CWBFG Annual Report 2021

Annual Report 2021

MOMENTUM

Our Aspiration To be the best full-

service bank for business owners in Canada

New Gateway Banking Centre, Edmonton, Alberta

TABLE OF CONTENTS

Performance Dashboard Message From President & CEO Message From Chair of the Board Management’s Discussion and Analysis Consolidated Financial Statements Shareholder Information Five Year Financial Summary

02 04 08 16 63 110 111

About Us CWB Financial Group (TSX: CWB) is the only full-service bank in Canada with a strategic focus to meet the unique financial needs of businesses and their owners. Our teams take a relationship-based approach to deliver a uniquely proactive client experience through highly personalized service, specialized expertise, customized solutions and faster response times. We provide full-service business and personal banking, nation-wide specialized financing in targeted industries, comprehensive wealth management offerings, and trust services. We are firmly committed to the responsible creation of value for all our stakeholders and our approach to sustainability will support our continued success. Our Values PEOPLE FIRST THE HOW MATTERS RELATIONSHIPS GET RESULTS INCLUSION HAS POWER EMBRACE THE NEW

Change is everywhere. We seek out new ideas and are committed to continuous learning. We know that better is always possible.

Diverse teams unleash new ideas and perspectives. We are aware of our own biases. We are proud of who we are, and we are allies for those around us.

How we do things is as important as what we do. We take ownership, and move with urgency and efficiency. We always act with integrity, and balance risk and reward.

Caring people are the key to our success. We work as a team and support one another. We always treat each other with respect and have the courage to be candid.

Clients choose CWB for the best experience. We build relationships proactively, with intention and consistency. Our results depend on it.

i | CWB Financial Group 2021 Annual Report

NEAL MEGANNETY (CWB) taking the time to understand his clients’

business model, banking needs, challenges, and opportunities. Read the story on page 10.

Connect with us:

CWB.COM

Our Strategy Creating value for the people who choose CWB every day

OUR CLIENTS Unrivaled experiences

OUR PEOPLE Destination for top talent

OUR INVESTORS Optimize our business

Personalized service, specialized industry expertise, customized solutions, faster response times

BUILD ON OUR STRENGTHS

Transformation Priorities

Growth Accelerators

• Brand: bolder and more visible to cut through the noise • Culture: proactive, client-focused, and change-ready to align with our strategy

• Targeted digital capabilities • Client-focused operating model • Fast, smooth, scalable processes • Transition to AIRB methodology for capital and risk management

TRANSFORM OUR BUSINESS

We deliver boutique, full-service client experiences through a range of in-person and digital channels

TO CREATE UNIQUE VALUE

We are positioned to be a disruptive force in Canadian financial services, deliver profitable long-term growth and provide attractive, sustainable returns to investors

CWB Financial Group 2021 Annual Report | 1

2021 (% CHANGE FROM 2020)

Performance Dashboard TOTAL LOANS $ 32.9 B 9% TOTAL ASSETS $ 37.3 B 10% BRANCH-RAISED DEPOSITS (1) $ 19.3 B 16% WEALTH MANAGEMENT AUM/AUA $ 10.8 B 27%

CET1 CAPITAL RATIO 8.8 % Stable

DIVERSIFYING LOANS BY PROVINCE (%)

DIVERSIFYING LOANS BY LENDING SECTOR (%)

FUNDING DIVERSIFICATION (%)

2021

13% Branch demand and notice deposits 5YR CAGR

14% General Commercial Loans 5YR CAGR

18% Ontario Loans 5YR CAGR

2016

British Columbia Alberta Ontario Remainder

General commercial loans Commercial mortgages

Branch demand and notice Branch term Broker term Sub debt and capital markets Securitization

Personal loans and mortgages Equipment financing and leasing Real estate project loans Oil and gas production loans

PRE-TAX, PRE-PROVISON INCOME (1) $ MILLIONS

REVENUE $ MILLIONS

DILUTED EPS $/SHARE

1,200

600

4.00

3.73

1,016

517

3.50 3.00 2.50 2.00 1.50 1.00 0.50 0

1,000

500

800

400

600

300

400

200

100

17 18 19 20 21

(1) Non-GAAP measure – refer to definitions and detail provided on page 18.

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Why invest in CWB

Investments in our digital client experience position us for continued strong full-service client growth

Our capital ratios have remained stable through economic volatility, with upside

We are a disciplined lender that delivers strong growth within our prudent risk appetite with a history of low write-offs

We are capitalizing on a significant opportunity to grow our brand and market share in Ontario

We are the only full-service bank in Canada with a focus to meet the unique financial needs of business owners

expected with a successful AIRB transition

Comprehensive capabilities with unrivaled full-service client experiences

k i

i g

BUSINESS BANKING Full suite of financing and cash management solutions

PERSONAL BANKING Full complement of banking services

SPECIALIZED FINANCING Highly personalized service, specialized expertise within specific industries, customized solutions and faster response times WEALTH MANAGEMENT Discretionary wealth management, comprehensive financial planning and investment solutions offered through our boutique approach

OUR CLIENT

N I A

TRUST SERVICES Comprehensive trustee and custodial solutions for individuals and businesses

STRONG CREDIT QUALITY %

1.50

Our five-year and ten-year average write-offs as a percentage of average loans (1) are 20 and 18 basis points, respectively.

