Re­gional bank in­creases prof­its on higher rev­enue

Cana­dian West­ern earns $214.27-mil­lion in fis­cal 2017

Stockwatch Daily - - FRONT PAGE - Mr. Chris Fowler re­ports

CANA­DIAN WEST­ERN Bank has re­leased its fourth quar­ter and fis­cal 2017 fi­nan­cial re­sults.

“CWB’s strate­gic ex­e­cu­tion and fi­nan­cial per­for­mance in fis­cal 2017 were both very strong,” said Chris Fowler, pres­i­dent and chief ex­ec­u­tive of­fi­cer. “We main­tained our fo­cus on business own­ers while de­liv­er­ing growth across a broader geo­graphic foot­print with in­creased in­dus­try di­ver­si­fi­ca­tion. We also made sig­nif­i­cant progress toward the up­com­ing trans­for­ma­tion of our cap­i­tal man­age­ment pro­cesses, and worked to en­sure our on­go­ing tech­nol­ogy in­vest­ments and process im­prove­ments po­si­tion us to meet the rapid pace

of growth and change within our in­dus­try. Along­side this strong strate­gic ex­e­cu­tion, we de­liv­ered record to­tal rev­enues from core op­er­a­tions and record core pre­tax, pre­pro­vi­sion in­come, with this lat­ter met­ric ex­ceed­ing $100-mil­lion in back-to-back quar­ters for the first time. We also de­liv­ered higher net in­ter­est mar­gin in ev­ery quar­ter, pos­i­tive op­er­at­ing lever­age, strong credit qual­ity and in­creased our an­nual com­mon share div­i­dend for the 25th con­sec­u­tive year. To cap off the year, we an­nounced a highly strate­gic and ac­cre­tive ac­qui­si­tion of equip­ment loans and leases, and gen­eral com­mer­cial lend­ing as­sets. As we close fis­cal 2017, I want to thank our peo­ple for their pas­sion and com­mit­ment to help both our clients and CWB achieve our strate­gic goals. To­day, we have an in­cred­i­ble op­por­tu­nity to cre­ate ex­cep­tional client ex­pe­ri­ences for business own­ers across Canada. There is no doubt in my mind that CWB’s fu­ture looks more ex­cit­ing than ever be­fore. Thanks to our tremen­dous teams, I am very con­fi­dent in our abil­ity to achieve our full po­ten­tial to­gether.”

Fourth quar­ter fis­cal 2017 highlights (com­pared with the same pe­riod in the prior year):

• Very strong op­er­at­ing per­for­mance, with record core com­mon share­hold­ers’ net in­come of $61-mil­lion, up 27 per cent and record core pre­tax, pre­pro­vi­sion in­come (teb (tax­able equiv­a­lent ba­sis)) of $104-mil­lion, up 17 per cent’

• Di­luted and ad­justed cash earn­ings per com­mon share of 68 cents and 74 cents, up 26 per cent and 25 per cent, re­spec­tively;

• The gain on sale re­lated to the ap­point­ment of a suc­ces­sor trustee for Cana­dian West­ern Trust’s ex­empt mar­ket se­cu­ri­ties business con­tribut­ing six cents to ad­justed cash earn­ings per com­mon share;

• Record to­tal rev­enue (teb) from core op­er­a­tions of $196-mil­lion, up 16 per

cent with strong 14-per-cent growth of net in­ter­est in­come (teb);

• Net in­ter­est mar­gin (teb) of 2.64 per cent, up 28 ba­sis points from last year and four ba­sis points from last quar­ter;

• Pro­vi­sion for credit losses as a percentage of av­er­age loans of 20 ba­sis points, down from 24 ba­sis points last year and unchanged from pre­vi­ous quar­ter.

Full-year fis­cal 2017 highlights (com­pared with the prior year):

• Very strong op­er­at­ing per­for­mance with com­mon share­hold­ers’ net in­come of $214-mil­lion, up 21 per cent, and record core pre­tax, pre­pro­vi­sion in­come (teb) of $391-mil­lion, up 10 per cent;

• Di­luted and ad­justed cash earn­ings per com­mon share of $2.42 and $2.63, up 14 per cent and 16 per cent, re­spec­tively;

• Record to­tal rev­enue (teb) from core op­er­a­tions of $729-mil­lion, up 10 per cent, in­clud­ing 10-per-cent growth of net in­ter­est in­come (teb) and 16 per cent higher non-in­ter­est in­come;

• Pos­i­tive op­er­at­ing lever­age of 0.3 per cent;

• Loan growth of 6 per cent, with 11-per-cent growth out­side of Al­berta and 18-per-cent growth of non-Al­berta gen­eral com­mer­cial loans;

• Net in­ter­est mar­gin of 2.57 per cent, up 14 ba­sis points, with se­quen­tial in­creases in ev­ery quar­ter;

• Pro­vi­sion for credit losses as a percentage of av­er­age loans of 23 ba­sis points, down from 38 ba­sis points;

• Gross im­paired loans rep­re­sent­ing 0.72 per cent of to­tal loans, up from 0.58 per cent last year and down from 0.74 per cent last quar­ter;

• In­creased the bank’s an­nual com­mon share div­i­dend for the 25th con­sec­u­tive year.

(See CWB Ta­ble 1 on page 41)

We seek Safe Har­bor.

Erika Flores con­densed this news re­lease (erikaf@stock­watch.com). Albrecht Wilhelm Al­bert Bell­st­edt, An­drew John Bibby, Christo­pher Hec­tor Fowler, Linda Mar­garet Ow­erri Ho­hol, Robert Adrian Man­ning, Sarah A Morgan-Sil­vester, Mar­garet Jean Mul­li­gan, Robert Lawrence Phillips, Ray­mond Joseph Protti, Ian MacNevin Reid, Hugh San­ford Ri­ley, Alan Mac­Don­ald Rowe

(CWB) Shares: 88,494,353

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