BUSINESS
03/01/2012 04:39 EST | Updated 05/01/2012 05:12 EDT

National Bank reports first-quarter profit of $332 million, up from year ago

MONTREAL - National Bank (TSX:NA) has reported a first-quarter profit of $332 million, up from $322 million a year ago, helped by growth in personal and commercial banking as well as performance in its financial markets business.

"In addition, the credit quality is excellent and the bank continues to prudently manage its expenses and maintain a sound capital position," National Bank president and chief executive Louis Vachon said in a statement accompanying the results, which were issued after markets closed on Thursday.

The bank said the profit amounted to $1.99 per diluted share for the quarter ended Jan. 31 up from $1.86 a year ago. Revenue totalled $1.24 billion, up from $1.16 billion.

Excluding one-time items, the bank said it earned $334 million or $2 per diluted share, up from $322 million or $1.86 per share a year ago.

The average analyst estimate had been for a profit of $1.82 per share on $1.15 billion in revenue, according to those polled by Thomson Reuters.

National Bank's personal and commercial banking business saw its earnings increase nine per cent in the quarter to $170 million for the quarter, while it also saw an increase in home mortgages.

The financial markets division earned $129 million for the quarter, up from $114 million in the same quarter of 2011, helped by higher revenues from fixed-income securities trading, offset by lower revenues from the trading of equities, commodity securities and foreign exchange transactions.

Wealth management saw its earnings slip to $33 million for the quarter, down from $48 million.

Last week, National Bank signed a deal to sell its asset management business to Fiera Sceptre Inc. (TSX:FSZ) in a $309.5-million agreement that will see it take a large stake in the business.

National Bank will swap Natcan Investment Management Inc. for a 35 per cent stake in Fiera, a Montreal-based independent investment firm.

Natcan will be incorporated into Fiera's existing business, a move the company said will position it as one of Canada's top five independent asset managers.

Fiera also plans to change its name to Fiera Capital when the deal closes.

Banks see wealth management, which provides advice on investments like retirement savings, as a growing business as the population ages.

Canada's sixth-largest bank is also part of the consortium that formed Maple Group to bid for TMX Group Inc. (TSX:X), owner of the Toronto Stock Exchange.

National Bank's vice-chairman, Luc Bertrand, is spokesman for the group.

Shares in National Bank, which reported its results after the close of markets, were up 40 cents at $77.48 on the Toronto Stock Exchange on Thursday.