CWBFG Annual Report 2023

SUMMARY OF QUARTERLY RESULTS AND FOURTH QUARTER QUARTERLY RESULTS

The financial results for each of the last eight quarters are summarized in Table 24. Detailed MD&A along with unaudited interim consolidated financial statements for each quarter, except for the fourth quarters, are available for review on SEDAR at www.sedarplus.ca and on our website at www.cwb.com. Copies of the quarterly reports to shareholders can also be obtained, free of charge, by contacting InvestorRelations@cwbank.com.

Table 24 - Quarterly Financial Highlights ($ thousands, except per share amounts)

2023

2022

Q4

Q3

Q2

Q1

Q4

Q3

Q2

Q1

Results from Operations Net interest income

$ 256,316

$ 252,158

$ 230,523

$ 242,280

$ 240,202

$ 240,593

$ 226,109

$ 233,072

Non-interest income

35,447 291,763 143,037 76,845

31,348 283,506 137,213 83,068

33,891 264,414 118,248 70,040

30,611 272,891 129,030 94,363

39,636 279,838 132,528 67,687

31,119 271,712 132,346 80,809

32,652 258,761 119,919 74,164

32,904 265,976 137,110 87,642

Total revenue

Pre-tax, pre-provision income Common shareholders' net income

Earnings per share Basic

0.80 0.80 0.94

0.86 0.86 0.88

0.73 0.73 0.74

0.99 0.99 1.02

0.72 0.72 0.88

0.88 0.88 0.90

0.82 0.82 0.84

0.98 0.97 0.99

Diluted

Adjusted

Return on common shareholders' equity

9.0 %

9.8 %

8.7 %

11.6 %

8.6 %

10.4 %

10.0 %

11.6 %

Adjusted return on common shareholders' equity

10.6 0.72 2.40 51.0

10.0 0.78 2.37 51.6

8.9

12.0 0.90 2.32 52.7

10.5 0.66 2.33 52.6

10.7 0.81 2.43 51.3

10.3 0.79 2.42 53.7

11.8 0.93 2.47 48.5

Return on assets Net interest margin

0.69 2.26 55.3

Efficiency ratio

Provision for credit losses on total loans as a percentage of average loans (1) Provision for credit losses on impaired loans as a percentage of average loans (1)

0.11

0.16

0.12

(0.09)

0.14

0.16

0.14

0.11

0.08

0.10

0.12

(0.12)

-

0.12

0.14

0.12

(1) Includes provisions for credit losses on loans, committed but undrawn credit exposures and letters of credit.

FOURTH QUARTER OF 2023 Q4 2023 VS. Q3 2023

Common shareholders’ net income of $77 million and diluted earnings per common share of $0.80 both decreased 7% primarily due to non-interest expenses incurred related to a reorganization of our operations late in the quarter. Adjusted common shareholders’ net income of $91 million and adjusted earnings per common share $0.94 increased 8% and 7%, respectively, as we benefited from higher revenues, lower provision for credit losses and prudent management of our expenses. Pre-tax, pre-provision income of $143 million was up 4%. Total revenue of $292 million grew 3%, which reflected a 2% increase in net interest income and a 13% increase in non-interest income. Net interest income of $256 million was driven by a three basis point improvement in net interest margin. Higher net interest margin reflected the benefit of increased yields on fixed term assets from higher market interest rates, which had a larger impact than the increase in deposit costs this quarter. Non-interest income growth reflected higher foreign exchange revenue recorded within ‘other’ non-interest income, partially offset by lower wealth management fees due to market value declines that reduced average assets under management. The provision for credit losses on total loans of 11 basis points was five basis points lower than last quarter. The performing loan provision for credit losses of three basis points declined by three basis points compared to last quarter and reflected continued uncertainty in the economic environment. The impaired loan provision of eight basis points declined two basis points from last quarter and remained below our historical five-year average. Non-interest expenses of $168 million were up 13% and included $17 million of costs incurred to execute reorganization initiatives to realize efficiencies in our banking centre footprint, operational support functions, and administrative processes. Adjusted non-interest expenses increased 2% and reflected higher capital taxes, and the impact of customary seasonal increases in certain expenses, including advertising and community investment costs, partially offset by actions undertaken during the year to carefully manage our staffing levels and limit discretionary expenditures to deliver positive operating leverage. We also benefitted from an SR&ED investment tax credit realized in the quarter.

CWB Financial Group 2023 Annual Report | 37

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