MONTREAL: National Bank of Canada, one of the country’s largest banks, has reported a 5% decrease in net income for the second quarter of 2023, compared to the same period last year. The bank’s net income for the quarter stood at $847 million, or $2.38 per diluted share, down from $889 million, or $2.53 per diluted share, in Q2 2022.
The bank attributed the decline to higher non-interest expenses and higher provisions for credit losses, which offset revenue growth across its business segments. The bank increased its provisions for credit losses by $51 million, or 28%, to reflect a less favourable macroeconomic outlook due to the ongoing COVID-19 pandemic.
For the first half of 2023, the bank’s net income totalled $1,728 million, or $4.87 per diluted share, down 5% from $1,819 million, or $5.17 per diluted share, in the first half of 2022. The bank also recorded a $24 million tax expense related to the Canadian government’s 2022 tax measures, which reduced its earnings by $0.07 per share.
Excluding this tax expense, the bank’s adjusted net income(1) for the first half of 2023 was $1,752 million, or $4.94 per diluted share, down 4% from the same period last year.
Laurent Ferreira, President and Chief Executive Officer of National Bank of Canada, said that the bank delivered solid results and an industry-leading return on equity despite a challenging environment. He added that the bank’s strong capital and liquidity positions and prudent levels of allowances for credit losses will support its profitable growth and help it navigate the uncertainty that may lie ahead.
It has over 23,000 employees and operates more than 400 branches across Canada.