National Bank posts record results for the First Quarter of 2014

 The financial information reported herein is based on the unaudited interim  condensed consolidated financial statements for the first quarter ended  January 31, 2014 and prepared in accordance with International Financial  Reporting Standards (IFRS), as issued by the International Accounting  Standards Board (IASB) and set out in the CPA Canada Handbook. The figures for  the year ended October 31, 2013 have been adjusted to reflect changes in  accounting standards and the impact of the stock dividend of one common share  on each issued and outstanding common share declared on December 3, 2013. The  effect of this dividend was the same as a two-for-one split of common shares.  A financial information supplement issued on January 31, 2014, entitled  "Supplementary Financial Information - Adjusted to Reflect Changes in  Accounting Standards and the Common Stock Split" is available at nbc.ca.  Additional information about National Bank of Canada, including the Report to  shareholders - First Quarter 2014 and the Annual Information Form, can be  obtained from the Bank's website at nbc.ca or on SEDAR website at sedar.com.  MONTREAL, Feb. 24, 2014 /CNW Telbec/ - National Bank is reporting $405 million  in net income for the first quarter of 2014 versus $373 million in the first  quarter of 2013. Diluted earnings per share for the quarter ended January 31,  2014 stood at $1.15, up 10% from $1.05 in the same quarter of 2013.  Excluding the specified items described on page 4, this quarter's net income  was a record amount of $384 million, up 12% from $344 million in the first  quarter of 2013, and the quarter's diluted earnings per share was a record  $1.09, up 12% from $0.97 in the same quarter of 2013.  "First quarter results are showing strong momentum for National Bank," said  Louis Vachon, President and Chief Executive Officer. "In Personal and  Commercial Banking, loan and deposit growth remained strong and net interest  margins improved on a sequential basis. Also, credit quality remained  excellent. Wealth Management benefited from good organic growth and the  contribution from newly acquired TD Waterhouse Institutional Services.  Financial Markets also did well with solid client-driven activities and good  cost control."  Highlights:            --  $405 million in net income for the first quarter of 2014, up 9%             from $373 million in the same quarter of 2013;         --  Diluted earnings per share of $1.15 for the first quarter of             2014, up 10% from $1.05 in the same quarter of 2013;         --  Return on equity of 19.8%;         --  As at January 31, 2014, the Common Equity Tier 1 (CET1) capital             ratio under Basel III was 8.3% versus 8.7% as at October 31,             2013.  Highlights Excluding Specified Items((1):)         --  $384 million in net income for the first quarter of 2014, up             12% from $344 million in the same quarter of 2013;         --  Diluted earnings per share of $1.09 for the first quarter of             2014, up 12% from $0.97 in the same quarter of 2013;         --  Return on equity of 18.8%.     Financial Indicators                                                                                                          Results                                                               excluding                                                   Results     specified                                                   Q1 2014         items (1)                                                                               Growth in diluted earnings per share        10  %         12    %       Return on common shareholders' equity     19.8  %       18.8    %       Dividend payout ratio                       39  %         42    %       CET1 capital ratio under Basel III         8.3  %                                                                                               (1)    See the Financial Reporting Method section on page 4.  Personal and Commercial         --  Net income totalled $168 million in the first quarter of 2014,             up 3% from $163 million in the first quarter of 2013. The             segment's contribution rose $13 million or 5%.         --  At $658 million, first-quarter total revenues rose $19 million             or 3% year over year.         --  Rising 7% from a year ago, personal lending experienced             sustained growth, with the strongest increases coming from             consumer loans and mortgage lending, and commercial lending             grew 5% from a year ago.         --  The net interest margin was 2.25% in the first quarter of 2014             versus 2.24% the preceding quarter and 2.32% in the first             quarter of 2013.         --  At 57.5%, the efficiency ratio improved from 58.2% in the first             quarter of 2013.  Wealth Management         --  The acquisition of TD Waterhouse Institutional Services (TD             Waterhouse) was completed on November 12, 2013.         --  First-quarter net income totalled $68 million, a 42% increase             from $48 million in the same quarter of 2013.         --  First-quarter total revenues amounted to $324 million versus             $277 million in the same quarter of 2013, a $47 million or 17%             increase that was driven particularly by growth across all             revenue streams and by the TD Waterhouse acquisition.         --  First-quarter non-interest expenses stood at $231 million, up             9% year over year.         --  Excluding specified items(1), the efficiency ratio was 68.3%,             an improvement from 73.7% in the first quarter of 2013.  Financial Markets         --  Net income totalled $144 million in the first quarter of 2014,             up 27% from $113 million in the same quarter of 2013.         --  At $365 million, revenues increased $62 million or 20% owing             mainly to growth in trading activity revenues, gains on             available-for-sale securities and other revenues.         --  At $168 million, non-interest expenses increased slightly in             the first quarter of 2014, rising $7 million year over year,             particularly due to higher variable compensation associated             with revenue growth.         --  At 46.0%, the efficiency ratio improved from 53.1% in the first             quarter of 2013.  Other          --  Net income totalled $25 million for the first quarter of 2014             versus $49 million in the same quarter of 2013, a decrease that             stems particularly from a lower contribution from Corporate             Treasury. During the first quarter of 2014, a $33 million rise             in the value of restructured notes was recorded, whereas a             $26 million decrease in past services costs had been recorded             in the first quarter of 2013 to reflect changes to the             provisions in pension plans and other post-retirement plans             subsequent to changes in accounting standards.  Capital Management         --  The Common Equity Tier 1 (CET1) capital ratio under Basel III             was 8.3% as at January 31, 2014 versus 8.7% as at October 31,             2013.         --  The decrease came essentially from the Wealth Management             acquisition and from the coming into force of the credit             valuation adjustment.     (1)  See the Financial Reporting Method section on page 4.     HIGHLIGHTS                                                           (millions of     Canadian dollars)                                                                                                                                Quarter ended                                  January 31                        2014               2013  (1) % Change                                                                                 Operating results                                                           Total revenues       $           1,364   $           1,232           11     Net income                         405                 373            9     Net income                                     attributable to the     Bank's shareholders                389                 356            9     Return on common                               shareholders' equity              19.8 %              20.7   %              Earnings per share                             (2)(dollars)                                                                  Basic              $            1.16   $            1.06            9       Diluted                         1.15                1.05           10                                                                                 EXCLUDING SPECIFIED                            ITEMS(3)                                                                    Operating results                                                           Total revenues       $           1,326   $           1,222            9     Net income                         384                 344           12     Net income                                     attributable to the     Bank's shareholders                368                 327           13     Return on common                               shareholders' equity              18.8 %              19.0   %              Earnings per share                             (2)(dollars)                                                                  Basic              $            1.10   $            0.98           12       Diluted                         1.09                0.97           12                                                                                 Per common share(2)                            (dollars)                                                                   Dividends declared   $            0.46   $            0.41                  Book value                       23.68               20.76                  Stock trading range                                                           High                           46.86               40.02                    Low                            41.72               37.53                    Close                          41.72               39.66                                                                                                                                                                                               As at January 31,   As at October 31,                                       2014                2013 (1) % Change                                                                                 Financial position                                                          Total assets         $         195,300   $         188,219            4     Loans and                                      acceptances                     99,722              97,338            2     Deposits                       111,248             102,111            9     Subordinated debt                              and equity                      11,098              11,379          (2)     Capital ratios under                           Basel III(4)                                                                  Common Equity Tier                   %                                      1 (CET1)                         8.3                 8.7   %       Tier 1                          10.7 %              11.4   %                Total                           13.6 %              15.0   %              Impaired loans, net                            of total allowances              (172)               (183)                    As a % of average                    %                                      loans and       acceptances                    (0.2)               (0.2)   %     Assets under                                   administration and     under management               309,653            258,010            20     Total personal                                 savings                        