Kalkine Media - Summary
- S&P/TSX banking sector index increased by 20 basis points on July 17, 2023.
- Canadian Western Bank (TSX:CWB) generated a total revenue of CA$264.41 million in the April 2023 quarter and has a P/E ratio of 7.99x based on its closing price of CA$26.88 on July 17, 2023.
- VersaBank New, a digital financial institution, reported a total revenue of CA$26.68 million during the April 2023 quarter.
Shares of Royal Bank of Canada (TSX:RY) also saw an uptick of 0.74% on July 17, 2023. The banking sector’s performance outpaced the broader market performance. The ongoing strength of the banking sector can be attributed to the central bank’s latest decision to raise interest rates by 25 basis points in July.
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With that, let us look at two banking sector stocks listed on TSX that can be examined amid the current visible uptick in the sector.
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Canadian Western Bank (TSX: CWB)
Over the April 2023 quarter, CWB generated a total revenue of CA$264.41 million, compared to CA$258.76 million in the April 2022 quarter. During the quarter, the bank reported net income to common shareholders of CA$70 million, which was 26% lower than that during the previous quarter.
Image source: ©2023 Kalkine®; Data source: Company Reports
As per the company's reports, the loss in net income came because of a 21-basis-point increase in the provision for credit losses as a proportion of average loans.
CWB has a P/E ratio of 7.99x based on its closing price of CA$26.88 on July 17, 2023. The stock’s closing price on Monday marked a monthly gain of 7.82%.
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VersaBank New (TSX: VBNK)
The digital banking institution reported a total revenue of CA$26.68 million during the April 2023 quarter. Meanwhile, the bank’s net income rose 108% on a year-on-year basis to CA$10.26 million during the quarter. By the end of the quarter, VBNK’s total assets amounted to CA$3.73 billion.
Image source: ©2023 Kalkine®; Data source: Company Reports
VBNK has a P/E ratio of 8.97x based on its closing price of CA$10.50 on July 17, 2023. VBNK’s closing price on Friday marked one-month returns of 3.75% and YTD returns of 3.35%.