Coast Capital Savings Credit Union

Coast Capital Savings Credit Union

February 26, 2009 09:00 ET

Coast Capital Savings Announces Strong Results in Tough Economic Times

Credit Union maintains financial performance similar to record breaking year in 2007

SURREY, BRITISH COLUMBIA--(Marketwire - Feb. 26, 2009) - Coast Capital Savings announces that despite the unprecedented global financial crisis, their 2008 results remain strong. For the year ended December 31, 2008, the credit union's net income was $52.4 million with total assets under administration growing by 4.2 per cent to $12.3 billion. In addition, Coast Capital posted a net customer growth of 24,000 bringing its membership to 404,000.

Lloyd Craig, Coast Capital Savings' president and CEO, said the credit union is an industry leader in providing innovative, value-focused products. This along with planned and continuous improvement in the credit union's operating efficiency is allowing Coast Capital Savings to withstand the turbulent economic environment.

"There is no doubt that 2008 was one of the most challenging years in recent memory," Craig said. "We were able to maintain a competitive edge in the market by finding efficiencies and strengthening our processes to maintain our healthy returns."

Coast Capital Savings' performance by the numbers

The following are key financial highlights for 2008 versus 2007:

- Total on balance sheet assets increased from $9.9 billion to $10.4 billion

- Member equity increased from $430.4 million to $502.2 million

- Income before taxes was $72.3 million, up from $71.8 million

- Net income was $52.4 million, compared to $58.6 million

- Net interest income was $211.2 million, compared to $212.4 million

- Non-interest expenses decreased to $199.9 million from $204.0 million

- Capital adequacy ratio increased from 10.4 per cent to 11.0 per cent

- Operating efficiency improved from 72.2 per cent to 69.5 per cent

- Community contributions increased from $5.0 million to $5.1 million

Also of note in last year's results are two extraordinary expenses that were largely offset by gains achieved from the sale of residential mortgages. These expenses included:

- A corporate investment of $20.0 million in asset-backed commercial paper, representing 0.2 per cent of total assets, was written down by $8.3 million in addition to the $2.4 million write-down in 2007 and charged to other income.

- In keeping with the credit union's commitment to take prudent and proactive steps to prepare the institution to withstand the current economic environment, Coast Capital Savings increased its provisions for credit losses to $15.6 million for 2008. The actual loan write-offs for 2008 were $5.1 million.

"We are being realistic about the state of the economy," stated Craig. "Increasing our provisions for credit losses is a prudent measure that we, along with many other financial institutions, are taking to equip ourselves with the necessary loan reserves to stay strong."

Coast Capital Savings' focus in 2009 will be to continue introducing innovative products and services to consumers that differentiate the credit union in a highly competitive industry. The Free Chequing, Free Debit and More Account, introduced in 2005, remains the credit union's flagship product. New to the product line-up this year is Coast Capital Savings' High-interest, No-fee Savings Account that boasts one of the top rates in the country along with no minimum balance, monthly service charges, or access fees.

"Canadians have come to know Coast Capital Savings as the helpful financial service alternative," Craig continued. "Our brand promise is to provide simple financial help, and this will continue to assist our organization achieve the same level of success we have experienced over the past several years."

Coast Capital Savings is Canada's second largest credit union with total assets under administration of $12.3 billion, 404,000 members and 51 branches in the Metro Vancouver, Fraser Valley and Vancouver Island regions of British Columbia. Product innovations from Coast Capital Savings include Canada's first free chequing account from a full-service financial institution and the first business account in the country to offer unlimited transactions for a flat fee. The credit union was named one of BC's Top 50 Employers in 2009, holds Platinum status among Canada's 50 Best Managed Companies and is the recipient of the Canadian Co-operative Association Innovations in Co-operative Governance Award. Coast Capital Savings has also been designated a Caring Company by Imagine Canada. To learn more, visit www.coastcapitalsavings.com.



Financial Highlights
December 31 (in thousands of dollars)

2008 2007 2006 2005 2004 2003

Balance sheets:
Assets
Cash
resources 1,109,784 634,732 686,997 856,886 581,342 237,679
Investments 833,204 685,312 442,896 466,582 530,391 439,551
Loans 8,364,176 8,443,534 7,650,758 6,788,866 6,002,210 5,651,445
Premises and
equipment 38,791 37,521 41,124 44,027 37,682 42,729
Other 97,622 51,917 42,779 44,185 43,448 50,063
---------------------------------------------------------------
10,443,577 9,853,016 8,864,554 8,200,545 7,195,073 6,421,467
---------------------------------------------------------------
---------------------------------------------------------------

