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Scotiabank names Brian Porter as president; Rick Waugh remains as CEO

The Canadian Press

TORONTO - Scotiabank (TSX:BNS) has promoted Brian Porter to president of the bank in a move that at least one analyst believes positions the former head of international banking as next in line for the bank's top job.

Porter takes over Thursday as the bank's president from Rick Waugh, who will continue his role as chief executive officer.

Desjardins Securities analyst Michael Goldberg noted that Waugh turns 65 in December and that using past succession patterns at the bank as a guide, "Porter also appears set to become CEO when Mr. Waugh steps down."

"We view these developments as neutral to the outlook for Scotia," Goldberg said.

"They represent continuity with respect to succession, strategy and a continued focus on developing strong diversified franchises that can continue to generate relatively steady earnings and dividend growth. As far as we can see, this means BNS should continue to be the Bank of No Surprises."

In an interview, Porter said he wouldn't speculate on whether his appointment is a precursor to eventually taking the reins from Waugh, nor would he say if he would be interested in stepping into the lucrative CEO role that earned Waugh roughly $10.6 million in 2011.

"Executive appointments at the bank are at the behest of the board of directors and they're going to make those determinations when they deem it's appropriate."

Scotiabank is Canada's most international bank and, as group head for international banking, Porter oversaw all of its personal, small business and commercial banking operations in more than 55 countries outside of Canada.

But Porter said his international banking experience doesn't signal that Scotia's focus will turn any further toward the international side, despite expectations of more challenging growth ahead in domestic banking.

"We're not going to tilt it one way or the other," he said.

"It's to be expected that you see some moderation in growth in Canada given the low interest rate environment and the asset growth that all Canadian banks have enjoyed in Canada," he said, adding that the bank is comfortable with its asset mix and its Canadian risk portfolio.

In fact, the bank's latest acquisition move — among more than 20 it has made since the financial crisis — has been to scoop up the Canadian operations of ING for more than $3 billion in order to stake out a bigger share of the Canadian consumer market.

Following that big acquisition in August, Porter said the bank is focused on the assets it already has rather than seeking out new targets.

"Buying something is the easy part, integrating it and executing on the acquisition is the more difficult part," he said.

"We've got a lot on our plate in terms of what we've acquired... we're comfortable with our organic growth profile going forward, we will opportunistically look at acquisitions, but we don't need them."

With assets of $670 billion and more than 81,000 employees, Scotiabank and its affiliates provide services to some 19 million customers around the world.

Porter, who joined the bank in 1981, had previously served for five years as Scotiabank's chief risk officer and has held a variety of management positions, including wholesale, international personal and commercial banking and global risk management, the bank said in a statement.

"I am extremely pleased to welcome Brian to the role of president," Waugh said. "He has had a distinguished and diversified career at Scotiabank and he brings the right amount of breadth and depth to the role."

Dieter Jentsch, executive vice-president responsible for Latin American operations and a Scotiabank employee since 1983, has been appointed to succeed Porter as head of international banking.

Scotia shares were up 11 cents to close at $54.25 Wednesday on the Toronto Stock Exchange.