Thanks Brian. I will begin on slide 8, which shows our key financial performance metrics for Q1 2018. The bank reported diluted earnings per share of $1.86 of 18% year-over-year. Included in our results is an employee benefit re-measurement credit resulting in 150 million of net income or $0.12 of diluted EPS.
Our core retail and commercial banking businesses reported double-digit earnings growth and global banking and markets delivered a strong recovery versus last quarter, up 16%. Revenue growth was up 3% from Q1 of last year or almost 6% adjusting to the impact of foreign currency translation and the impact of the sale of HollisWealth last year. Net interest income was up 8%, with strong growth in retail and commercial lending in Canada and internationally, as well as higher deposits. The core banking margin was up 6 basis points compared to last year. On an adjusted basis, non-interest revenues grew at a more modest pace and good fee and commission and insurance growth was partly offset by lower trading revenues and lower real estate and securities gains. Expenses were down 5% on reported basis, primarily due to the aforementioned benefits re-measurement credit. Adjusting further for the impact of foreign currency translation, the impact of the sale of HollisWealth last year expenses were up 3%. Higher investments in technology, digital banking, employee-related costs and professional fees were partly offset by continued cost reduction initiatives. The bank delivered strong positive operating leverage this quarter, further improving the bank’s productivity ratio. The credit of our portfolios remain stable, but the provision for credit loss or PCL ratio on impaired loans are 43 basis points versus 45 basis points last year. There was a modest net reversal provisions on performing loans of 20 million from improved credit quality and when combined with provisions on impaired loans resulting in a key sale ratio of 42 basis points. On slide 9, we provide the evolution of our common equity tier 1 capital ratio over the last quarter. The bank continues to maintain a strong capital position for the common equity tier 1 ratio of 11.25%. Internal capital generation contributed to roughly 30 basis points of capital improvement partly offset by strong organic business growth.
This quarter was also negatively impacted by the full transitional impacts of IFRS 9 of 14 basis points and an additional 10 basis points to the Basel I floor.
However, a new Basel II is effective in the second quarter, increasing our common equity tier one ratio by 50 basis points or to 11.75% on a pro forma basis. The CET-1 risk-weighted assets increased roughly 2% quarter-over-quarter or $6 billion.
Moving to slide 10 on IFRS 9, our current quarter of fiscal Q1 ’18 is based on IFRS 9, all prior period will not be stated that were based on IAS 39. The transition net reduction to equity was 610 million, and as I mentioned earlier the common equity tier one capital impact was negative 14 basis points. The Q1 total provision for credit losses included a net reversal of 20 million on performing loans also known as Stage I and Stage II due mainly to credit quality improvements in the Canadian Banking and Global Banking markets portfolios, primarily in commercial and corporate provisions. We saw minimal changes to our growth impaired loans, as a result of IFRS 9. And as part of transition to IFRS 9, certain allowances previously attributed to impaired retail loans are now attributed to performing retail loans.
Turning to the business line results beginning on slide 11, Canadian banking produced a strong quarter with net income of 1.1 billion, up 12% year-over-year. The results reflect strong asset growth, margin expansion, improved credit performance and positive operating leverage. Total revenues were up 4% from last year, driven by net interest income growth of 7% partly offset by the impact of the HollisWealth sale last year. Loans and acceptance increased 7% from last year. Residential mortgage growth was up 6% and business loans are up a strong 14%. Provision for credit losses on impaired loans improved 3 basis points year-over-year and was stable quarter-over-quarter. Expenses were well controlled and decreased 2% year-over-year. Higher investments in technology, digital and regulatory initiatives were more than offset by continued progress on our cost reduction initiatives and the impact of the HollisWealth sale last year. Canadian Banking delivered strong positive operating leverage, driving an improvement in the productivity ratio to 48.6%.
Turning to the next slide on international banking, earnings of 667 million in Q1 were up 16% year-over-year or 18% adjusting to the impact of foreign currency translation.
Our comments that follow on international banking are on a constant currency basis. Q1 results reflected strong asset and deposit growth, positive operating leverage and lower taxes. Revenues grew 7% with net interest income up 8% including a 12% increase in Latin America. Loans grew by 11% compared to a year ago, led by the Latin America region growing by 16%. The net interest margin of 4.66% was down 7 basis points year-over-year, mainly driven by changes in business mix. The margin was stable with the previous quarter. The loan loss ratio on impaired loans was up 4 basis points year-over-year.
Excluding acquisition related benefits last year, the underlined loan loss ratio on impaired loans improved versus both last year and the previous quarter. Expenses were up 3% as higher business volume growth, completion costs and increased technology and digital investments were partly offset by cost reduction initiatives. Operating leverage was strong a positive 4%, leading to an improvement in the productivity ratio.
Moving to slide 13, Global Banking and Markets; net income of 454 million was down 3% compared to last year, primarily due to the impact of foreign currency translation. Higher contributions from corporate banking, global equities and investment banking were offset by lower global fixed income. On a quarter-over-quarter basis, net income increased 16%, as markets were more constructive. All bank trading revenues on a tax equivalent basis nearly doubled Q4 ’17 levels, but were down 17% year-over-year. Revenues were down 2% year-over-year reflecting lower global fixed income and precious metals trading revenues.
However, net interest income was up 13% mainly from higher loan fees as well as higher deposit volumes and lending margins. The PCL ratio on impaired loans reflected a net reversal of 1 basis point, improvement of 5 basis points quarter-over-quarter and year-over-year. Expense growth was up 2% year-over-year driven by higher regulatory and technology cost probably offset by lower performance related and share based compensation and the positive impact of foreign currency translation. I’ll now turn to the other segment on slide 14 which incorporates results of good treasury, smaller operating units and certain corporate adjustments. The results include the net impact of assets and liability management activities.
The other segment reported a net income of 56 million this quarter. Earnings in this segment included the employee benefits re-measurement credit I referred to earlier. Partly offsetting were lower gains on investment securities and higher expenses. This completes my review of our financial results; I’ll now turn it over to Daniel, who will discuss risk management.