LOANS
Highlights of 2021
• Overall strong loan growth of 9%, with 24% growth in commercial mortgages and 12% growth in our strategically targeted general commercial portfolio.
• Achieved further geographic diversification, with strong 10% growth in Ontario with strong momentum building from our new Mississauga banking centre.
Table 10 - Outstanding Loans by Portfolio ($ millions)
2021
2020
Change from 2020
General commercial loans
$
10,895
$
9,697 5,696 6,074 5,254 3,252
$
1,198 1,343
12 %
Commercial mortgages
7,039 6,396 5,286 2,871
24
Personal loans and mortgages
322
5 1
Equipment financing and leasing
32
Real estate project loans
(381)
(12)
Oil and gas production loans
414
195
219
112
Total Outstanding Loans (1)
$
32,901
$
30,168
$
2,733
9 %
(1) Total loans outstanding by lending sector exclude the allowance for credit losses.
Total loans, excluding the allowance for credit losses, increased 9% ($2.7 billion) compared to last year.
Growth by lending sector was consistent with our ongoing efforts to increase full-service relationships across our national footprint. We delivered strong growth in our strategically targeted general commercial portfolio, which increased 12% ($1.2 billion) this year, with 40% of the growth contributed by Ontario. General commercial lending reflects activity across a broad range of industries, such as manufacturing, construction, transportation, retail trade, hospitality, healthcare, professional services and wholesale trade. Very strong growth in commercial mortgages of 24% ($1.3 billion) primarily reflected strong new lending volumes in British Columbia, Alberta and Ontario, with high-quality borrowers and underlying assets consistent with our risk appetite. Personal loans and mortgages increased 5% ($322 million) primarily due to residential A mortgage portfolio growth, which supports our participation in the National Housing Act Mortgage Backed Securities (NHA MBS) program. The equipment financing and leasing portfolio remained relatively consistent with last year as supply chain disruptions, increased competition in the low interest environment, and curtailed economic activity and capital projects persisted through most of fiscal 2021. Real estate project loans contracted 12% ($381 million), driven by successful project completions, primarily in British Columbia. Lending in real estate project loans has focused on the strongest tier of our risk appetite, which are borrowers with strong, resilient balance sheets and track records of completing similar projects. New project starts with these borrowers have been slow over the last two years, and we remain committed to our prudent risk appetite. We continue to lend into oil and gas production on a syndicated basis and maintain a proactive approach to manage our small portfolio in this space. The $219 million increase from last year reflected participation in syndications within our risk appetite. Our exposure to oil and gas production and service businesses each represent 1% of total loans. The shift in the mix of our portfolio (see Figure 2) reflected continued strategic execution as we capitalized on growth opportunities within our risk appetite across a broad range of industries through challenging economic and operating conditions. Very strong growth in commercial mortgages increased the proportion of loans in this category to 22% at October 31, 2021, compared to 19% last year. Strong growth in general commercial loans increased the proportion of loans to 33% at October 31, 2021, compared to 32% last year. The proportion of loans in equipment financing and leasing decreased to 16%, from 17% last year, and real estate project loans comprised 9% of the portfolio at year end, compared to 11% in 2020.
Figure 2 - Outstanding Loans by Portfolio (October 31, 2020 in brackets)
30 | CWB Financial Group 2021 Annual Report
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