BMO Financial Group (TSX:BMO), Bank of Nova Scotia (TSX:BNS) and National Bank of Canada (TSX:NA) all topped analyst expectations in their second-quarter results, with each bank raising its quarterly dividend.
BMO posted the most dramatic profit surge of the three, with net income climbing 34% year-over-year to $2.63 billion, or $3.53 per diluted share, for the quarter ended April 30.
On an adjusted basis, earnings reached $3.67 per diluted share, well ahead of the consensus estimate of $3.45.
Revenue rose to $9.57 billion from $8.68 billion a year earlier, while provisions for credit losses fell sharply to $739 million from $1.05 billion. The bank raised its quarterly dividend to $1.71 per share from $1.67.
Jefferies noted the beat was strong but flagged that much of the upside came from capital markets rather than domestic retail, which underperformed.
BMO also announced the sale of its Transportation and Vendor Finance businesses to Stonepeak, a move expected to trigger a $1.1 billion charge next quarter.
Scotiabank kicked off the reporting season with adjusted earnings of $2.02 per share, topping the consensus estimate of $1.93.
Provisions for credit losses came in at $1.22 billion, above the $1.11 billion estimate, though Jefferies said the result reflected continued efficiency gains and improving profitability across most operating segments.
The exception was Global Banking and Markets, which saw a modest sequential decline. Scotia’s CET1 capital ratio held at 13.3%.
Jefferies raised its target price by $7 to $112, noting the bank is narrowing the gap to peers even as loan growth in its international segment remains negative.
National Bank rounded out the trio with adjusted earnings of $3.23 per share, beating the $3.14 estimate, on adjusted revenue of $3.918 billion against expectations of $3.81 billion.
Capital markets was a standout, with advisory fees up 35% sequentially.
National raised its quarterly dividend by 6.5% to $1.32 per share. Its CET1 ratio edged down 10 basis points to 13.5% following share repurchases.
Shares of Scotiabank rose 1.2% in Toronto trading, while BMO was flat and National Bank slipped 2.7%.