1.20

0.90

0.60

0.30

Gross impaired loans as a % of gross loans

0.00

10 11

12 13 14 15 16

17 18 19 20 21

Write-offs as a % of average loans (1)

(1) Non-GAAP measure – refer to definitions and detail provided on page 18.

CWB Financial Group 2021 Annual Report | 3

Chris Fowler speaking at the 2021 CWB Virtual Leadership Conference

MESSAGE FROM PRESIDENT AND CEO Chris Fowler

TARGETED GROWTH WITH STRONG MOMENTUM

to Work Canada ® . We were also recognized as one of the Best Workplaces TM for Mental Wellness, in part due to the broadening of resources for our teams to build better understanding and engagement in mental health and wellness. To ensure CWB remains a career destination for top talent we will continue to strengthen our culture. We believe that we are better together, and when we return to the workplace, we will support and engage our employees so they can embrace the challenges and opportunities of a truly flexible and hybrid work environment. Defining the future of work at CWB will solidify our employer brand and allow us to attract top talent. Our focus on developing our inclusive and diverse culture is steadfast. I am proud of the employment experience and career development programs for Indigenous persons and persons with disabilities that we launched this year, and it is exciting to see our strong inclusive culture strengthened by several new employee represented groups (ERG). These employee-led groups enhance community and culture in our workplace by providing support and creating belonging, and driving action-oriented personal growth for our employees and leaders through education, professional development, and the sharing of lived experiences. We are seeing the successes of each ERG shared broadly and together they help to accelerate our high-performance culture. INVESTMENT IN OUR DIGITAL CHANNELS TO FUEL FUTURE GROWTH Our investment in digital channels will enhance our full-service client experience and support our strong growth momentum.

Very strong fiscal 2021 financial performance reflects the momentum our teams have built. Our winning strategy is uniquely focused on business owners who chose CWB for our proactive, personalized service and specialized advice. With the strategic investments we have made in our capabilities and teams, we are now a stronger full-service bank with even more business owners choosing CWB for the unrivaled client experience we deliver. We are expanding our presence in Ontario to drive strong, diversified growth targeted at full-service clients. Our funding sources and portfolio composition continue to diversify, and we are augmenting our revenue mix through the boutique wealth management services we provide to business owners and their families. Driven by the strategic focus on growth enabling activities, our revenue has increased 13% to surpass $1 billion for the first time in our history. Achievement of this milestone reflects the dedication of our teams who continue to execute our strategy and create unrivaled client experiences, despite the challenging operating environment that persisted this year. CAREER DESTINATION FOR TOP TALENT Our people are a core competitive strength, and we are committed to be a career destination for top talent. I am very pleased that our unwavering commitment to advance our people first culture was recognized as one of the 50 Best Workplaces TM in Canada again this year by Great Place

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Our digital client offering is advancing well. We are on track with the release of our digital banking platform for personal and small business clients and have started a limited initial roll-out of our Virtual Chief Operating Officer (Virtual COO) solution, a differentiated tool for small business owners. Once fully operational, we expect our targeted digital capabilities will enhance growth as we diversify our business across Canada and win new clients both within and outside our banking centre footprint, while further broadening our access to stable lower cost funding. BUILDING ON OUR MOMENTUM As a trusted financial partner, we have gained valuable experience lending through numerous business cycles. Our history of low realized credit losses is a result of targeting clients with strong credit profiles and balance sheets. CWB’s unique strategic focus and commitment to our clients resonates with business owners and has contributed to strengthening our strong brand and net promoter scores. Enhanced capabilities created from our commitment to invest in a transformative strategy support ongoing growth in our largest full-service opportunity - general commercial loans. This category represents a broad section of the Canadian economy that is underserved, and our focus to create unrivaled client experiences is yielding strong results. Clients in Ontario continue to demonstrate they are ready for a clear alternative to the big banks and the implementation of our strategy in the province enables us to be that disruptive force. We are committed to our expansion strategy in Ontario and are excited for the opening of a second banking centre in 2022, located in Markham.

