Thursday, July 27, 2006

Scotiabank Mexico Q2 Net Profit Rises 66% to Mxn1.50B

Dow Jones, 27 July 2006

Mexico's Grupo Scotiabank SA said Thursday that its second-quarter net profit rose by two-thirds on the year, on the back of credit growth and a one-time tax gain.

The local unit of Canada's Bank of Nova Scotia reported a profit of 1.50 billion pesos ($138 million), up from MXN905 million in the same period last year, the bank said in a release.

Scotiabank reported an extraordinary gain of MXN494 million due to a tax refund.

Revenue rose 37% to MXN3.34 billion, with the company's core banking accounting for 96% of that.

Scotiabank's net interest income - what it makes on loans minus what it pays on deposits - was MXN1.77 billion in the first quarter, up 16% from the year-ago period amid growth in consumer loans.

The bank's performing loan portfolio at the end of the quarter was MXN82.94 billion, up 13% on the year. Mortgages grew 30%, auto loans and credit cards expanded 38%, while lending to financial companies and the government was flat.

Scotiabank's loan-loss reserves fell to 174% of past-due loans from 195% a year earlier, while its past-due loan ratio declined to 2.0% from 2.3%.