’s acquisition of ING Direct may have been a blow to the broker channel, but it gave a much-needed boost to the big bank’s second-quarter net income earnings.
In the face of growing credit losses, Scotiabank’s second-quarter net income came in at $1.6 billion, $141 million higher than a year ago – slightly increasing the bank’s adjusted earnings to $1.24 a share, up from $1.16 in the second quarter of 2012.
This was two cents lower than the consensus estimate of $1.26 a share for Q2 2013.
“We continue to have very strong results this quarter driven by very good revenue growth,” Scotiabank CEO Rick Waugh said in a statement. “Each business line made a solid contribution to these good results.”
The overall provision for credit losses ballooned by $79 million from a year earlier to $343 million.
Waugh also pointed to “our diversification and straightforward business model” that allowed the bank to take advantage of “opportunities to grow.”
Scotia announced ING Direct would be leaving the mortgage channel on January 16, after it bought the company for $3.15 billion the previous year. At the time, ING was Canada’s seventh largest mortgage broker lender – officially closing shop on February 16. At the time, companies like Mortgage Architects
stated that they would need to rethink their strategy and seek out the niche lenders that were coming into the market, while others like True North’s CEO Dan Eisner
was prepared to transfer business to Scotia.