On average over the last five years, we have grown general commercial loans by 14% annually, and have increased loans in Ontario by 18% annually. Over that same period, we have also grown our branch-raised demand and notice deposits by 13% annually and diversified our other sources of funding. These results reflect our tremendous momentum. Continued strong growth of our franchise will be supported by the combination of our investments in digital capabilities, our focus on delivering a lower cost funding model, and a transition from a Standardized to a model enabled AIRB bank. CWB’s capabilities will be more competitive, support higher growth, and achieve further diversification. We remain dedicated to the responsible creation of value for all our stakeholders and our long-term success is bolstered by firm commitments to ESG and sustainability. In closing I would like to express my sincere gratitude to our people, our clients, and our investors. To our people, I want to thank you for your tireless efforts to advance our strategy and create unrivaled client experiences. To our clients, I want to thank you for your trust, we are honoured that you have chosen CWB, and we are Obsessed With Your Success TM . To our investors, I want to thank you for your confidence and commitment. We are well positioned as a disruptive force in Canadian financial services to deliver profitable long-term growth and provide attractive, sustainable returns.

Chris Fowler President and Chief Executive Officer

MOMENTUM

CWB Financial Group 2021 Annual Report | 5

Executive Committee

Chris Fowler President and Chief Executive Officer

Kelly Blackett Executive Vice President, Human Resources and Corporate Communications

Matt Rudd Executive Vice President and Chief Financial Officer

Stephen Murphy Executive Vice President, Banking

Glen Eastwood Executive Vice President, Business Transformation

Carolyn Graham Executive Vice President and Chief Risk Officer

Darrell Jones Executive Vice President and Chief Information Officer

Welcome! CAROLINA PARRA

Joined CWB on November 15th, 2021 as our Executive Vice President and Chief

Risk Officer. Carolyn Graham continues to be Executive Leader of our AIRB program.

6 | CWB Financial Group 2021 Annual Report

Corporate Governance CWB Financial Group strives to maintain the trust of our stakeholders through high standards of corporate governance. Our corporate governance practices, including our code of conduct, our director independence standards and our board and committee mandates, are available on our website at cwb.com/corporate- governance. The Board of Directors has oversight of CWB Financial Group’s ESG program and cybersecurity. The Board carries out much of its work through the following four standing committees: • Audit Committee: Quality and integrity of financial reporting, including internal and external audit and internal financial controls. • Governance and Conduct Review Committee: Governance policies and practices, oversight of legal, regulatory compliance, financial crime and misconduct risk, director succession and compensation, and Board and

Board of Directors

SARAH A. MORGAN- SILVESTER Corporate Director

ANDREW J. BIBBY Corporate Director

DR. MARIE Y. DELORME CEO, The Imagination Group of Companies

MARGARET J. MULLIGAN Corporate Director

ROBERT L. PHILLIPS (Chair) President, R.L. Phillips Investments Inc.

MARIA FILIPPELLI Corporate Director

CHRISTOPHER H. FOWLER President and CEO, Canadian Western Bank

individual director effectiveness. • Human Resources Committee:

IRFHAN A. RAWJI CEO, MobSquad

Compensation practices and programs, talent management, succession planning, employee engagement, and employment equity, inclusion, and diversity. • Risk Committee: Enterprise risk

LINDA M.O. HOHOL Corporate Director

IAN M. REID Corporate Director

management and risk appetite frameworks, and technology risk including data governance.

CWB’s Management Proxy Circular will be available on our website in February 2022. It will include information on our director nominees, reports of each board committee, and detailed descriptions of our corporate governance practices. Please review our circular to learn how shareholders can participate in our annual meeting on April 7, 2022. We are committed to open communication with stakeholders – please contact us at: ChairoftheBoard@cwbank.com or CorporateSecretary@cwbank.com

H. SANFORD RILEY President and

ROBERT A. MANNING President, Cathton Investments Ltd.

CEO, Richardson Financial Group Limited

E. GAY MITCHELL Corporate Director

CWB Financial Group 2021 Annual Report | 7

MESSAGE FROM CHAIR OF THE BOARD Bob Phillips

Our results once again reflect the progress our team has made to create momentum and advance our transformative strategy, and the tremendous dedication of our people and their commitment to help our clients achieve their financial goals. Your Board continues to provide comprehensive risk and governance oversight as CWB positions ourselves to capitalize on emerging trends in our industry. We fully support management as they execute CWB’s winning strategy to deliver the best full-service bank for business owners in Canada. TALENT IS KEY TO OUR SUCCESS As a Board we oversee succession planning across our senior management and executive teams to ensure we have a diverse and inclusive culture. Our commitment to renewal ensures that your Board is comprised of strong directors with diversified backgrounds, experiences, perspectives, and skills. This year we welcomed two outstanding directors to the Board who bring unique experience and expertise that are valuable in delivery of our strategic direction. Dr. Marie Delorme is a successful entrepreneur, philanthropist and an Order of Canada recipient known for her work with Indigenous economic development and women’s leadership. Mr. Irfhan Rawji brings extensive experience with innovative technology and venture capital backed companies. With these two new members, I am proud to say 46% of your board is constituted of women and 15% Black, Indigenous or racialized persons.

