The Global Wealth Management business line of Scotiabank has reported a 37% growth in Q1 2021 profit driven by higher mutual fund fees, brokerage revenues, and performance fees. These outweighed higher non-interest expenses.
The division’s net income attributable to equity holders in Q1 2021 stood at C$418m, versus C$306m in the same quarter of 2020.
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Adjusted net income attributable to equity holders increased 34% to C$425m from C$318m over the period.
The business line, launched in 2019, posted total revenue of C$1.39bn in the quarter to January 2021. This is a 20% surge from the previous year figure of C$1.16bn.
Net interest income increased 10% to C$155m from C$141m. Non-interest expenses rose to c$817m from C$737m.
Net income attributable to equity holders at the Global Banking and Markets arm was C$543m in Q1 2021, compared with C$372m in the prior year.
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By GlobalDataHigher net interest income and non-interest income, along with lower non-interest expenses resulted in a 20% growth in adjusted net income attributable to equity holders at the unit.
The division’s total revenue rose 14% year-on-year to C$1.34bn.
Group performance
Overall, the banking group’s reported profit rose to C$2.31bn from C$2.29bn.
Loan loss provisions dropped to C$764m in Q1 2021 from C$1.13bn in the previous year and C$926 a year earlier.
The bank’s common equity tier 1 capital ratio was 12.2% at the end of January 2021, up around 40 basis points from the previous quarter.
This was the result of “strong internal capital generation, lower risk-weighted assets and the impact from employee pension and post-retirement benefits”, noted the bank.
Scotiabank president and CEO Brian Porter said: “We demonstrated positive revenue growth and solid expense discipline to produce high quality earnings and generate positive operating leverage in all our businesses.
“Our CET1 ratio of 12.2% provides us with additional flexibility for capital deployment in the future. We also witnessed continued strength in digital adoption across all our core markets.”
