National Bank of Canada’s profit falls on bigger loan loss provisions

Aug 30 (Reuters) – National Bank of Canada (NA.TO) posted a drop in its third-quarter adjusted profit on Wednesday, as the lender set aside more capital to cover for potential bad loans in a tough economy.

The Montreal-based bank, the smallest of Canada’s big six banks, is the latest to aside more funds in case consumers have trouble paying back their loans and mortgages amid the central bank’s interest rate hikes and rising costs of living.

The bank recorded C$111 million as provision for credit losses in the quarter, compared with C$57 million a year earlier.

Chief Executive Officer Laurent Ferreira said the results were offset by a less constructive backdrop in the financial markets segment, which includes advisory services in the areas of mergers and acquisitions and financing.

The bank’s adjusted profit for the three months ended July 31 was C$790 million ($582.42 million), or C$2.21 per share, compared with C$826 million, or C$2.35 per share, a year earlier.

($1 = 1.3564 Canadian dollars)

Our Standards: The Thomson Reuters Trust Principles.