Another key area of focus for your Board is to provide oversight to all aspects of sustainability, which includes ESG factors. We are highly committed to lead by example in how we live our values. With the support of the Board, management designed and launched a phased implementation of the recommendations from the Task Force on Climate-related Financial Disclosures (TCFD). Management also designed and launched a Sustainability roadmap, which will guide our proactive and strategic approach to all aspects of ESG. We are committed to ongoing discussion and review of sustainability issues to provide oversight and support to management in execution of the roadmap. On behalf of the Board, I want to express my confidence and gratitude to the Executive team for their unwavering commitment to our success and thank every CWB team member who has worked tirelessly to ensure we create long- term value for all our stakeholders. I also want to express appreciation to my fellow shareholders for their ongoing support and to our clients for the opportunity to be their full- service financial provider.

Robert Phillips Chair of the Board

THANK YOU RAY, FROM CWB This year Mr. Ray Protti retired after 12 years on our Board. With his extensive background, he provided a level of judgment and advice that was of significant benefit to the Board and management. Thank you, Ray, you were a terrific director throughout your tenure and your contributions will be missed.

8 | CWB Financial Group 2021 Annual Report

Digital transformation

By combining a transformative digital client experience with modern technology infrastructure, we are providing enhanced value and advice to our clients in a scalable manner. We fuse human-centred design principles with our modern core systems and Application Programming Interface (API) architecture, a powerful combination of CWB’s traditional and emerging strengths. The result is clients who are delighted by their experience, from onboarding to using our new digital banking services, which also enables seamless use of their third-party data platforms. A ground-breaking example is our partnership with Temenos on our Virtual COO.

PROVIDE UNRIVALED CLIENT EXPERIENCES AND OPTIMIZE OUR BUSINESS WITH DIGITAL

Integrated and personalized client experiences

Grow and retain lower cost deposits

Expand reach & new client acquisition

Support portfolio diversification with a small business lending solution

Improve team productivity by reducing manual effort

CWB’S VIRTUAL COO IS AN INNOVATIVE TOOL FOR SMALL BUSINESS OWNERS

analytics and machine intelligence, this first-in- Canada tool provides small business owners access to vital information to strengthen and grow their business. CWB’s VCOO provides clients with: • Real-time access to cash flow information and their Business Health Score; • Better cash flow analytics with simulations; and, • Customizable and actionable, data-driven insights. In the future, we’ll continue to realize our advantage through targeted innovations based on our clients’ needs and our

strategic priorities and long-term objectives.

CWB Financial Group 2021 Annual Report | 9

“We were at a spot where we might have had to walk away from profitable growth opportunities, but CWB came to the table with the banking solution we needed”

– STEPHEN DULONG Owner and CEO of TAGG Industries

STEPHEN DULONG , CEO, TAGG Industries BRIAN GARDINER , CFO, TAGG Industries NEAL MEGANNETY , AVP, Business Development, CWB

10 | CWB Financial Group 2021 Annual Report

Growing together...

For Stephen Dulong, finding a bank that fit his needs was a frustrating experience. That is until he sat down with the team at CWB. Dulong is the sole owner and CEO of three material fabricators and subcontractors that design and manufacture products for commercial building construction – TAGG Industries (architectural glass), M&G Steel (structural steel), and Krisro Metal (panels). This unique operating model provides integrated solutions for his customers and is a differentiator that he intends to leverage for future growth.

As the economy began to reopen, Stephen saw an opportunity to expand his business. However, finding a bank that would take the time to truly understand his strategy and put together a specialized financial solution to support this growth was proving to be an obstacle for him to move forward. “We were at a spot where we might have had to walk away from profitable growth opportunities, but CWB came to the table with the banking solution we needed”. For Dulong, the CWB difference translates to taking the time to understand his business model, banking needs, challenges, opportunities and offer solutions that work for both him and the bank. Part of CWB’s boutique-style approach is bringing together banking experts from a variety of service pillars as one united deal team to come up with creative solutions. Solutions that consider the whole client and work with their own unique situation. “Everyone delivers as a united team, with one mandate to proactively service the needs of our clients,” says Vice- President and District Manager Mark Stafford, who is based out of the CWB Mississauga banking centre that supports Dulong. Now with a solid growth strategy in place, next up for Dulong is to expand his businesses’ geographic footprint. And he’s once again enlisted CWB to help. Because, as Dulong says, at long last: “We really feel like we have a partner.”

“We put the business owner at the centre of everything we do.”

– MARK STAFFORD Vice President and District Manager

CWB Financial Group 2021 Annual Report | 11

Continued focus on ESG and sustainability Our strategy, culture, and values guide our approach to sustainability, which includes environmental, social, and governance (ESG) factors. We remain firmly committed to long-term value creation for all our stakeholders: our people, clients, investors, and communities. As part of our developing approach to sustainability, we will continue to enhance our ESG disclosures to provide our stakeholders with timely and transparent information.

