EDMONTON, May 3, 2016 – Canadian Western Bank (TSX: CWB) today announced updated expectations for its second quarter fiscal 2016 provision for credit losses. In view of the weak oil price environment and borrowing base redeterminations that reflect current information, CWB has recorded approximately $33 million of second quarter provisions for credit losses on the oil and gas production portfolio. CWB now expects the consolidated second quarter provision for credit losses to be approximately $40 million.
“This unusual level of provisioning directly reflects the current impact of persistent low energy prices on our oil and gas production clients. Our capital ratios are strong, and outside of this portfolio credit quality is consistent with our prior expectations,” said Chris Fowler, President and CEO. “We previously indicated that we expected our fiscal 2016 annual provision for credit losses to be at the high end of a range between 18 and 23 basis points as a percentage of average loans. We now expect the annual provision to fall in a range between 35 and 45 basis points. We will provide a complete discussion of CWB’s year-to-date results and update our expectations for full year financial performance when we report our 112th consecutive profitable quarter on June 2nd.”
The outlook information provided today is a preliminary estimate only, is subject to completion of our quarterly financial close processes and has not been reviewed by CWB’s auditors. Second quarter fiscal 2016 financial results will be reported prior to market open on June 2nd, and management will host a webcast and conference call at 2:00pm ET on that day. Details will be posted to www.cwb.com/investor-relations.
Caution Regarding Forward-looking Statements
From time to time, CWB makes written and verbal forward-looking statements. Statements of this type are included in the Annual Report and reports to shareholders and may be included in filings with Canadian securities regulators or in other communications such as press releases and corporate presentations. Forward-looking statements include, but are not limited to, statements about CWB’s objectives and strategies, targeted and expected financial results and the outlook for CWB’s businesses or for the Canadian economy. Forward-looking statements are typically identified by the words “believe”, “expect”, “anticipate”, “intend”, “estimate”, “may increase”, “may impact”, “goal”, “focus”, “potential”, “proposed” and other similar expressions, or future or conditional verbs such as “will”, “should”, “would” and “could”.
By their very nature, forward-looking statements involve numerous assumptions and are subject to inherent risks and uncertainties, which give rise to the possibility that management’s predictions, forecasts, projections, expectations and conclusions will not prove to be accurate, that its assumptions may not be correct and that its strategic goals will not be achieved.
A variety of factors, many of which are beyond CWB’s control, may cause actual results to differ materially from the expectations expressed in the forward-looking statements. These factors include, but are not limited to, general business and economic conditions in Canada, including the volatility and level of liquidity in financial markets, fluctuations in interest rates and currency values, the volatility and level of various commodity prices, changes in monetary policy, changes in economic and political conditions, legislative and regulatory developments, legal developments, the level of competition, the occurrence of natural catastrophes, changes in accounting standards and policies, the accuracy and completeness of information CWB receives about customers and counterparties, the ability to attract and retain key personnel, the ability to complete and integrate acquisitions, reliance on third parties to provide components of business infrastructure, changes in tax laws, technological developments, unexpected changes in consumer spending and saving habits, timely development and introduction of new products, and management’s ability to anticipate and manage the risks associated with these factors. It is important to note that the preceding list is not exhaustive of possible factors.
Additional information about these factors can be found in the Risk Management section of CWB’s annual Management’s Discussion and Analysis (MD&A). These and other factors should be considered carefully, and readers are cautioned not to place undue reliance on these forward-looking statements as a number of important factors could cause CWB’s actual results to differ materially from the expectations expressed in such forward-looking statements. Unless required by securities law, CWB does not undertake to update any forward-looking statement, whether written or verbal, that may be made from time to time by it or on its behalf.
For further information contact:
Matt Evans, CFA
AVP, Investor Relations
Canadian Western Bank
Phone: (780) 969-8337
Email: [email protected]