the top 6 canadian banks selected indicators of fy 2014 results - d pershad -dec 2014
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The Top 6 Canadian Banks:
Selected Indicators of FY 2014 ResultsDecember 2014
December 2014
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Contents
Overview 3.
Key Performance Indicators 4.
Total Revenue 5.
Net Income 6.
Return on Equity 7.
Earnings Per Share 8.
Summation 9.
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Canada's Top 6 Banks – A banner 2014, but anticipation of a more challenging 2015
• Net income for the top 6 Canadian banks reached around $33.3 billion in FY 2014*, a healthy increase of 8.6% vs. FY 2013
• While the top 3 banks (RBC, TD, and Scotia) led in net income growth, CIBC actually saw a slight decline vs. FY 2013
• Perhaps anticipating a slowdown in growth due to a variety of factors such as topped-out domestic lending and low commodity prices, some institutions are proactively cutting back staff (e.g. Scotia) or divesting businesses due to soft regional business activity (e.g. RBC in the Caribbean)**
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* The banks’ fiscal year is Nov 1- Oct 31** Globe and Mail, Nov. 30 2014
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Key Performance Indicators
Among the key performance indicators for the top 6 banks are:
• Total Revenue
• Net Income
• ROE (Return on Equity)
• EPS (Earnings per Share)
The following charts show how each bank performed in a universe of top 6 bank results.(Sources: Reported Top 6 Banks’ FY 2014 results)
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Top 6 Banks – FY 2014 % Share of Top 6 Revenue
• RBC continued unsurprisingly, to lead in total revenue for FY 2014, followed by TD and Scotiabank
• RBC also showed the greatest positive % growth VYA
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Top 6 Banks – FY 2014 % Share of Top 6 Net Income
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• While RBC clearly led in reported net income for FY 2014, TD showed the greatest % growth vs. a year ago (VYA)
• Of the top 6 banks, only CIBC actually showed a % decline in reported net income VYA
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Top 6 Banks – FY 2014 Return on Equity (ROE)
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• Return on equity, which takes into account the retained earnings from previous years, declined for 5 of the 6 major banks
• While RBC and CIBC led in FY 2014 ROE, TD was the only bank that showed a positive growth in ROE VYA
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Top 6 Banks FY 2014 Earnings Per Share (EPS)
• Preventing a clean sweep by RBC, National Bank led in Earnings per Share (EPS)
• Both CIBC and RBC however posted significant improvements vs. Q3 2011
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• While CIBC led in reported EPS, TD showed the greatest % growth VYA, though it still ranked last in reported EPS
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Deepak Pershad, Principal
www.insightsbydesign.ca
416.925.6536