Central 1 Credit Union Reports First Quarter Profit of $20.6 Million

VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 29, 2014) - Central 1 Credit Union (Central 1) announced today it posted a first quarter profit of $20.6 million for the period ended March 31, 2014, down 3.4 per cent from $21.4 million in the same period a year ago.

Central 1 had realized gains of $15.1 million and unrealized gains of $4.9 million, resulting in a net gain of $20.0 million during the first quarter, compared to a net gain of $21.8 million the previous year.

Interest margin for the quarter was $7.5 million, down from $7.8 million for the first three months of last year. The overall liquidity of Central 1's investments has improved over the past year as Central 1 has continued to reduce risk in the portfolio.

First quarter highlights compared to the same period last year:

• Net financial income was $27.5 million, compared to $29.6 million in 2013.
• Return on equity was 9.4 per cent, compared to 10.6 per cent.
• Assets at the end of the quarter were $12.4 billion, down 14.5 per cent from $14.5 billion.
• Operating expenses decreased by $1.8 million to $31.3 million.
• Other income was $27.6 million, an increase of $0.2 million over the same period last year.

The asset decline primarily reflects the maturing of historical securitization obligations entered into prior to 2010.

Central 1's capital ratios remain strong. At the end of the quarter, Central 1's borrowing multiple for federal capital adequacy purposes was 12.8:1, while its percentage of regulatory capital to risk weighted assets for provincial capital adequacy purposes was at 44.4 per cent.

In a significant development during the first quarter, the Financial Institutions Commission of British Columbia (FICOM) designated Central 1 as a domestic systemically important financial institution (D-SIFI) within the Canadian credit union system.

B.C. and Ontario credit union systems

At the end of the first quarter, assets of the B.C. system were $59.4 billion, up 3.5 per cent from $57.4 billion a year ago.

Asset growth was mainly in personal mortgages, which grew by 3.3 per cent, and commercial mortgages, which were up by 5.9 per cent. Deposit growth was mainly in nonregistered demand deposits, which increased 7.6 per cent.

Assets of the Ontario credit unions that are members of Central 1 were $33.3 billion, up 6.6 per cent from $31.3 billion. Asset growth was mainly in residential mortgages, up by 10.4 per cent from a year ago, and in commercial mortgages and loans, which increased 11.1 per cent.

Central 1's First Quarter 2014 Report has been filed with SEDAR and is posted on www.central1.com and www.sedar.com.

About Central 1

Central 1 is the central financial facility and trade association for the B.C. and Ontario credit union systems. Owned primarily by its member credit unions, 43 in B.C. and 90 in Ontario, Central 1 represents a consumer-oriented, full-service retail financial system that serves 3.2 million members and collectively holds more than $92 billion in assets.

With offices in Vancouver, Mississauga and Toronto, Central 1 provides liquidity management, direct banking and payment service solutions as well as a wide range of trade services. For more information, visit www.central1.com.