Montreal-headquartered National Bank is the smallest of the Big Six Canadian chartered banks and has been known for its focus on Quebec. But it has expanded in the last decade, building a major investment banking and asset management business to complement its strong position in retail banking, as well as a growing US specialty finance subsidiary.
Income Investor
The bank’s share price up 35% since being recommended, despite the upcoming issuance of $1 billion of new equity. This was to help fund the CWB acquisition, of which the Caisse des dépôt in Quebec is buying half. Investors are still enthusiastic about the prospects for National’s growth. CWB adds 39 branches and $39 billion in assets to National’s book, of which $30 billion is commercial lending, while increasing National’s non-Quebec portfolio by 37%. With the quarterly dividend increased by 4%, to $1.14, equivalent to a 3.44% yield, and with the CWB deal having been approved by its shareholders, National returns to being a Buy. - Gavin Graham
Sorry!
Only current subscribers of The Income Investor may view the details of this recommendation.
Interactive Performance Chart
NA was first recommended here on December 21, 2023