National Bank Financial Group earned $261 million in the second quarter, up from $241 million during the same period in 2009.
The Montreal-based bank said the profit amounted to $1.50 per diluted share for the quarter ended April 30, compared with a profit of $241 million, or $1.41 per share, a year ago, when it took a $20 million hit in after-tax charges related to asset-backed commercial paper.
The average analyst estimate was for earnings of $1.46 per diluted share, according to Thomson Reuters.
Revenue was $1.05 billion, up from $1.03 billion.
"In the second quarter of 2010, the personal and commercial segment excelled with a steadily increasing loan volume," said bank chief executive Louis Vachon.
"The results of financial markets were also up from the second quarter of 2009, which had benefitted from highly favourable market conditions."
The bank said earnings from its personal and commercial segment rose 23 per cent to $141 million for the quarter, fuelled by an increase in personal and commercial loans.
The bank also said it had $69 million of exposure to banking and sovereign risk in Portugal, Ireland, Italy, Spain and Greece, the European countries in greatest danger of defaulting in the ongoing debt crisis.
The bank has increased its loan sales force by 300 people, or 10 per cent, and credited that with increasing its lending to existing customers by eight per cent during the quarter.
The wealth management business earned $28 million in the quarter, down from $30 million a year ago, while National Bank's financial markets business earned $125 million, up $3 million from the same quarter of 2009.
The bank also said Friday it plans to expand beyond its Quebec base. But instead of opening new branches, it will focus on expanding upon footholds it already has, Vachon said.
The bank has increased its commercial lending by focusing on the oil and gas industry and specific industries in the agricultural sector, and it plans to explore other niches, Vachon said on a call discussing the company's results Friday.
"That's the more likely avenue of expansion for personal and commercial banking outside of Quebec right now than a full-fledged offensive to open up 200 branches right across Canada over the next 48 months," he said.