Bank of Nova Scotia today announced plans to buy back up to 50 million of its shares in 2006, about 5%of its common stock.

The bank said it will pay market prices and cancel any shares purchased, primarily to offset dilution resulting from stock option exercises over the year.

Purchases under the normal course issuer bid will begin as early as Jan. 6 and end no later than Jan. 5, 2007.

The bank purchased 23.9 million shares over the past 12 months at an average price of $41.47 each under its previous normal course issuer bid.