To learn more about our approach, visit www.cwb.com/corporate- social-responsibility where you can

find our most recent: • Corporate Social

Responsibility Report • Equity Report Narrative • Public Accountability Statement • Management Proxy Circular • Code of Conduct

KEY ESG HIGHLIGHTS FROM 2021

Social Supporting our clients,

Environmental Developing a comprehensive approach to climate change Engaged an external partner to develop a measurement of baseline Scope 1 and 2 greenhouse gas (GHG) emissions for fiscal 2022. Our next steps will be to establish GHG emission reduction management and targets, and explore measurement of our Scope 3 GHG emissions. Began phased implementation of the TCFD recommendations for climate- related disclosures. For further details, refer to Climate Risk on page 60. Continued to participate in national climate-related programs, including the Sustainable Finance Action Council and industry working groups focused on climate risk and disclosure.

Governance Ensure the highest standards of governance, ethics, and integrity Increased the diversity of our Board , which is now comprised of 46% Women, and 15% Black, Indigenous or racialized persons Strengthened board oversight of sustainability through board education sessions and regular discussion and review of ESG factors, including climate risk. Bolstered our risk culture through employee education to ensure sound decision making, accountability, and integrity. Refreshed our ethics and conduct program.

employees, and communities Invested more than 40,000 hours in employee training and development, which included nearly 2,000 hours towards voluntary Indigenous Awareness training. Invested over $1.8 million in our communities focused on Enabling Business and Promoting Inclusivity and provided more than $250,000 in employee volunteer grants and matching initiatives. Further strengthened our commitment to financial inclusion with the creation of a CWB Seniors Champion and over 2,000 hours of employee training focused on seniors’ awareness.

CYBERSECURITY This year, we continued to benchmark and enhance our cybersecurity capabilities, including nearly 9,000 hours of employee training to stay ahead of threats.

12 | CWB Financial Group 2021 Annual Report

Inclusion & diversity Our Inclusion has Power core value ensures we reach our full potential by welcoming new ideas and perspectives. This year, we continued to strengthen diverse talent recruitment and self-directed learning, and introduced an enterprise-wide performance objective for leaders and employees to further embed inclusion into our day-to-day practices. We continue to increase diversity in our business, with our workforce now comprised of:

60% Women

30% Black, Indigenous or racialized persons

5% Persons with disabilities

CWB ASPIRE ASIAN SOUTH ASIAN PACIFIC ISLANDERS RALLYING FOR EQUALITY

EMPLOYEE REPRESENTED GROUPS (ERG) ERGs are a key focus of our culture, creating space for belonging and peer support for employees with a diversity of backgrounds and interests.

Recognized as one of the 50 Best Workplaces TM in Canada for the second consecutive year by Great Place to Work Canada ® and one of the Best Workplaces TM for Mental Wellness.

CWB IS A GREAT PLACE TO WORK!

CWB Financial Group 2021 Annual Report | 13

“Chana is an amazing leader of a high performance team, and as an Indigenous woman she brings a valuable perspective

that demonstrates that inclusion has power. As a founder of the CWB Sharing Circle ERG, she is ensuring we tap further into this power to support our people and drive a more inclusive culture.”

– STEPHEN MURPHY EVP, Banking

CHANA MARTINEAU, VP Manitoba, Saskatchewan & Rural Alberta

Pictured alongside her daughters, and father Ron, sharing in their Indigenous culture at the Fort Edmonton Park Indigenous Peoples Experience

14 | CWB Financial Group 2021 Annual Report

Inclusion has power...

CWB supported the Fort Edmonton expansion project by contributing to the Indigenous Peoples Experience

TAKING ACTION I am so proud of how CWB has committed to supporting Indigenous communities such as contributing to the Fort Edmonton Indigenous Peoples Experience, investing in Indigenous students’ post-secondary education and hosting our own Indigenous Internship program. This program gives us two

After almost three decades into my financial career, I joined CWB Financial Group and finally feel at home. To be honest I get emotional thinking about the people first approach at CWB and what it means to me: a sense of belonging and acceptance for who I am. I am Indigenous and am deeply proud of my heritage. Although I do not outwardly appear Indigenous and have never experienced the degree of racism that many of my relatives have endured, I have experienced deep and hurtful racist comments. I’ve carried them with me for many years. Those memories seemed to manifest themselves in the last several years, making me fully realize their impact, keeping me from embracing my heritage and never truly accepting my history. FINALLY BEING ME All of this changed in early 2020. In a discussion I was asked by my leader, Stephen Murphy what I envisioned for my CWB future. I told him how I wanted to marry my Indigenous background with my career. He listened carefully and offered me a chance of a lifetime: to help create, along with several amazing co-workers, an Employee Representative Group (ERG), the CWB Sharing Circle. I am proud to be one of the executive sponsors, where I advise, support and advocate for the group and its mandate. This incredible group helps our Indigenous employees and allies feel more united and supported at work. They provide resources, events and virtual learning sessions that connect employees across the country; a level of connection I couldn’t have thought possible. As a member, I felt empowered to share my story through a blog for National Indigenous Peoples Day in June. The outpouring of support and love from my CWB colleagues far and wide was amazing. Since that time, I feel truly able to be my whole self, to honour all the parts of my heritage and to help my daughters see and understand our heritage.