Liabilities
Deposits
Demand 2,106,670 1,860,717 1,710,791 1,637,178 1,432,172 1,329,413
Term 5,665,519 5,680,453 5,162,604 4,615,949 3,819,782 3,070,874
Registered 1,372,711 1,353,407 1,378,544 1,409,925 1,458,409 1,476,275
Class A
Shares 1,870 1,763 1,660 1,557 1,651 1,454
Accrued
interest 102,010 104,360 98,682 71,589 70,679 76,492
---------------------------------------------------------------
9,248,779 9,000,700 8,352,281 7,736,197 6,782,693 5,954,508
Borrowings 548,258 294,469 - - - 80,000
Other 80,712 63,599 76,353 70,558 61,140 76,841
---------------------------------------------------------------
9,877,749 9,358,768 8,428,634 7,806,755 6,843,833 6,111,349
---------------------------------------------------------------
Subordinated
notes 25,000 25,000 25,000 33,500 33,500 33,500
Class C
Shares 38,669 38,879 39,133 39,159 39,280 39,355
---------------------------------------------------------------

Members' equity
Class B Shares 43,669 44,464 44,954 45,840 48,855 50,859
Retained
Earnings 434,385 383,343 326,833 275,291 229,605 186,404
Accum. Other
Comprehensive
Income 24,104 2,562 - - - -
---------------------------------------------------------------
502,158 430,369 371,787 321,131 278,460 237,263
---------------------------------------------------------------
10,443,577 9,853,016 8,864,554 8,200,545 7,195,073 6,421,467
---------------------------------------------------------------
---------------------------------------------------------------

Income
statements:
Interest
income 504,855 518,387 447,644 357,329 334,511 337,969
Interest
expense 293,627 305,987 250,446 175,406 167,811 177,105
---------------------------------------------------------------
Net interest
income 211,228 212,400 197,198 181,923 166,700 160,864
Provision for
credit losses 15,568 6,812 6,966 6,532 7,228 8,937
---------------------------------------------------------------
195,660 205,588 190,232 175,391 159,472 151,927
Other income 76,599 70,145 70,366 66,349 68,964 66,595
---------------------------------------------------------------
272,259 275,733 260,598 241,740 228,436 218,522
Non-interest
expenses 199,931 203,951 196,642 184,744 184,989 175,116
---------------------------------------------------------------
Income before
undernoted 72,328 71,782 63,956 56,996 43,447 43,406
Unusual item - - - (983) 12,290 -
---------------------------------------------------------------
Income before
taxes 72,328 71,782 63,956 56,013 55,737 43,406
Income taxes 19,899 13,163 10,872 8,877 10,950 5,933
---------------------------------------------------------------
Net income 52,429 58,619 53,084 47,136 44,787 37,473
---------------------------------------------------------------
---------------------------------------------------------------

Financial
statistics
in percent:
Asset growth 5.91 11.24 8.10 13.97 12.05 5.92
Loan growth (0.94) 10.36 12.70 13.11 6.21 6.53
Deposit growth 2.76 7.76 7.96 14.06 13.91 6.21
Operating
efficiency 69.46 72.18 73.49 74.41 78.50 78.53
Capital ratio 11.00 10.39 10.26 10.80 11.12 11.38
Liquidity
ratio 19.83 14.20 13.53 17.11 16.39 11.22
---------------------------------------------------------------------------
Percentage
of average
assets
Net interest
income 2.22 2.36 2.41 2.52 2.52 2.57
Other income 0.80 0.78 0.86 0.92 1.04 1.06
Non-interest
expenses 2.10 2.26 2.40 2.56 2.80 2.80
---------------------------------------------------------------------------
Percentage
return on
Average
assets 0.55 0.65 0.65 0.65 0.68 0.60
Average
equity 11.39 14.86 15.52 15.72 17.68 17.38
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Branches 51 49 49 47 44 42
Insurance
Offices 36 35 35 33 26 25
Average
assets 9,516,198 9,015,087 8,192,880 7,228,653 6,606,497 6,259,735
Average
equity 460,250 394,403 342,084 299,795 253,324 215,646
Mutual funds
under admin-
istration 1,404,155 1,788,361 1,683,630 1,428,500 1,208,622 1,029,448
Securitized
loans 494,687 205,847 293,772 59,141 109,861 212,997
Total assets
under admin-
istration 12,342,419 11,847,224 10,841,956 9,688,186 8,513,556 7,663,912

Allowance
for credit
losses 53,645 42,516 37,793 32,815 27,823 23,303
Impaired loans 34,144 13,938 14,032 9,403 13,807 26,125
Loans written
off 5,129 3,312 2,618 2,744 3,144 3,352


Contact Information