OTHER ASSETS AND OTHER LIABILITIES Other assets at October 31, 2023 totaled $1.0 billion and were relatively consistent with last year. Higher intangible asset balances associated with our continued investment in our digital capabilities were offset by lower accounts receivable balances. Other liabilities totaled $1.1 billion at October 31, 2023 compared to $1.2 billion last year, with the decrease primarily related to lower securities sold under repurchase agreements, partially offset by higher accounts payable balances and an increase in the liability recognized for unfavourable derivative contracts used for interest rate risk management purposes. LIQUIDITY MANAGEMENT We maintain a conservative liquid asset profile. Our cash and securities portfolio is comprised of high-quality debt instruments, primarily issued or guaranteed by federal (Canada or United States), provincial or municipal governments, and short-term money market instruments. A schedule outlining our securities portfolio at October 31, 2023 is provided in Note 4 of the audited consolidated financial statements. For additional information on the governance and risk management related to liquidity and funding risk, refer to the Liquidity and Funding Risk section of our MD&A.
Table 16 – Liquid Assets ($ thousands)
2023
2022 Change from 2022
Cash and non-interest bearing deposits with financial institutions
$
49,114 149,285 17,410 215,809 392,013
$
81,228 26,833
$
(32,114) 122,452
Interest bearing deposits with financial institutions
Cheques and other items in transit
7,918
9,492
115,979
99,830 392,013 (156,645) (886,347) (186,986) 40,990 382,016 (414,959) (315,129) 892,551
Government of Canada treasury bills
-
Government of Canada, provincial and municipal debt, term to maturity one year or less Government of Canada, provincial and municipal debt, term to maturity more than one year
1,895,269 1,421,507
2,051,914 2,307,854
NHA mortgage-backed securities (1)
42,066 200,017 134,662
229,052 159,027
Other securities
Securities (sold) purchased under (repurchase) resale agreements
(247,354) 4,500,493 4,616,472
4,085,534 4,301,343
Total Liquid Assets
$
$
$ $
Total Assets
$ 42,320,103
$ 41,427,552
Liquid Assets as a Percentage of Total Assets
10 %
11 %
(1) %
Total Cash and Securities
$
4,259,277
$
4,387,420
$
(128,143)
Cash and Securities as a Percentage of Total Assets
10 %
11 %
(1) %
Total Deposit Liabilities
$ 33,328,449
$ 33,010,462
$
317,987
Liquid Assets as a Percentage of Total Deposit Liabilities
13 %
14 %
(1) %
(1) Includes securitized mortgages that were not transferred to third parties. These are reported in loans at amortized cost on the consolidated balance sheets.
The composition of total liquid assets supports ongoing compliance with the OSFI Liquidity Adequacy Requirements (LAR) guideline. Liquid assets, as defined by OSFI, comprised of cash, deposits, securities (sold) purchased under (repurchase) resale agreements and marketable debt securities, totaled $4.3 billion at October 31, 2023 (October 31, 2022 – $4.6 billion). Liquid assets represented 10% of total assets, compared to 11% last year, and 13% of total deposit liabilities at year end, compared to 14% last year. The decline from last year was primarily driven by an increase in the proportion of insured term deposits of total deposits in the current year. Our liquidity management is based on an internal stressed cash flow model, with the level of cash and securities driven primarily by the term structure of both assets and liabilities, and the liquidity structure of liabilities. We continue to apply Guideline B-6: Liquidity Principles (Guideline B-6), which complements the LAR guideline and sets out OSFI’s expectations for how deposit-taking institutions should manage liquidity risk. In fiscal 2023, we continued to maintain very prudent levels of liquidity.
Other key elements of the composition of liquid assets at October 31, 2023 compared to the prior year include:
• Maturities within one year comprise 65% (October 31, 2022 – 42%), with the increase from the prior year in response to changes in market interest rates and continued economic uncertainty; • Government of Canada, provincial and municipal debt securities and unencumbered NHA MBS comprise 87% (October 31, 2022 – 99%); and, • Cash and deposits with financial institutions comprise 5% (October 31, 2022 – 3%).
32 | CWB Financial Group 2023 Annual Report
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