Bank of Nova Scotia (BNS.TO)

Likes the Canadian banks. (See Top Picks.)

ING purchase does not affect the stock. If you buy bank stocks for dividend you have to buy them when they are cheap. Dividend could go up just a little bit more before year end. You have to wait for pullbacks and he feels they will get one before year-end. A pull-back in the first half of next year also.

Buying ING Canada. They are making a statement that they want to be bigger. Now they have both discount brokers and discount bankers. What will be the return on the capital they are deploying. Only time will tell.

Just acquired ING Direct for $3.1 billion in cash. As a retail banker in Canada, they have been a laggard and this purchase puts them into #3 position so it is good for them that way. Doesn’t know how accretive this will be. ING’s customer base has really said they don’t want anything to do with big banks. Their success will be how much they can keep their hands off and let the current ING management do what they have been doing.

A lot of investors look at them with the one banks with international growth opportunities. This week’s result showed international was a bit weak. Dividend increase should bode well for investors but they have bumped up close to his target payout ration. The international exposure is key when you look at Canadian banks.

With a 5% gain in bank stocks plus the yield, you are looking at 9%-11% total return and he thinks the bank stocks are attractive.

(A Top Pick Aug 23/11. Up 6.51%.) Due to report soon and he expects a modestly positive quarter. Focus this quarter is going to be more on Canadian domestic banking so this bank will participate as much. Still likes.

Would you buy this stock going into earnings? Expect we should see the analysts’ expectations and company earnings aligned. Doesn’t expect there will be any negative or positive surprises. Likes this name but doesn’t see a ton of upside potential.

This is rumoured to be one of the lead buyers for ING Canada. It would be a good fit but the problem would be possible alienation of existing customers. Acquisitions outside of North America are one of their primary expansions. They don’t have a lot of competition and they have a good track record. Will possibly raise their dividends in December or March. 4.1% dividend yield. Can see it in the high $50s in 12 months.

He is not nearly as negative on financials as a lot of others. Cdn banks are trading at a bit of a premium compared to all the global banks and earnings growth is slowing down a little. However, dividends are safe and probably growing and earnings are growing single digit. This bank has done really well with its international diversification. Has gone more into wealth management as well. Great purchase in the low $50’s.

Trades around 11X earnings, which is in line with historical averages. 4.2% dividend yield with a projected growth rate in the dividend yield of 9% per year on a three-year basis. There are lots of other things that pay nice dividends.

One of the more attractive strategies. Well diversified internationally. Generally speaking numbers have been above expectations. Mortgage growth has been the driver and that is not going to be there as the housing market slows down. She only owns NA-T

This is his favourite bank right now. Canadian operations are very strong, very strong ROE, very good capital ratios and very efficient bank operations. Likes their international exposure.

(Top Pick Jun 8/11, Down 6.31%) For a long term income investor. Just added to his position.