161,827            157,515             3     Interest coverage                13.58               11.18                  Asset coverage                    3.45                3.76                                                                                              Other information                                                           Number of employees             19,784              19,691      −     Number of branches                             in Canada                          451                 453      −     Number of banking                              machines                           938                 937      −     (1)      Certain amounts have been adjusted to reflect changes in              accounting standards. See Note 2 to the unaudited interim              condensed consolidated financial statements in the Report to              Shareholders for the first quarter ended January 31, 2014.     (2)      Reflecting the impact of the common stock split. See Note 13              to the unaudited interim condensed consolidated financial              statements in the Report to Shareholders for the first quarter              ended January 31, 2014.     (3)      See the Financial Reporting Method section on page 4.     (4)      The ratios have been calculated using the "all-in"              methodology, and the October 31, 2013 ratios have not been              adjusted to reflect changes in accounting standards.     FINANCIAL REPORTING METHOD     (millions of Canadian dollars, except per share amounts)           When assessing its results, the Bank uses certain measures that do not     comply with International Financial Reporting Standards (IFRS), as     issued by the International Accounting Standards Board (IASB) and set     out in the CPA Canada Handbook. Securities regulators require companies     to caution readers that net income and other measures adjusted using     non-IFRS criteria are not standard under IFRS and cannot be easily     compared with similar measures used by other companies.           Finanancial Information           Quarter ended January 31                  2014       2013  (1) % Change                                                                                 Excluding specified items                                                     Personal and Commercial                  168        163            3        Wealth Management                         76         53           43        Financial Markets                        144        113           27        Other                                     (4)        15                                                                                               Net income excluding specified items       384        344           12        Items related to holding                                                    restructured note(2)                      30          9        Acquisition-related items(3)              (9)        (6)                    Item related to employee benefits                                           (4)                                  −         26      Net income                                 405        373            9                                                                                  Diluted earnings per share excluding     specified items(5)                   $    1.09    $  0.97           12        Items related to holding                                                    restructured notes(2)                   0.09       0.03        Acquisition-related items(3)           (0.03)     (0.03)                    Item related to employee benefits                                           (4)                                  −       0.08      Diluted earnings per share(5)        $    1.15    $  1.05           10                                                                                  Return on common shareholders'     equity                                                                        Including specified items               19.8  %    20.7    %                Excluding specified items               18.8  %    19.0    %              (1)   Certain amounts have been adjusted to reflect changes in           accounting standards. See Note 2 to the unaudited interim           condensed consolidated financial statements in the Report to           Shareholders for the first quarter ended January 31, 2014.     (2)   During the quarter ended January 31, 2014, the Bank recorded           $5 million in financing costs ($3 million net of income taxes)           related to holding restructured notes. It also recorded           $45 million in revenues ($33 million net of income taxes) to           reflect the rise in the fair value of these notes (2013:           $12 million in revenues ($9 million net of income taxes) to           reflect the rise in the fair value of the commercial paper not           included in the Pan-Canadian restructuring plan).     (3)   During the quarter ended January 31, 2014, the Bank recorded           $11 million in charges ($9 million net of income taxes) related           mainly to the Wealth Management acquisitions and consisting           mostly of retention bonuses (2013: $8 million, $6 million net of           income taxes) in addition to the Bank's share in the integration           costs incurred by Fiera and its share in the integration costs           and intangible asset amortization related to the Bank's interest           in TMX.     (4)   During the quarter ended January 31, 2013, the Bank recorded a           $35 million decrease ($26 million net of income taxes) in past           service costs to reflect changes to the provisions of its pension           plans and other post-retirement plans subsequent to changes in           accounting standards.     (5)   Reflecting the impact of the common stock split. See Note 13 to           the unaudited interim condensed consolidated financial statements           in the Report to Shareholders for the first quarter ended January           31, 2014.  