NON-INTEREST EXPENSES AND EFFICIENCY RATIO
Highlights of 2021 • Non-interest expenses increased 17%, or 10% excluding the wealth acquisition and costs associated operating and enhancing our AIRB tools and processes. • An efficiency ratio of 49.1% compared to 47.7% last year due to the impact of the wealth acquisition and continued investment in strategic execution, which outpaced revenue growth. Excluding the wealth acquisition, the efficiency ratio of 47.7% compared to 46.9% last year.
Table 7 - Non-interest Expenses and Efficiency Ratio ($ thousands)
2021
2020
Change from 2020
Salaries and Employee Benefits Salaries
$
271,946
$
234,759
$
37,187
16 %
Employee benefits
53,190
46,649
6,541
14
325,136
281,408
43,728
16
Premises Depreciation
17,802 10,388
18,765
(963)
(5)
Rent
9,804 4,089
584
6
Other
3,983
(106)
(3)
32,173
32,658
(485)
(1)
Equipment and Software Depreciation
32,422 31,359
25,556 22,148
6,866 9,211
27 42
Other
63,781
47,704
16,077
34
General Professional fees and services
20,517 12,894 10,339
12,125 12,789
8,392
69
Regulatory costs
105
1
Marketing and business development
9,169 6,127 5,743 3,412 3,241 2,111 2,442 2,385 1,539 2,010
1,170 1,946 2,293
13 32 40 23
Amortization of acquisition-related intangible assets
8,073 8,036 4,187 3,370 2,094 1,761 1,530 1,501
Banking charges
Employee recruitment and training
775 129 (17)
Loan-related credit reports
4
Communications
(1)
Acquisition and integration costs
(681) (855)
(28) (36)
Capital and business taxes
Staff relations
(38)
(2)
Travel
895
(1,115)
(55)
Other
12,431
11,783
648
5
87,628
74,876
12,752
17
Total Non-interest Expenses
$
508,718
$
436,646
$
72,072
17 %
Efficiency Ratio (1)
49.1 %
47.7 %
140 bp
(1) A decrease in this ratio reflects improved efficiency, while an increase reflects deterioration. Excluding the impact of the wealth acquisition, our efficiency ratio would have been 47.7% in fiscal 2021 (2020 – 46.9%).
bp – basis point
Total non-interest expenses of $509 million were up 17% ($72 million). The increase reflected approximately $19 million due to the full year impact of the wealth acquisition, which occurred partway through fiscal 2020, and an additional $11 million related to costs associated with operating and enhancing our AIRB tools and processes. Excluding the wealth acquisition and AIRB-related costs, non-interest expense growth was 10%. The remaining increase was driven by continued investment in our teams and technology infrastructure.
CWB Financial Group 2021 Annual Report | 27
Powered by FlippingBook