way-learning: our Indigenous Interns learn about banking, and we learn about Indigenous culture and how we can be a more welcoming place for Indigenous employees and customers. We truly have a sharing circle. HELPING TO MOVE THE DIAL My learning continues to grow. In my current role as a Vice President in the Prairies region, I am re-connected with Indigenous peoples, who still face daily challenges including banking. I am also working with a team to enhance CWB’s ability to support the economic development of Indigenous communities. CWB has helped me get there: to build stronger relationships and to grow our talent, hiring Indigenous people with skills and endless vision. At CWB, I feel like I am home: accepted for all that I am, encouraged to seek new heights and provided a role and a platform that I can influence positive change for Indigenous people. I will continue to use my privilege to lend my voice to drive change and to help our peoples stand strong, together and united.

— CHANA MARTINEAU, VP Manitoba, Saskatchewan & Rural Alberta

CWB Financial Group 2021 Annual Report | 15

Management’s Discussion and Analysis

TABLE OF CONTENTS Forward-Looking Statements...............................................17 Non-GAAP Measures...........................................................18

Other Assets and Other Liabilities..................................................35 Liquidity Management....................................................................36 Capital Management......................................................................38 Financial Instruments and Other Instruments................................41 Off-Balance Sheet...........................................................................42 Summary of Quarterly Results and Fourth Quarter.................42 Quarterly Results............................................................................42 Fourth Quarter of 2021...................................................................43 Accounting Policies and Estimates........................................43 Critical Accounting Estimates........................................................43 Changes In Accounting Policies and Financial Statement Presentation..............................................................45 Future Changes In Accounting Policies..........................................45 Risk Management...............................................................46 Top Emerged and Emerging Risks..................................................46 Risk Management Overview...........................................................47 Risk Universe - Report on Principal Risks........................................51 Other Risk Factors..........................................................................61 Share and Distribution Information.......................................62 Related Party Transactions...................................................62 Controls and Procedures.....................................................62

Who We Are.......................................................................19 Growth Strategy and Vision............................................................19

Strategic Transaction..........................................................19 Fiscal 2021 Strategic Highlights............................................20

Fiscal 2022 Strategic Priorities.............................................21 A Sustainable Path Forward............................................................21

CWB Financial Group Performance.......................................22 Select Financial Highlights.............................................................22 Summary of Operations..................................................................23 Fiscal 2022 Outlook .......................................................................24 Net Interest Income........................................................................25 Non-Interest Income.......................................................................26 Non-Interest Expenses and Efficiency Ratio...................................27 Income Taxes..................................................................................28 Comprehensive Income .................................................................28 Cash and Securities........................................................................29 Loans............................................................................................... 30 Credit Quality.................................................................................32 Deposits and Funding.....................................................................34

16 | CWB Financial Group 2021 Annual Report

This Management’s Discussion and A nalysis (MD&A), dated December 2, 2021, should be read in conjunction with the audited consolidated financial statements of Canadian Western Bank (CWB) for the year ended October 31, 2021 and the audited consolidated financial statements and MD&A for the year ended October 31, 2020. Additional information relating to CWB, including the Annual Information Form, is available on SEDAR at www.sedar.com and on our website at www.cwb.com.

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and are presented in Canadian dollars.