CAUTION REGARDING FORWARD-LOOKING STATEMENTS  ------------------------------  From time to time, the Bank makes written and oral forward-looking statements,  such as those contained in the "Major Economic Trends" and the "Outlook for  National Bank" sections of the 2013 Annual Report, in other filings with  Canadian securities regulators, and in other communications, for the purpose  of describing the economic environment in which the Bank will operate during  fiscal 2014 and the objectives it has set for itself for that period. These  forward-looking statements are made in accordance with current securities  legislation. They include, among others, statements with respect to the  economy—particularly the Canadian and U.S. economies—market changes,  observations regarding the Bank's objectives and its strategies for achieving  them, Bank-projected financial returns and certain risks faced by the Bank.  These forward-looking statements are typically identified by future or  conditional verbs or words such as "outlook," "believe," "anticipate,"  "estimate," "project," "expect," "intend," "plan," and similar terms and  expressions.  By their very nature, such forward-looking statements require assumptions to  be made and involve inherent risks and uncertainties, both general and  specific. Assumptions about the performance of the Canadian and U.S. economies  in 2014 and how that will affect the Bank's business are among the main  factors considered in setting the Bank's strategic priorities and objectives  and in determining its financial targets, including provisions for credit  losses. In determining its expectations for economic growth, both broadly and  in the financial services sector in particular, the Bank primarily considers  historical economic data provided by the Canadian and U.S. governments and  their agencies.  There is a strong possibility that express or implied projections contained in  these forward-looking statements will not materialize or will not be accurate.  The Bank recommends that readers not place undue reliance on these statements,  as a number of factors, many of which are beyond the Bank's control, could  cause actual future results, conditions, actions or events to differ  significantly from the targets, expectations, estimates or intentions  expressed in the forward-looking statements. These factors include strategic  risk, credit risk, market risk, liquidity risk, operational risk, regulatory  risk, reputation risk, and environmental risk, which are described in more  detail in the "Risk Management" section beginning on page 60 of the 2013  Annual Report, and in particular the general economic environment and  financial market conditions in Canada, the United States and certain other  countries in which the Bank conducts business, including the regulatory  changes affecting the Bank's business, capital and liquidity; the situation  with respect to the restructured notes of the master asset vehicle (MAV)  conduits, in particular the realizable value of underlying assets; changes in  the accounting policies the Bank uses to report its financial condition,  including uncertainties associated with assumptions and critical accounting  estimates; tax laws in the countries in which the Bank operates, primarily  Canada and the United States (including the new reporting regime set out in  sections 1471 to 1474 of the U.S. Internal Revenue Code of 1986 (FATCA)); and  changes to capital adequacy and liquidity guidelines and to the manner in  which they are to be presented and interpreted.  The foregoing list of risk factors is not exhaustive. Additional information  about these factors can be found in the "Risk Management" and "Other Risk  Factors" sections of the 2013 Annual Report. Investors and others who rely on  the Bank's forward-looking statements should carefully consider the above  factors as well as the uncertainties they represent and the risk they entail.  The Bank also cautions readers not to place undue reliance on these  forward-looking statements.  The forward-looking information contained in this document is presented for  the purpose of interpreting the information contained herein and may not be  appropriate for other purposes.  DISCLOSURE OF FIRST QUARTER 2014 RESULTS   ------------------------------  Conference Call         --  A conference call for analysts and institutional investors will             be held on Tuesday, February 25, 2014 at 11 a.m. EST.         --  Access by telephone in listen-only mode: 1-866-862-3930 or             416-695-7806. The access code is 3390539#.         --  A recording of the conference call can be heard until             March 6, 2014 by dialing 1-800-408-3053 or 905-694-9451. The             access code is 5955220#.  Webcast         --  The conference call will be webcast live at             nbc.ca/investorrelations.         --  A recording of the webcast will also be available on National             Bank's website after the call.  Financial Documents         --  The quarterly consolidated financial statements are available             at all times on National Bank's website at             nbc.ca/investorrelations.         --  The Report to Shareholders, Supplementary Financial Information             and a slide presentation will be available on the Investor             Relations page of National Bank's website shortly before the             start of the conference call.    SOURCE  National Bank of Canada  Ghislain Parent Chief Financial Officer and Executive Vice-President Finance  and Treasury 514-394-6807   Jean Dagenais Senior Vice-President Finance, Taxation and Investor Relations  514-394-6233   Claude Breton Assistant Vice-President Public Affairs 514-394-8644   Hélène Baril Senior Director Investor Relations 514-394-0296    To view this news release in HTML formatting, please use the following URL:  http://www.newswire.ca/en/releases/archive/February2014/24/c6629.html  CO: National Bank of Canada ST: Quebec NI: FIN ERN