CWBFG Annual Report 2021

October 31, 2021

Total Carrying Amount

Fair Value Over Carrying Amount

Amortized Cost

Derivatives

FVOCI

Fair Value

Financial Assets Cash resources

- $

107,115 $

21,344 $

128,459 $

(Note 4)

Securities (2)

3,567,797

(Note 5)

Securities purchased under resale agreements

30,048

Loans (3)

32,903,208

33,138,017

234,809

Derivatives

52,862

Total Financial Assets

52,862 $

33,040,371 $

3,589,141 $

36,682,374 $

36,917,183 $

234,809

Financial Liabilities Deposits (3)

- $

29,982,829 $

- $

29,982,829 $

30,118,635 $

135,806

Debt

3,015,065

3,058,090

43,025

Derivatives

36,068

Total Financial Liabilities

36,068 $

32,997,894 $

- $

33,033,962 $

33,212,793 $

178,831

October 31, 2020

Total Carrying Amount

Fair Value Over Carrying Amount

Amortized Cost

Derivatives

FVOCI

Fair Value

Financial Assets Cash resources

- $

113,868 $

254,451 $

368,319 $

(Note 4)

Securities (2)

2,664,618

(Note 5)

Securities purchased under resale agreements

50,084

Loans (3)

30,158,951

30,541,660

382,709

Derivatives

96,615

Total Financial Assets

96,615 $

30,322,903 $

2,919,069 $

33,338,587 $

33,721,296 $

382,709

Financial Liabilities Deposits (3)

- $

27,328,985 $

- $

27,328,985 $

27,738,072 $

409,087

Securities sold under repurchase agreements

65,198

Debt

2,424,323

2,483,015

58,692

Derivatives

6,285

Total Financial Liabilities

6,285 $

29,818,506 $

- $

29,824,791 $

30,292,570 $

467,779

(1) For further information on interest rates associated with financial assets and liabilities, including derivative instruments, refer to Note 24. (2) Securities are comprised of $3,567,797 (2020 - $2,662,626) measured at FVOCI and $nil (2020 - $1,992) designated at FVOCI. (3) Loans and deposits exclude deferred premiums, deferred revenue and allowance for credit losses, which are not financial instruments.

The methods and assumptions used to estimate the fair values of financial instruments are as follows:

• Interest bearing deposits with regulated financial institutions and securities are reported on the consolidated balance sheets at the fair value disclosed in Notes 4 and 5. Remaining cash resources and securities purchased under resale agreements are reported at amortized cost, which is equal to fair value, on the consolidated balance sheets. These values are based on quoted market prices, if available. Where a quoted market price is not readily available, other valuation techniques are based on observable market rates used to estimate fair value. • Fair value of loans reflect changes in the general level of interest rates that have occurred since the loans were originated and exclude the allowance for credit losses. Fair value is estimated by discounting the expected future cash flows of these loans at current market rates for loans with similar terms and risks. • With the exception of derivative financial instruments and contingent consideration, financial instruments included within other assets and other liabilities reported on the consolidated balance sheets have carrying values that closely approximate fair value. • For derivative financial instruments where an active market does not exist, fair values are determined using valuation techniques that refer to observable market data, including discounted cash flow analysis, option pricing models and other valuation techniques commonly used by market participants. • The estimated fair values of deposits are determined by discounting the contractual cash flows at current market rates for deposits of similar terms. • The fair values of debt are determined by reference to current market prices for debt with similar terms and risks.

Fair values are based on our best estimates based on market conditions and pricing policies at a certain point in time. The estimates are subjective and involve particular assumptions and matters of judgment and, as such, may not be reflective of future fair values.

106 | CWB Financial Group 2021 Annual Report