FORWARD-LOOKING STATEMENTS From time to time, we make written and verbal forward-looking statements. Statements of this type are included in our Annual Report and reports to shareholders and may be included in filings with Canadian securities regulators or in other communications such as media releases and corporate presentations. Forward-looking statements include, but are not limited to, statements about our objectives and strategies, targeted and expected financial results and the outlook for CWB’s businesses or for the Canadian economy. Forward- looking statements are typically identified by the words “believe”, “expect”, “anticipate”, “intend”, “estimate”, “may increase”, “may impact”, “goal”, “focus”, “potential”, “proposed” 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 and are subject to inherent risks and uncertainties, which give rise to the possibility that our predictions, forecasts, projections, expectations and conclusions will not prove to be accurate, that our assumptions may not be correct, and that our strategic goals will not be achieved. A variety of factors, many of which are beyond our 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 housing market conditions, the volatility and level of liquidity in financial markets, fluctuations in interest rates and currency values, the volatility and level of various commodity prices, changes in monetary policy, changes in economic and political conditions, material changes to trade agreements, transition to the Advanced Internal Ratings Based (AIRB) approach for regulatory capital purposes, legislative and regulatory developments, legal developments, the level of competition, the occurrence of natural catastrophes, outbreaks of disease or illness that affect local, national or international economies, changes in accounting standards and policies, information technology and cyber risk, the accuracy and completeness of information we receive 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 business infrastructure, changes in tax laws, technological developments, unexpected changes in consumer spending and saving habits, timely development and introduction of new products, and our 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. Additional information about these factors can be found in the Risk Management section of our MD&A. 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 our actual results to differ materially from the expectations expressed in such forward-looking statements. Any forward-looking statements contained in this document represent our views as of the date hereof. Unless required by securities law, we do not undertake to update any forward-looking statement, whether written or verbal, that may be made from time to time by us or on our behalf. The forward-looking statements contained in this document are presented for the purpose of assisting readers in understanding our financial position and results of operations as at and for the periods ended on the dates presented, as well as our strategic priorities and objectives, and may not be appropriate for other purposes. Assumptions about the performance of the Canadian economy over the forecast horizon and how it will affect our business are material factors considered when setting organizational objectives and targets. In determining expectations for economic growth, we consider our own forecasts, economic data and forecasts provided by the Canadian government and its agencies, as well as certain private sector forecasts. These forecasts are subject to inherent risks and uncertainties that may be general or specific. The full extent of the impact that the COVID-19 pandemic, including evolving government and regulatory responses to the outbreak, will continue to have on the Canadian economy and our business is uncertain and difficult to predict at this time. Where relevant, material economic assumptions underlying forward-looking statements are disclosed within the Fiscal 2022 Outlook and Allowance for Credit Losses sections of our MD&A.

CWB Financial Group 2021 Annual Report | 17

NON-GAAP MEASURES We use a number of financial measures and ratios to assess our performance against strategic initiatives and operational benchmarks. Some of these financial measures and ratios do not have standardized meanings prescribed by Generally Accepted Accounting Principles (GAAP) and may not be comparable to similar measures presented by other financial institutions. Non-GAAP financial measures and ratios provide readers with an enhanced understanding of how we view our ongoing performance. These measures and ratios may also provide the ability to analyze trends related to profitability and the effectiveness of our operations and strategies, and are disclosed in compliance with National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure . To calculate non-GAAP financial measures, we exclude certain items from our financial results prepared in accordance with IFRS. Adjustments relate to items which we believe are not indicative of underlying operating performance. Our non-GAAP financial measures include: • Adjusted non-interest expenses – total non-interest expenses, excluding pre-tax amortization of acquisition-related intangible assets, and acquisition and integration costs. Acquisition and integration costs include direct and incremental costs incurred as part of the execution and integration of the acquisition of the businesses of T.E. Wealth and Leon Frazer & Associates. • Adjusted common shareholders’ net income – total common shareholders’ net income, excluding the amortization of acquisition -related intangible assets, and acquisition and integration costs, net of tax. • Pre-tax, pre-provision income – total revenue less adjusted non-interest expenses.

The following table provides a reconciliation of our non-GAAP financial measures to our reported financial results.

Table 1 – Non-GAAP Measures ($ thousands)

For the three months ended

For the year ended

October 31 2021

October 31 2020

October 31 2021

October 31 2020

Non-interest expenses

140,802

123,206

508,718

436,646

Adjustments (before tax): Amortization of acquisition-related intangible assets

(2,032)

(1,991)

(8,073) (1,761)

(6,127) (2,442)

Acquisition and integration costs

(893)

(907)

Adjusted Non-interest Expenses

137,877

120,308

498,884

428,077

Common shareholders' net income

89,998

63,380

327,471

248,956

Adjustments (after-tax): Amortization of acquisition-related intangible assets (1)

1,485

1,443

5,901 1,329

4,515 1,804

Acquisition and integration costs (2)

674

669

Adjusted Common Shareholders' Net Income

92,157

65,492

334,701

255,275

Total revenue

260,624

236,575

$ 1,016,033

897,395

Less: Adjusted non-interest expenses (see above)

137,877

120,308

498,884

428,077

Pre-tax, Pre-provision Income

122,747

116,267

517,149

469,318

(1) Net of income tax of $547 for the three months ended October 31, 2021 (Q4 2020 – $548) and $2,172 for the year ended October 31, 2021 (2020 – $1,612). (2) Net of income tax of $219 for the three months ended October 31, 2021 (Q4 2020 – $238) and $432 for the year ended October 31, 2021 (2020 – $638).

Non-GAAP ratios are calculated using the non-GAAP financial measures defined above. Our non-GAAP ratios include: • Adjusted earnings per common share – diluted earnings per common share calculated with adjusted common shareholders’ net income.

• Adjusted return on common shareholders’ equity – adjusted common shareholders’ net income divided by average common shareholders’ equity, which is total shareholders’ equity excluding preferred shares and limited recourse capital notes.

