ATB has approved $240M in deferred payments
ATB Financial has approved close to a quarter-billion dollars’ worth of mortgage, loan and credit card deferrals for Albertans since the start of the COVID-19 pandemic.
In an interview Friday, ATB CEO Curtis Stange said the $240 million in deferred payments the Crown corporation has approved for customers since March 18 illustrates just how devastating the pandemic has been for Albertans’ livelihoods.
“Behind $240 million of payments are Albertans. They’re Albertans that have borrowed money to buy homes, to buy boats, to live their lives, to usher kids off to school,” Stange said. “Behind each payment deferral is a person.”
The homegrown financial institution, which released its 2020 financial results Thursday, grew its revenues 2.6 per cent over the previous year to a record $1.7 billion. However, that growth was overshadowed by a 14 per cent increase in loan loss provisions (to $385 million) due to March’s double economic whammy of COVID -19 and the oil price crash.
Stange said ATB is well positioned to mitigate future loan losses. The financial institution saw its income before provisions hit a record of $519 million.
However, Stange acknowledged it will be a long road to recovery for Alberta, especially given the troubled state of the energy sector. He said ATB expects it will take three years to get back to PRE-COVID levels of economic activity.
“And there’s a scenario we are looking at that could take up to five years to get back to PRE-COVID GDP,” he said.
Stange, who said ATB provides financial services to approximately 25 per cent of the province’s small businesses, declined to provide a number when asked what proportion of Alberta’s retail outlets, restaurants and other mom-and-pop operations are vulnerable to failure due to COVID -19.
“We know there were a number of small businesses that were struggling prior to the pandemic,” he said. “And those challenges have been exacerbated.”
But he said ATB is committed to working closely with that sector to manage the crisis, just as it is committed to working with the energy sector. In its annual report, ATB said it anticipates energy sector capital spending and investment to remain minimal well into 2021, if not longer, and acknowledged there is concern that numerous energy sector businesses will not survive the downturn even if additional federal government support is forthcoming.
Stange said there have been recent high-profile examples of capital flight from Alberta’s energy sector, but he said ATB is proud of the energy sector’s environmental record and recognizes its contributions to the province’s GDP. “We just want to signal broadly to Albertans and our energy customers that we are here to support you.”