bank operates; changes made to capital and liquidity
guidelines as well as to the presentation and interpretation
thereof; changes to the credit ratings assigned to the Bank by
financial and extra-financial rating agencies; potential
disruptions to key suppliers of goods and services to the Bank; the
potential impacts of disruptions to the Bank's information
technology systems, including cyberattacks as well as identity
theft and theft of personal information; the risk of fraudulent
activity; and possible impacts of major events affecting the
economy, market conditions, or the Bank's outlook, including
international conflicts, natural disasters, public health crises,
and the measures taken in response to these events.
The foregoing list of risk factors is not exhaustive, and the
forward-looking statements made in this document are also subject
to credit risk, market risk, liquidity and funding risk,
operational risk, regulatory compliance risk, reputation risk,
strategic risk, and social and environmental risk as well as
certain emerging risks or risks deemed significant. Additional
information about these factors is provided in the Risk Management
section of the 2023 Annual Report and in the Risk Management
section of the Report to Shareholders for the second quarter
of 2024, and may be updated in the quarterly reports to
shareholders filed thereafter.
Disclosure of the Second Quarter 2024 Results
Conference Call
- A conference call for analysts and institutional investors will
be held on Wednesday, May 29, 2024 at
1:00 p.m. EDT.
- Access by telephone in listen-only mode: 1-800-806-5484 or
416-340-2217. The access code is 8438144#.
- A recording of the conference call can be heard until
August 23, 2024 by dialing
1-800-408-3053 or 905-694-9451. The access code is 8808810#.
Webcast
- The conference call will be webcast live at
nbc.ca/investorrelations.
- A recording of the webcast will also be available on National
Bank's website after the call.
Financial Documents
- The Report to Shareholders (which includes the quarterly
consolidated financial statements) is available at all times on
National Bank's website at nbc.ca/investorrelations.
- The Report to Shareholders, the Supplementary
Financial Information, the Supplementary Regulatory Capital
and Pillar 3 Disclosure, and a slide presentation will be
available on the Investor Relations page of National Bank's website
on the morning of the day of the conference call.
SOURCE National Bank of Canada