Topic: How To Invest

The Successful Investor Hotline – Friday, December 3, 2021

Article Excerpt

BANK OF NOVA SCOTIA, $83.92, Toronto symbol BNS, is a buy. Canada’s banking regulator—the Office of the Superintendent of Financial Institutions (OFSI)—has lifted the restrictions on capital distributions it placed on banks and insurers in March 2020 due to COVID-19 uncertainty. As a result, Bank of Nova Scotia is now raising your quarterly dividend by 11.1%. Starting with the January 2022 payment, investors will receive $1.00 a share instead of $0.90. The new annual rate of $4.00 yields a high 4.8%. The bank also plans to buy back up to 2% of its shares over the next year. Share buybacks reduce the number of shares outstanding. That boosts earnings per share since profit is divided among fewer shares. The improved per-share ratio makes the stock more attractive to investors, which further spurs the share price. Meantime, Bank of Nova Scotia continues to reduce its loan-loss provisions as the pandemic eases and the economy re-opens. Demand for new loans, including home mortgages and business loans,…