The Bank of Nova Scotia (NYSE:BNS) Q4 2015 Earnings Conference Call - Final Transcript

Nov 30, 2015 • 04:00 pm ET


The Bank of Nova Scotia (NYSE:BNS) Q4 2015 Earnings Conference Call - Final Transcript


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Jake Lawrence

Good morning and welcome to Scotia Bank's 2015 Fourth Quarter Results Presentation. My name is Jake Lawrence; I'm the Senior Vice President of Investor Relations for the bank. Presenting to you this morning is Brian Porter, Scotia Bank's President and Chief Executive Officer; Sean McGuckin, our Chief Financial Officer; and Stephen Hart, the bank's Chief Risk Officer. Following our comments we'll be glad to take your questions. Also in the room with us to take questions are Scotia Bank's Business Line Group heads, James O'Sullivan from Canadian Banking; Dieter Jentsch from International Banking; and Mike Durland from Global Banking and Markets.

Before we start, and on behalf of those speaking today I would like to refer you to slide number two of our presentation, which contains Scotia Bank's caution regarding forward-looking statements.

With that, I will now turn the call over to Brian Porter.

Brian Porter

Thank you, Jake and good morning, everyone. I'll be starting on slide four. In 2015, the Bank performed well despite some challenging operating conditions. For example, in the past year we have seen volatility in capital markets, a significant decline in oil prices, continued low interest rates and uneven global growth. Notwithstanding these challenges the bank earned $7.2 billion for the year.

On an adjusted basis, 2015 diluted earnings per share grew 4.4% from 2014. Our return on equity was 14.6%. This year's earnings growth was driven by very good performances in our personal, wealth and commercial banking businesses both here in Canada and internationally. These businesses generated approximately three quarters of our earnings.

In Canadian Banking, we had a very strong year with adjusted earnings of 10%. These results reflected good core asset growth particularly in credit cards, auto loans and commercial banking. Our asset growth was supported by strong checking and savings deposit growth. This year we have continued to make progress on growing our payments business, which deepens customer relationships and enhances returns. For example, of the total new credit cards issued in 2015, 80% were to existing Scotia Bank customers. And the growth in the business contributed to Canadian Bank's improved margin. Our wealth management businesses in Canada also performed very well, with results up 13%.

In International Banking, we delivered the improved performance we expected in the second half of fiscal 2015 with record earnings in Q4. The business saw a good volume growth particularly in Latin America as well as a stabilization of margins and credit losses and the benefit of foreign currency translation. More importantly we continue to build profitable market share in our key Pacific clients' countries and remained well positioned for future growth in the region, which we will showcase at our upcoming Investor Day in January 2016.

In Global Banking and Markets the business delivered weaker results. This performance was affected by several factors including challenging market conditions in the energy and mining sectors, margin compression which offset our strong loan growth and lower contribution from Asia. We expect improved results from Global Banking and Markets next