Q: Does BNS still have a good exposure to Central and South America ? How much and in what areas ? Is it still one of your preferred Cdn banks ? Than you.
5i Research Answer:
We still like BNS and think BNS offers an attractive risk/reward compared to other Canadian banks, at only 8X earnings. That being said, it has been disappointing so far. In a rate pivot we would expect its Latin American exposure to help earnings. Last year it broke down exposure as follows (via revenue): Latin America $4.8B, Mexico $2.5B, Caribeean and Central America $2.2B, 'other' $4.0B. This compares with Canada revenue at $18.0B.