PROVISION FOR CREDIT LOSSES The provision for credit losses as a percentage of average loans of 14 basis points consisted of a ten basis point provision related to impaired loans and a four basis point provision related to performing loans. This compared to a nine basis point provision for credit losses last year, including a 17 basis point charge related to impaired loans and an eight basis point recovery related to performing loans. In dollar terms, the provision for credit losses of $46 million compared to $27 million last year. The provision for credit losses on impaired loans was a $32 million charge compared to a $51 million charge last year, while the provision for credit losses on performing loans was a $14 million charge compared to a recovery of $24 million last year. For additional information on the estimation of the performing loan allowance, refer to the Allowance for Credit Losses section of our MD&A.
Quarterly write-offs fluctuate as loans become impaired and are subsequently resolved. Our approach to managing credit risk has proven to be very effective and write-offs as a percentage of average loans of nine basis points remained well below our five-year average of 19 basis points.
Table 14 - Provision for Credit Losses (as a percentage of average loans)
IAS 39 (1)
IFRS 9
2022
2021
2020
2019
2018
Provision for credit losses on total loans
0.14 %
0.09 %
0.32 %
0.21 %
0.20 %
Provision for credit losses on impaired loans
0.10 0.09
0.17 0.19
0.18 0.17
0.21 0.23
0.19 0.18
Write-offs (2)
(1) Fiscal 2018 was prepared in accordance with IAS 39 Financial Instruments: Recognition and Measurement and have not been restated. (2) Non-GAAP measure – refer to definitions and detail provided on page 16.
PAST DUE LOANS Loans are considered past due when a customer has not made a payment by the contractual due date.
Table 15 - Past Due Loans
1 - 30 days
31 - 60 days
61 - 90 days
As at October 31, 2022
Total
Personal Business
$
62,119 $
28,338 $
1,152 $
91,609
112,008
48,970
45,845
206,823
Total
$
174,127 $
77,308 $
46,997 $
298,432
As at October 31, 2021
$
98,893 $
34,499 $
3,716 $
137,108
Past due performing loans of $298 million were 118% higher than prior year. Past due loans were at historical lows at the prior year-end. Over the last year borrower credit performance began to normalize. Past due performing loans as a percentage of total gross loans are now relatively consistent with pre-COVID-19 pandemic levels.
32 | CWB Financial Group 2022 Annual Report
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