TORONTO — Scotiabank (TSX:BNS) says its third-quarter profits rose 14 per cent to nearly $1.1 billion, even as its capital markets division was hit by the same earnings decline experienced at other Canadian banks.

Canada's most international bank said net income was the equivalent to cash earnings of 99 cents per share -- missing analyst estimates by a penny, according to Thomson Reuters. That compared to $931 million in profits a year ago.

Total revenue was relatively flat at $3.78 billion, an increase of $11 million.

Shares of the bank were down 15 cents to $51.75 in early Tuesday trading on the Toronto Stock Exchange.

Earnings in the capital markets division tumbled 35 per cent to $305 million in the period as the bank faced a decline in revenues from the trading operations.

Skittish investors have kept stock market trading restrained in recent months as economic uncertainty -- particularly in Europe -- wore down their confidence and often left returns at a minimum.

The slowdown has impacted the capital markets divisions of other major Canadian banks including Bank of Montreal (TSX:BMO), CIBC (TSX:CM) and Royal Bank (TSX:RY).

"Scotia Capital delivered a solid quarter, notwithstanding a decline in trading revenues, as expected, from the records set in previous quarters," chief executive officer Rick Waugh said in a release.

"Corporate lending revenues were negatively impacted by lower lending volumes, in part due to slower than expected merger and acquisition activities."

In its Canadian banking business, Scotiabank reported a 21 per cent increase in net income to $604 million from $500 million a year ago.

The international banking division's profits rose two per cent to $317 million -- up $5 million over last year -- with the stronger loonie impacting the results.

Provision for credit losses were reduced to $276 million, down from $554 million from the same time last year.

"Lower than forecast provisions largely offset greater than anticipated weakness in trading revenues," wrote Barclays Capital analyst John Aiken in a note.

"While better than some of the results reported by its peers, we would be surprised if today's earnings received more than a lukewarm reception."

The bank says its quarterly dividend will remain unchanged at 49 cents per common share.

Scotiabank has about 68,000 employees across its international operations, which are based in about 50 countries. The bank estimates is has about 14.6 million customers.