Feb 26 (Reuters) - Bank of Nova Scotia BNS.TO , Canada's third-biggest lender, reported a lower-than-expected adjusted quarterly profit on Tuesday, as higher expenses and provision for bad loans ate into gains from its international banking and wealth management.
In contrast, smaller peer Bank of Montreal BMO.TO reported quarterly profit that trounced analysts' estimates, benefiting from increased lending in the United States.
Nova Scotia's adjusted non-interest expenses in the quarter rose 18 percent to C$4.11 billion ($3.11 billion) in the first quarter ended Jan. 31. Scotiabank 's provisions for credit losses, or the money a bank sets aside to cover bad loans, rose 26.5 percent, while it declined at Bank of Montreal.
Net income from Scotiabank's Canadian business fell by 2.6 percent to C$1.07 billion, but it rose 23.2 percent from its relatively smaller international business unit.
The bank has been focusing its international operations on the Pacific Alliance trading bloc of Peru, Mexico, Chile and Columbia, which now accounts for around a quarter of its revenue.
Markets revenue, which includes trading in bonds and equities, at both the banks fell, as volatility in the wake of uncertainty over the U.S.-China trade tensions, Brexit, and other geopolitical concerns resulted in a massive sell-off in global stocks, and kept investors on the sidelines.
Scotiabank reported an adjusted net profit of C$1.75 per share, missing estimates of C$1.82, according to IBES data from Refinitiv. https://reut.rs/2Nuxg0L
Bank of Montreal BMO.TO , the country's fourth-biggest lender, reported earnings per share, excluding special items, of C$2.32, in the quarter to Jan. 31, beating analysts' expectations of C$2.25, according to IBES data from Refinitiv. = 1.3216 Canadian dollars)