Credit Union Central of British Columbia

Credit Union Central of British Columbia

March 12, 2008 12:30 ET

Credit Union Central's Earnings at All-Time High

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 12, 2008) - Credit Union Central of British Columbia posted record net income of $24.4 million in 2007.

Net income was up 47 per cent from $16.6 million in 2006. Central's previous best year was 2003, when its net income was $17.7 million.

Financial margin of $31.1 million was also at a record level, rising 20.5 per cent from the previous high of $25.8 million set in 2006.

The central financial facility for the B.C. credit union system reported asset growth of 9.4 per cent over 2006, with total assets at year-end reaching $5.66 billion.

Based on these results, Central paid a dividend of 8.34 per cent, maintaining its policy of paying a dividend equivalent to twice the average 90-day Treasury Bill rate for the year.

After taxes and dividends, $17.7 million was transferred to retained earnings, which stood at $167.1 million at year-end.

"This marks Central's best financial performance on record," says Rowland Kelly, Central's Vice-President, Finance, and Chief Financial Officer. "More important, Central fulfilled its primary role of providing liquidity to credit unions during a very challenging year in the financial markets."

Credit union borrowings from Central rose to $1.41 billion at year-end, as credit unions continued to use Central as their primary source of borrowed liquidity to meet their members' demand for mortgage loans in a strong housing market. Central also facilitated credit union access to liquidity through Canada Mortgage and Housing Corporation's Canada Mortgage Bond program, with credit unions selling $972 million in assets through this program.

Aiding Central's role as the system's financial facility were continued strong ratings from credit rating agencies. Standard & Poor's confirmed Central's ratings of A-1 for short-term debt and A+ for senior long-term debt, while Dominion Bond Rating Service maintained its ratings of Central at R-1 (Mid) and A (High), respectively.

Central's net income was boosted by $4.3 million from the sale of commercial rental properties.

Reflecting the lack of a market for non-bank asset-backed commercial paper (ABCP), Central wrote down its investment of $23 million in non-bank ABCP by $2.9 million.

The year also saw some key organizational developments for Central.

On Dec. 3, Don Rolfe was appointed as Central's President and Chief Executive Officer, effective Feb. 15, 2008.

On June 22, Credit Union Central of Ontario's members approved the merger of CUCO with Central. On the same day, Central's members approved amendments to Central's constitution and rules to pave the way for the combination of the two organizations. The closing of the combination was delayed, owing to problems in determining the relative value of each central's holdings of non-bank ABCP, and the merger now is expected to take effect by July 1 this year.

Credit Union Central of British Columbia is the central banking facility and trade association for the province's 48 independent credit unions, managing a liquidity pool of $3.8 billion. From its office in Vancouver, B.C., Central's 350 employees provide a wide range of services to credit unions and corporate clients, ranging from payments settlement and liquidity management to Internet banking and trade association functions.

Contact Information

  • Credit Union Central of British Columbia
    Ian Smith
    Director of Communications
    (604) 730-6348