DBRS Confirms Canadian Western Bank Rating at A (low), Stable Trend

DBRS has today confirmed Canadian Western Bank’s (CWB or the Bank) Issuer Rating and Deposits & Senior Debt rating of A (low), Short-Term Instruments rating of R-1 (low), Subordinated Debt rating of BBB (high) and its Non-Cumulative Preferred Shares rating of Pfd-3 (high). All trends remain Stable.

CWB’s most important strengths are its strong asset quality as evidenced by its very long history of low write-off rates, its proven niche strategy using relationship-based lending, its low cost base (partially due to business mix) and its strong internal capital generation. Additionally, funding diversification has improved over the past several years. CWB recently recorded its 101st consecutive profitable quarter.

Challenges remain, including concentration in the loan book, both geographically (Alberta and British Columbia) and by industry (commercial, construction and real estate lending), although the secured nature of the loan book and low write-off rates suggest this issue has been well managed throughout the Bank’s history.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

The applicable methodologies are Global Methodology for Rating Banks and Banking Organisations (June 2012), DBRS Criteria: Rating Bank Preferred Shares and Equivalent Hybrids (June 2009) and DBRS Criteria: Intrinsic and Support Assessments (February 2009), which can be found on our website under Methodologies.

The sources of information used for this rating include information provided by Canadian Western Bank and the Office of the Superintendent of Financial Institutions Canada. DBRS considers the information available to it for the purposes of providing this rating was of satisfactory quality.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.