BMO and Scotiabank in Canada report decreased income due to increased provisions.

Canadian Banks Report Lower Earnings Amid Economic Uncertainty

Bank of Montreal and Bank of Nova Scotia reported lower adjusted earnings at home as the Canadian banks set aside higher provisions. Adjusted income from Scotiabank’s Canadian banking segment fell 10% while that of BMO’s fell 8%, reflecting higher provisions for credit losses.

The results come as investor confidence has deteriorated in markets amid high volatility triggered by U.S. banking turmoil and a relentless rate-hiking cycle. However, BMO reported a rise in second-quarter profit as higher interest rates shored up its net interest income.

Provisions for credit losses jumped to C$709 million from C$219 million, due to economic uncertainty and challenging market conditions in Chile and Colombia amid rising inflation, Scotiabank said. BMO said adjusted provision for credit losses was C$318 million at the end of the second quarter, compared with C$50 million a year ago.

Despite the challenges, Canadian banks remain resilient. BMO’s net income, excluding one-off items, rose to C$2.22 billion ($1.65 billion), or C$2.93 per share, for the three months ended April 30, compared with C$2.19 billion, or C$3.23 a share. For Scotiabank, it fell to C$2.17 billion ($1.62 billion), or C$1.7 a share, from C$2.77 billion, or C$2.18 a share, a year earlier.

Other News:

• Ron DeSantis may finally be entering the ring to challenge Trump in 2024.
• Denisha Allen, founder of ‘Black Minds Matter,’ shares her thoughts on the NAACP’s recent decision to issue a travel advisory against Florida.
• A new record label, Baste Records, aims to promote tradition music values and resist the influence of political correctness.
• Ride-hailing platform Uber Technologies is stepping up its efforts to go green.
• Xiaomi Corp reported a 18.9% drop in quarterly revenue on Wednesday as consumer demand for smartphones remained weak.
• Figure, a startup that wants to build general-purpose humanoid robots, has raised $70 million from investors.
• S&P Global Ratings cut SoftBank Group Corp’s long-term rating deeper into junk territory on Tuesday.