Pacific & Western Credit Corp. Announces Record Quarterly Net Earnings

LONDON, ON, March 4 /CNW/ FIRST QUARTER FINANCIAL HIGHLIGHTS

• Net earnings of $1.9 million or $0.14 per share ($0.13 diluted) compared to $1.6 million or $0.12 ($0.12 diluted) per share for the previous quarter and approximately $1 million or $0.07 per share ($0.07 diluted) for the same period a year ago
• Total assets increased by $14 million from the end of the previous quarter to $1.03 billion and increased by $228 million from a year ago
• Lending assets increased to $662 million, an increase of $105 million from a year ago and down slightly from the previous quarter's figure of $664 million
• Provision for credit losses showed a net recovery of $337,000 compared to a net recovery of $749,000 in the previous quarter and a provision of $36,000 for the same period a year ago
• Total revenue (teb) increased to $5.2 million for the quarter compared to $4.9 million in the previous quarter and $3.4 million for the same period a year ago
• Other income of $924,000 compared to 67,000 for the previous quarter and $48,000 for the same period a year ago
• Efficiency ratio (teb) improved to 43.8% for the quarter compared to 59.5% for the previous quarter and 52.85% for the same period a year ago
• Return on average common shareholders' equity improved to 16.8% for the first quarter compared to 15.5% for the previous quarter and 10.6% for the same period a year ago
• Credit quality remained strong with gross impaired loans equal to 0.13% of total assets compared to 0.12% at the end of the previous quarter and 0.27% a year ago

PRESIDENT'S COMMENTS This quarter marks the tenth quarter since our wholly owned subsidiary, Pacific & Western Bank of Canada, obtained its Schedule 1 Bank Charter. Since that time our assets have grown as well as our profits. The results for this quarter are particularly strong. Net earnings grew to $2.6 million (before draw down of the future income tax asset) and $1.9 million after draw-down of the future income tax asset. This gave rise to return on average common equity of 23.4% and 16.8% respectively. Our efficiency ratio (teb) for the quarter was 43.8%. Our asset quality ratio (gross impaired loans divided by assets) was 0.13%. Non-interest expenses as a percent of assets was 0.21% and our employee to asset ratio was $23.4 million. These ratios indicate that we are one of Canada's most profitable and efficient banks. We are continuing to experience high demand for our products and this quarter we booked new loans and leases of $81 million, just slightly less than our target for the quarter. Scheduled loan and lease repayments, however, for the quarter were $83 million so that our lending assets decreased slightly from $664 million to $662 million. Throughout the remaining quarters, we expect to book new loans and leases in the amount of approximately $1 million per calendar day and after taking into consideration scheduled loan repayments, we expect lending assets to increase to approximately $880 million. At the end of this quarter, we had loans and leases offered and accepted by our clients totalling $137 million. We have also been working on several new, exciting initiatives that take advantage of our Bank's in-house systems capabilities to provide high-volume financing to some of Canada's most credit-worthy corporations. We look forward to expanding our high quality service to niche markets in Canada and continued growth in earnings and returns to our shareholders.