"Our focus has not been on smaller, less wealthy holders of cards that will increase their credit card balance," president and CEO Louis Vachon said Wednesday during a conference all with analysts.
"All our focus, most of our focus, has been on premium, platinum and World Elite cards so we're very happy to see that paying off."
Credit card revenues increased by $17 million, or six per cent, in the bank's latest quarter, helped by growing profits from interest income, foreign exchange revenues, interchange revenues and annual fees revenue.
Vachon credits the boost to a number of marketing campaigns National Bank has been running as part of an effort to lure non-clients and those from its wealth management division. Among the lures is an exclusive lounge at Montreal' Dorval airport open to those who hold National Bank Mastercard Elite cards.
"We've not invested a lot in upscale marketing for platinum and world elite types," he said. "So I'm very happy to see increased income because we saw the increased expense for that lounge for the last 12 months."
The Montreal-based bank reported Wednesday that its net profits grew by 10 per cent in the third quarter, helped by growth in its wealth management and financial markets services.
National Bank said it had net income of $441 million, up from $402 million in the same period a year earlier. The earnings amounted to $1.24 per diluted share versus $1.16 year-over-year.
Excluding specific items, National Bank had an adjusted net income of $427 million, up 14 per cent from $374 million in the third quarter of 2013.
Adjusted diluted earnings per share were $1.20 for the quarter, easily beating analyst expectations of $1.11, according to estimates compiled by Thomson Reuters.
On the Toronto Stock Exchange, National Bank (TSX:NA) shares gained $1.51 or 3.06 per cent to $50.91, six cents short of the all-time high it hit earlier in the session.
Total revenues were $1.42 billion, up from $1.29 billion in the same period last year.
The bank's wealth management segment had net income totalling $64 million in the quarter, a 31 per cent increase from $49 million in the same quarter of 2013.
Net income for the bank's financial markets segment was $187 million, up 21 per cent from $155 million year-over-year.
Barclays analyst John Aiken called the results a "standout quarter" for National Bank, which saw trading up 25 per cent and advisory fees climb by 36 per cent compared with a year ago.
"Once again, National reported a very strong quarter, coming in meaningfully ahead of expectations," he wrote.
"While the market does not typically give NA credit for its consistent outperformance in trading revenues or advisory fees, this quarter also featured strong earnings within its retail banking operations, evidenced by relatively strong sequential loan and revenue growth and impressive operating leverage."
Return on equity for the quarter was 19.4 per cent compared with 20.1 per cent year-over-year.
The last of the six major Canadian banks — Canadian Imperial Bank of Commerce (TSX:CM) and Toronto-Dominion Bank (TSX:TD) — report their earnings Thursday.