Scotiabank CEO bullish on NAFTA deal as profits grow

The chief executive TORONTO of the Bank of Nova Scotia said Tuesday that a deal cut by Mexico and the United States in the NAFTA talks is a positive development that comes as the lender is eyeing further growth in the so-called Pacific Alliance countries.

Scotiabank president and CEO Brian Porter told reporters on a conference call that the preliminary “United States– Mexico Trade Agreement” announced Monday — which doesn’t include Canada — was “a solid step in the right direction.”

“(The deal) alleviates a bit of ambiguity in the market’s mind,” Porter said. “We view yesterday’s development as very positive.”

Canada’s big banks have been keeping a close watch on the NAFTA talks. While they still make the bulk of their money at home, their businesses have also spread across the continent, leaving them exposed to trade uncertainty on a number of fronts.

Scotiabank is also the fifthlargest lender in Mexico, according to its CEO.

“We look forward to the next piece of NAFTA being solved, hopefully in a number of weeks,” Porter said. “That’s with Canada’s inclusion, and that would be positive.

“As an organization, we’re a believer in the free movement of people and goods across markets, and we’re looking forward to the next stage in the negotiations,” he added.

Porter’s comments came after Scotiabank reported thirdquarter profit of approximately $1.94 billion for the three months ended July 31, down from $2.1 billion a year ago.

The results were held back by around $320 million in aftertax costs related to the lender’s recent acquisitions. Scotiabank completed its approximately $950-million purchase of investment firm Jarislowsky Fraser during the quarter, in addition to acquisitions of BBVA Chile and the operations of Citibank Colombia.

Yet even after the recent shopping spree in Canada and Latin America, Porter said the bank would still look at increasing its presence in Mexico.

“If there was something additive to do in Mexico, at the right time, at the right price, we’d certainly look at doing something,” he told reporters.

The bank’s income from Mexico was roughly $169 million for the period.