Scotiabank's Global Wealth Unit Posts Income Rise

Harriet Davies

30 May 2012

Net income from global wealth management shot up 23.9 per cent at Scotiabank year-over-year to C$298 million ($289.9 million) for the quarter ended 30 April 2012. The comparison excludes acquisition related gains in Q2 2011.

Net income at the division fell 40 per cent year-over-year when acquisition effects aren’t excluded. In Q2 last year there was a one-time revaluation of Scotiabank’s 18 per cent investment in DundeeWealth, partly offset by integration and transaction costs in that period. (Scotiabank completed its acquisition of DundeeWealth in February 2011.)

Revenues at global wealth management rose 18.1 per cent year-over-year, again excluding acquisition-related gains in 2011, to C$905 million. Revenues at wealth management (excluding insurance) were C$764 million, compared to C$732 million a year earlier.

Assets under management in global wealth were C$109 billion at quarter-end, compared to C$106 billion at the end of the first quarter. Assets under administration were C$275 billion, compared to C$269 billion at the end of Q1.

The firm said it had logged “strong growth in global insurance and solid results in asset management” but that online brokerage revenues were lower year-over-year.

Expenses decreased due to one-time acquisition costs registered in Q2 2011, while costs remained flat at “most of the other wealth and insurance businesses.”

Across the group, Scotiabank reported net income of C$1.46 billion, down from C$1.62 billion a year earlier (including acquisition effects in 2011). The bank had a Tier 1 Capital ratio of 12.2 per cent at 30 April 2012.