Capital to support ongoing strong growth
EDMONTON, June 16, 2016 – Canadian Western Bank (TSX: CWB) (“CWB”) announced today that it has entered into an agreement with a syndicate of underwriters led by BMO Capital Markets and National Bank Financial Inc., (collectively, the “Underwriters”) pursuant to which the Underwriters have agreed to purchase, on a bought deal basis, an aggregate of 5,105,000 common shares (the “Shares”) from CWB at a price of $24.50 per Share, for gross proceeds of approximately $125 million (the “Offering”). CWB has also granted the Underwriters an option, exercisable, in whole or in part, at any time until and including 30 days following the closing date of the Offering, to purchase up to an additional 765,750 Shares at the Offering price, to cover over-allocations, if any, and for market stabilization purposes. Should the Underwriters choose to exercise this option in full, the maximum gross proceeds raised under the Offering will be $144 million.
The net proceeds of the Offering will be added to CWB’s capital base and will be used for general corporate purposes.
“With very strong organic loan growth through the first half of fiscal 2016, as well as the recent acquisition of CWB Maxium, the forthcoming addition of CWB Franchise Finance and the successful launch of our new core banking system, we continue to build on CWB’s established commercial banking strategy,” said Chris Fowler, President and CEO. “This equity issue will support further profitable growth and provide flexibility as we continue to deliver our unique brand of targeted financial services and expand our client relationships across the country.”
CWB’s Common Equity Tier 1 ratio was 8.2% as of April 30, 2016. CWB estimates that its Common Equity Tier 1 ratio would be approximately 8.8% as at April 30, 2016 after giving effect to the Offering (and without taking into account any exercise of the over-allotment option). The CWB Franchise Finance portfolio purchase is expected to reduce CWB’s Common Equity Tier 1 ratio by approximately 15 basis points when it closes in the third quarter.
CWB intends to file a short form prospectus in respect of the Offering with the applicable securities regulatory authorities in all provinces and territories of Canada. Details of the Offering will be set out in the short form prospectus which will be available on SEDAR at www.sedar.com. The offering is expected to close on or about July 7, 2016 and is subject to CWB receiving all necessary regulatory approvals.
The Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or under any state securities laws, and may not be offered, sold, directly or indirectly, or delivered within the United States of America and its territories and possessions or to, or for the account or benefit of, United States persons except in certain transactions exempt from the registration requirements of such Act and applicable state securities laws. This press release shall not constitute an offer to sell or a solicitation of an offer to buy securities in the United States.
Caution Regarding Forward-Looking Statements
Certain information contained herein constitutes forward-looking information under applicable securities laws. Forward-looking statements in this news release include, but are not limited to, statements with respect to the timing of completion and size of the Offering of the Shares and the use of proceeds of the Offering. These statements are based on current expectations and are inherently subject to significant risks, uncertainties and changes in circumstances, many of which are beyond the control of CWB. These risks include, but are not limited to, the failure or delay in satisfying any of the conditions to the completion of the offering. Except as required by law, CWB does not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time, by it or on its behalf. The forward-looking information contained in this press release is presented for the purpose of interpreting the information contained herein and may not be appropriate for other purposes.
For Further Information Contact:
Matt Evans, CFA
AVP, Investor Relations
Canadian Western Bank
Phone: (780) 969-8337
Email: [email protected]