National Bank of Canada Earnings Call Nuggets: Financial Market Recovery and Deploying Excess Capital

National Bank of Canada (NA) recently reported its first quarter earnings and discussed the following topics in its earnings conference call.

Financial Market Recovery

Stephen Theriault – Bank of America Merrill Lynch: I have a couple of questions, first I think for Bill, Bill, can you tell us a little bit more about the nature of the recovery in Financial Markets this quarter is quite a large number and as I look back, there hasn’t been a provision north of, I think, C$5 million since 2009. So, where did the recovery come from?

William Bonnell – EVP, Risk Management: There were a couple of repayments during the quarter in Financial Markets and one of those repayments was from an old file dated at least prior to 2009 time.

Stephen Theriault – Bank of America Merrill Lynch: So it is just really long dated timing on this stuff?

William Bonnell – EVP, Risk Management: Yes.

Stephen Theriault – Bank of America Merrill Lynch: (Indiscernible), please, this is a first time we’ve seen expenses improve in pretty dramatic fashion since the acquisitions. So can you talk a bit about the sustainability there? How sustainable is the improvement we saw this quarter? Are we turning the corner here really on expenses?

Ghislain Parent – CFO and EVP, Finance and Treasury: The answer to that is yes. We’ve worked hard. We have a good momentum both on the revenue and on the expense side and I don’t see major changes. That’s not a one-time normally.

Stephen Theriault – Bank of America Merrill Lynch: So we’ve moved from sort of the mid-70s op the low 70s, you would say?

Ghislain Parent – CFO and EVP, Finance and Treasury: I think so.