Scotiabank Q4 earnings climb 6%

Scotiabank on Thursdayreported a six per cent profit increasefor the last quarter of the year, as the bank increased its dividend.

The bank said it made $954 million, or 95 cents a share, up from $897 million, or 89 cents a share, a year earlier.

Return on equity slipped slightly to 21 per cent versus 21.1 per cent in the same quarter of 2006.

Scotiabank's results included pre-tax losses of $191 million on structured credit instruments, including non-bank asset-backed commercial paper, along with a gain of $202 million on the bank's interests in Visa Inc.

The bank increased its quarterly dividend by two cents to 47 cents per common share.

"Although market conditions were challenging in the fourth quarter, the bank continued to achieve solid earnings," president and CEO Rick Waugh said. "The market losses taken were low in relation to our overall trading and investment results."

The bank said it has no direct exposure to U.S. subprime mortgages and only nominal holdings of non-bank asset-backed commercial paper subject to the Montreal Accord, which involves major market players trying to shift short-term debt into longer-term forms. Scotiabank also said it does not sponsor or manage any structured investment vehicles

"One of our core strengths is risk management, and we will continue to prudently manage our risk/reward balance in 2008," Waugh said in a release.

Shares of Scotiabank rose 21 cents to close at $52.36 on the TSX.

Big six banks had record year

Scotiabank was the last of the big six Canadian banks to report their Q4 and full-year earnings. Despite the challenges posed by the subprime slump andthe ensuingcredit squeeze, fiscal 2007 was a lucrative one for many of the banks.

Three of them Scotiabank, CIBC, and Royal Bank posted record annual profits. Overall, the six banks reported that total 2007 profits rose 2.7 per cent to $19.51 billion.