Canadian Western Bank
TSX : CWB
TSX : CWB.PR.B

Canadian Western Bank

March 03, 2015 16:50 ET

CWB Announces the Strategic Sale of Valiant Trust Company Assets

EDMONTON, ALBERTA--(Marketwired - March 3, 2015) - Canadian Western Bank (TSX:CWB)(TSX:CWB.PR.B) today announced it has entered into a definitive agreement (the "Agreement") with Computershare Limited ("Computershare") (ASX:CPU) to sell, subject to terms and conditions of the Agreement, certain assets of CWB's subsidiary, Valiant Trust Company (Valiant), for maximum cash proceeds of $33 million. Assets to be purchased by Computershare relate to Valiant's current business in stock transfer, corporate trust and employee plan services. Revenue contributions from this business represented approximately one percent of CWB's total revenues for the year ended October 31, 2014. The sale is subject to customary closing conditions, including regulatory approval. The closing date is expected in early May 2015.

"This deal resulted from a purposeful strategic assessment that started over a year ago, and is supported by similar rationale to that of our recently announced agreement to sell Canadian Direct Insurance," said Chris Fowler, CWB's president and chief executive officer. "While the product lines offered by Valiant have provided solid contributions to our trust services offerings, our ability to profitably grow the stock transfer business was challenged in the face of ongoing industry consolidation and technology investment required to meet evolving client needs for these types of services. We're confident that the deployment of capital from this sale into our faster growing and more strategically aligned core businesses will generate superior returns for CWB shareholders moving forward."

"The transaction was facilitated through a competitive process, and Computershare's reputation and position as a leader in their field gave us confidence that we could facilitate a smooth transition for both the employees and clients of Valiant," continued Mr. Fowler. "We expect Valiant staff will continue to serve the needs of clients and their stakeholders in the same responsive way they always have, but with a more comprehensive suite of services and capabilities that will be offered under Computershare's ownership."

Stuart Swartz, CEO of Computershare Canada, added: "We're very pleased to be extending our core businesses across Canada and look forward to welcoming Valiant's clients and employees to Computershare. Our ability to add value to this business given the alignment with our core competencies provides tremendous opportunities for all Valiant clients and their stakeholders."

Blair Franklin Capital Partners Inc. is acting as exclusive financial advisor to CWB.

CWB looks forward to dissemination of its first quarter financial results news release after the market closes on March 4, 2015. CWB's executives will comment on financial performance and strategy, including this transaction, and respond to questions from analysts and institutional investors during the first quarter results conference call scheduled for Thursday, March 5, 2015 at 2:00 p.m. ET (12:00 p.m. MT). The conference call may be accessed on a listen-only basis by dialing 647-788-4922 or toll-free 1-877-223-4471. The call will also be webcast live on CWB's website at www.cwb.com.

About CWB Group

Canadian Western Bank (TSX:CWB) offers a full range of business and personal banking services across the four western provinces and is the largest publicly traded Canadian bank headquartered in Western Canada. The Bank, along with its operating affiliates, National Leasing Group, Canadian Western Trust, Valiant Trust, Canadian Direct Insurance, Canadian Western Financial, Adroit Investment Management, and McLean & Partners Wealth Management, collectively offer a diversified range of financial services across Canada and are together known as the CWB Group. The common shares of Canadian Western Bank are listed on the Toronto Stock Exchange under the trading symbol "CWB". CWB's Series 5 Preferred Shares trade on the Toronto Stock Exchange under the trading symbol "CWB.PR.B". Refer to www.cwb.com for additional information.

About Computershare Limited

Computershare (ASX:CPU) is a global market leader in transfer agency and share registration, employee equity plans, proxy solicitation and stakeholder communications. We also specialize in corporate trust, mortgage, bankruptcy, class action, utility and tax voucher administration, and a range of other diversified financial and governance services. Founded in 1978, Computershare is renowned for its expertise in high integrity data management, high volume transaction processing and reconciliations, payments and stakeholder engagement. Many of the world's leading organizations use us to streamline and maximize the value of relationships with their investors, employees, creditors and customers. Computershare is represented in all major financial markets and has over 15,000 employees worldwide. For more information, visit www.computershare.com.

Forward-looking Statements

From time to time, CWB makes written and verbal forward-looking statements. Statements of this type are included in the Annual Report and reports to shareholders and may be included in filings with Canadian securities regulators or in other communications such as press releases and corporate presentations. Forward-looking statements include, but are not limited to, statements about CWB's objectives and strategies, targeted and expected financial results and the outlook for CWB's businesses or for the Canadian or U.S. economy. Forward-looking statements are typically identified by the words "believe", "expect", "anticipate", "intend", "estimate", "may increase", "may impact" and other similar expressions, or future or conditional verbs such as "will", "should", "would" and "could."

By their very nature, forward-looking statements involve numerous assumptions. A variety of factors, many of which are beyond CWB's control, may cause actual results to differ materially from the expectations expressed in the forward-looking statements. These factors include, but are not limited to, general business and economic conditions in Canada including the volatility and lack of liquidity in financial markets, fluctuations in interest rates and currency values, changes in monetary policy, changes in economic and political conditions, regulatory and legal developments, the level of competition in CWB's markets, the occurrence of weather-related and other natural catastrophes, changes in accounting standards and policies, the accuracy of and completeness of information CWB receives about customers and counterparties, the ability to attract and retain key personnel, the ability to complete and integrate acquisitions, reliance on third parties to provide components of CWB's business infrastructure, changes in tax laws, technological developments, unexpected changes in consumer spending and saving habits, timely development and introduction of new products, and management's ability to anticipate and manage the risks associated with these factors. It is important to note that the preceding list is not exhaustive of possible factors.

These and other factors should be considered carefully and readers are cautioned not to place undue reliance on these forward-looking statements as a number of important factors could cause CWB's actual results to differ materially from the expectations expressed in such forward looking statements. Unless required by securities law, CWB does not undertake to update any forward-looking statement, whether written or verbal, that may be made from time to time by it or on its behalf.

Assumptions about the performance of the Canadian economy in 2015 and how it will affect CWB's businesses are material factors considered when setting organizational objectives and targets. Performance target ranges for fiscal 2015 consider the following management assumptions:

  • Moderate economic growth in Canada and relatively stronger performance in the four western provinces;
  • A relatively stable net interest margin (teb) compared to the level achieved in the fourth quarter of 2014, primarily attributed to treasury management strategies and shifts in asset mix that help to offset impacts from the very low interest rate environment, a flat interest rate curve and competitive factors;
  • Sound credit quality with actual losses remaining within CWB's historical range of acceptable levels.

Potential risks that may have a material adverse impact on current economic expectations and forecasts include a sustained period of materially lower energy and other commodity prices compared to average levels observed in fiscal 2014, a slowing rate of economic growth in the U.S., a significant and sustained deterioration in Canadian residential real estate prices, or a significant disruption in major global economies. Greater than expected pricing competition and/or disruptions in domestic or global financial markets that meaningfully impact loan yields and/or funding costs may also contribute to adverse financial results compared to expectations.

Contact Information

  • Kirby Hill, CFA
    Vice President, Strategy & Communications
    Canadian Western Bank
    Phone: (780) 441-3770
    Email: kirby.hill@cwbank.com

    Matt Evans, CFA
    AVP, Investor Relations
    Canadian Western Bank
    Phone: (780) 969-8337
    Email: matt.evans@cwbank.com