Laurentian Bank of Canada today reported a 33% jump in third quarter net income due in part to a gain on the sale of Montreal Exchange shares.

The Montreal-based bank said net income for the quarter ended July 31 was $30.9 million, or $1.17 a share, compared to $23.2 million, or $85¢ a share, for the same period in 2007.

Return on common shareholders’ equity — a key measure of profitability — was 13.4% for the quarter, up from 10.5% for the same period in 2007.

The provision for credit losses stood at $18.5 million.

Total revenue stood at $171.1 million for the third quarter, compared to $151.0 million for the third quarter of 2007.

Laurentian said results for the third quarter of 2008 include a net gain on sale of securities of $7.6 million stemming from a $12.9 million gain on the sale of Montreal Exchange shares, partially offset by losses of $5.3 million on the sale of other securities.

The provision for credit losses includes an $8 million increase in the general allowance for loan losses.

Excluding these significant items, net income for the third quarter of 2008 improved $5.8 million, or 25%, and diluted net income per common share rose by 24¢, or 28%, compared to results achieved in the third quarter of 2007, which included no significant items.

“All our business segments improved their performance year-over-year and contributed to our growth. However, the recent slowdown of the Canadian economy combined with our strong loan growth have led us to prudently increase our general provision for loan losses,” stated Réjean Robitaille, president and CEO, in a release.

“In view of our solid financial condition, added Mr. Robitaille, and of our confidence in our ability to pursue the Bank’s development, the Board of Directors decided to increase our dividend on common shares by 2¢ per quarter.” The hike amounts to a 6% increase.

On a sector basis, the retail & SME Quebec business segment’s contribution to net income improved by 11%, reaching $11.6 million for the third quarter of 2008, compared to $10.4 million for the third quarter of 2007.

The real estate & commercial business segment’s contribution to net income improved 42% to reach $7.7 million for the third quarter of 2008, compared to $5.4 million for the third quarter of 2007.

The B2B Trust business segment’s contribution to net income improved 14%, reaching $9.2 million for the third quarter of 2008, compared with $8.1 million for the third quarter of 2007.

The Laurentian Bank Securities (LBS) business segment’s contribution to net income improved 91%, reaching $1.1 million for the third quarter of 2008,
compared with $0.6 million for the third quarter of 2007.

“Results for the third quarter of 2008 were significantly better as a result of a very strong performance of the institutional fixed income division,” the bank said.