The ratings on The Bank of Nova Scotia (Scotiabank) reflect its market position as one of five dominant universal banks in Canada, its broad business mix, geographic diversification, the efficiencies of its operations, and the high returns that it generates from its international operations. The bank has a track record of generating strong and consistent earnings performance and has a solid capital base even when adjusting for higher risk activities. These strengths are offset somewhat by the higher risk profile of Scotiabank's corporate lending activities and its investments in international banking subsidiaries. With the bank's continued success in the international arena, its earnings base is now almost equally divided between its three primary operating divisions: domestic, international, and Scotia Capital.
