National Bank raises dividend 23% but misses profit expectations

National Bank said Wednesday it will now pay a dividend of 87 cents per share, up from 71 cents per share.

National Bank of Canada raised its quarterly dividend 23 per cent as it reported a fourth-quarter profit of $776 million, up from $492 million a year earlier.

The Montreal-based bank said Wednesday it will now pay a dividend of 87 cents per share, up from 71 cents per share. National Bank also said it plans to buy back up to seven million of its shares.

The announcement follows a decision last month by the federal banking regulator to lift restrictions put in place at the start of the pandemic that prevented federally regulated banks and insurers from raising dividends, buying back shares and raising executive compensation.

National Bank said its profit amounted to $2.19 per diluted share, up from $1.36 per diluted share in the same quarter last year. Revenue totalled $2.2 billion, up from $2 billion a year ago.

“The bank’s sustained performance reinforces our commitment to continue pursuing fitting strategies in terms of business mix, capital allocation, and risk management,” National Bank chief executive Laurent Ferreira said in a statement.

“We enter the new year on strong footing, well-positioned to generate solid growth across our business segments and deliver superior returns to our shareholders.”

Excluding specified items, National Bank said it earned $2.21 per diluted share, up from $1.69 per diluted share in the same quarter last year.