• Efficiency ratio – adjusted non-interest expenses divided by total revenue.

• Operating leverage – growth rate of total revenue less growth rate of adjusted non-interest expenses.

Supplementary financial measures are measures that do not have definitions prescribed by GAAP, but do not meet the definition of a non-GAAP financial measure or ratio. Our supplementary financial measures include: • Return on assets – common shareholders’ net income divided by average total assets.

• Net interest margin – net interest income divided by average total assets.

• Return on common shareholders’ equity – common shareholders’ net income divided by average common shareholders’ equity.

• Write-offs as a percentage of average loans – write-offs divided by average total loans.

• Book value per common share – total common shareholders’ equity divided by total common shares outstanding.

• Branch-raised deposits – total deposits excluding broker term and capital market deposits.

• Provision for credit losses on total loans as a percentage of average loans – provision for credit losses on loans, committed but undrawn credit exposures and letters of credit divided by average total loans. Provisions for credit losses related to debt securities measured at fair value through other comprehensive income (FVOCI) and other financial assets are excluded.

• Provision for credit losses on impaired loans as a percentage of average loans – provision for credit losses on impaired loans divided by average total loans.

• Provision for credit losses on performing loans as a percentage of average loans – provision for credit losses on performing loans (Stage 1 and 2) divided by average total loans.

• Average balances – average daily balances.

18 | CWB Financial Group 2021 Annual Report

WHO WE ARE CWB is the only full-service bank in Canada with a strategic focus to meet the unique financial needs of businesses and their owners. Our teams take a relationship-based approach to deliver a uniquely proactive client experience through highly personalized service, specialized expertise, customized solutions and faster response times. We provide full-service business and personal banking, nation-wide specialized financing in targeted industries, comprehensive wealth management offerings, and trust services. We are firmly committed to the responsible creation of value for all our stakeholders and our approach to sustainability will support our continued success. GROWTH STRATEGY AND VISION Our highly engaged teams operate within a client-centric, collaborative and change-ready culture, with a core focus to achieve our vision to become the best full-service bank for business owners in Canada. We continue to transform our capabilities to offer a superior full-service client experience through a complete range of in-person and evolving digital channels. These improving capabilities have accelerated growth of full-service client relationships in specifically targeted segments that fit within our strategic growth objectives and prudent risk appetite. Ongoing strategic execution will create long-term value for shareholders as we deliver strong growth of full-service clients and capitalize on the opportunities available to us as we continue to expand our geographic footprint outside of Western Canada, including an increased presence in the Ontario market.

Our differentiated market position and transformation-focused strategy has set the stage for CWB to be a disruptive force in Canadian financial services, deliver profitable long-term growth and enhance shareholder returns for years to come.

STRATEGIC TRANSACTION On June 1, 2020, we completed the acquisition of 100% of the common shares of iA Investment Counsel Inc., an investment counsellor operating under the brands T.E. Wealth and Leon Frazer & Associates (the wealth acquisition). The purchase price of $87 million was paid in cash upon closing and represented an investment of 30 basis points of regulatory capital. The wealth acquisition is a transformative step forward for CWB to become a leader in private wealth for Canadian business owners and their families, with focused capabilities in complex financial planning and investment management and an extended geographic footprint, to support our continued growth of strong client relationships across the country. T.E. Wealth and Leon Frazer & Associates provide financial planning and wealth management services targeting high-net-worth Canadian families. T.E. Wealth is also one of the largest and most reputable providers of investment management and financial education services to Indigenous communities, with offerings provided under the T.E. Wealth Indigenous Services brand. With a significant portion of the client base in Ontario, the wealth acquisition will support our continued growth of strong full-service client relationships across the country. The integration of our wealth management operations will provide a differentiated private wealth experience to our clients, and continues to progress in line with our expectations. The wealth acquisition contributed $5.8 billion to assets under management, advisement and administration on the acquisition date, which grew to $7.1 billion at October 31, 2021 (October 31, 2020 – $5.9 billion) primarily due to market value appreciation supported by full advisor retention and no significant client attrition related to the acquisition. Indigenous Services assets under advisement of $1.7 billion at acquisition have increased to $2.0 billion at October 31, 2021 (October 31, 2020 – $1.8 billion). The operations of the wealth acquisition, which were only included in our financial results for five months in the prior fiscal year, contributed $36 million (2020 – $15 million) to non-interest income and $37 million (2020 – $18 million) to non-interest expenses, which included $2 million (2020 – $2 million) of integration costs as well as $3 million (2020 – $1 million) of amortization of acquisition-related intangible assets. The wealth acquisition has contributed approximately $0.04 to adjusted earnings per common share (1) in fiscal 2021, surpassing our previous expectations.

(1) Non-GAAP measure – refer to definition and detail provided on page 18.

CWB Financial Group 2021 Annual Report | 19

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