A customer walks out of a Canadian Western Bank branch in Calgary, Alberta June 9, 2009.Todd Korol/Reuters
Canadian Western Bank has cited the impact of an earlier tax recovery among reasons for a 4-per-cent dip in its third-quarter earnings.
The Alberta-based bank on Friday reported profit of $44.7-million or $0.52 per diluted share in the three months ended July 31, compared with $46.6-million or $0.59 in the same prior-year period.
The bank said the drop in earnings reflected the impact of a $7.5- million tax recovery recognized in the third quarter of 2010 as well as the issuance of 8.1 million common shares upon the exercise of warrants.
Revenue in the three months ended July 31 rose to $120.3-million from $108.3-million in the fiscal 2010 period, prompted by a six per cent increase in loan growth, Canadian Western said.
Third-quarter net income for the banking and trust segment of $41.3-million was down 4 per cent from a year earlier, while net income before income taxes increased 13 per cent. Banking and trust segment total revenues were up 12 per cent on a tax-equivalent bases to a record $115.4-million.
Meanwhile, the insurance segment's net income of $3.4-million was down $200,000 from the record quarterly earnings reported a year earlier reflecting a lower contribution from the Alberta auto risk sharing pools and increased claims related to the May 2011 catastrophic wildfire in Slave Lake, Alta.
"Exceptional third-quarter loan growth supported by strong year-to-date contributions from all of our businesses has CWB Group on track to achieve another year of record results," president and chief executive Larry Pollock said in a release accompanying the results.
"Strong loan growth is apparent across all of our lending sectors and we are also seeing a further improvement in overall credit quality."
Mr. Pollock said the bank remains positive about the economic outlook, particularly over the long term, "but we are also cautious about potential spillover effects in our markets from global economic uncertainties and increased market volatility."