The Daily Chase: RBC beats profit expectations in Q4; National Bank reports profit down

Another day, another profit beat from one of the Big Six banks. This time around, its Royal Bank of Canada’s turn – adjusted earnings per share came in at $2.78 per share, easily topping the average estimate for $2.69. It was the usual suspects driving the beat – net interest margins (basically the spread between the rate the bank borrows at and the rate it charges its own borrowers) expanded, in no small part over at its Canadian Banking and Wealth Management division.

…AND A MISS OVER AT NATIONAL BANK

Almost a case of “similar story, different result” when it comes to National Bank of Canada. Diluted earnings per share came in at $2.08 in the fiscal fourth quarter, well shy of the $2.24 estimate, as a rise in – you guessed it – provisions for credit losses took a toll on the bottom line. Compounding National’s troubles was a weak showing from the capital markets division, which succumbed to a broad slowdown in activity, sending profit 14 per cent lower in the quarter. That said, couple of bright spots for investors – National is raising its quarterly dividend by five cents to 97 cents per share, and the board announced a normal course issuer bid to buy back about 2.1 per cent of the company’s shares outstanding.