DESPITE high interest rate challenges and other headwinds impacting the financial environment, Scotia Group continued to witness strong results, delivering solid profit out-turns and commendable segment performances up to the end of its nine-month period in July.

The 134-year-old entity’s profit jumped 74.2 per cent to $12.8 billion for the nine months when compared to the same period last year. Its third-quarter results, which also registered profits of $5.2 billion, reflected an increase of $952 million or 22.6 per cent above that in 2022, and this ably backed by group revenues of $41.5 billion — a 31.5 per cent increase year on year.

“The Scotia Group year-to-date performance is a result of an execution of our strategy of prudent risk management, efficient management of our operations, seamless execution of our digital transformation agenda, focus on our customer experience, along with our delivery of a wide range of products and services through a team of highly trained professional bankers,” president and CEO Audrey Tugwell Henry said at a media briefing on Monday.

During the period total assets, which also climbed to $646.4 billion, was primarily driven, the CEO said, by significant growth in the bank’s loan portfolio, increasing by $40.5 billion or 18.5 per cent over the same period last year.

Particularly pleased about its loan performance, Tugwell Henry attributed the growth of this segment to the bank’s ability to not just create, but to add value for its customers, especially those across its real estate and commercial banking portfolios whose borrowing appetite it has tried to feed based on their respective post-COVID needs for homeownership and/or business expansion.

To this end, the bank for the period reported year-on-year growth of some 20 per cent in its commercial banking business, 29 per cent in the retail mortgage portfolio, and 10 per cent for its flagship Scotia Plan loan product. Its deposit portfolio, which on the other hand also went up by some 12 per cent, stood at $445.2 billion at the end of the period, followed by growth in all subsidiaries including its Scotia General Insurance Agency (the newest addition) which the CEO said was already off to a good start.

“We are very confident in our lending… right now our delinquency rate is significantly below the standards within the industry and we will continue to employ prudent credit risk management along with other policies and strategies as we further expand our portfolios,” she stated.

The CEO said while the bank was not currently considering additional increases in its rates, prevailing uncertainties around market volatility globally, coupled with future decisions of the local central bank, will however determine how it proceeds going forward.

“We are very proud of our overall strong financial performance — for the reporting period our return on equity was 15.7 per cent, our return on assets 2.6 per cent, and our productivity ratio ranking among the best in class at 50.2 per cent.

“In terms of our capital… we continue to be a financial fortress, exceeding all regulatory capital requirements across all business lines,” she further stated, underscoring the bank’s strong balance sheet as being critical to its ability to positively respond to changes and to take advantage of future growth opportunities.

Reporting a strong take-up of its recently rolled-out American Express platinum Scotiabank metal card service, the bank said there was significant interest around the product which was specifically launched to cater to the premium travel, leisure, and entertainment needs of its higher-value clients.

The bank, now in the process of updating its terminals to add more merchants (which it has been doing on a phased basis since August) said it is now working to complete the process within the next few weeks.

Declaring dividends of $0.40 per stock unit for the quarter, the CEO said this was to be made payable to shareholders on October 19, 2023.

“We are very pleased to deliver another quarter of strong results to our shareholders. Our performance is a clear demonstration of precise execution of our strategy. We continue to do well, though we recognise that there are challenges and will continue to work through these challenges, but as we do so we remain very optimistic as we look to close out our fourth quarter,” Tugwell Henry concluded.