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Scotiabank to record C$275 mln 2nd-quarter restructuring charge

Published 2016-05-02, 10:25 a/m
© Reuters. Scotiabank to record C$275 mln 2nd-quarter restructuring charge
BNS
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TORONTO, May 2 (Reuters) - Bank of Nova Scotia BNS.TO will
book a second-quarter restructuring charge of about C$275
million ($219.33 million) as part of its effort to improve
productivity and drive "digital transformation", Canada's
third-biggest lender said on Monday.
The bank, which operates under the Scotiabank banner, said
in October it was cutting an undisclosed number of jobs as part
of a cost-reduction strategy. It cited technology changes as one
reason.
The lender, which is expected to report its fiscal
second-quarter results on May 31, said the charge will equate to
about 22 Canadian cents a share.
In a research note, CIBC analyst Robert Sedran suggested
there could be more such charges to come.
"Given the underlying trends and the need to deal with
legacy systems and processes that will preoccupy bank management
for the next several years, this type of charge has a run-rate
feel to it," he said.
Bank of Nova Scotia shares were down 0.7 percent at C$65.31
in early trading in Toronto. Other major Canadian bank shares
were also lower on Monday.
Banks have been looking to cut costs and drive technology
changes as customers increasingly move away from
brick-and-mortar branches to online transactions.
($1 = 1.2538 Canadian dollars)

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