- Diluted Q4 2015 earnings per share of $1.00; adjusted diluted earnings per share of
$1.02
- Planned share buyback of up to $150
million
- Quarterly dividend increased 9.1% or $0.02 per share, to $0.24 per common share, which would be
$0.96 on an annualized basis
TORONTO, Feb. 10, 2016 /CNW/ - Home Capital Group Inc.
(TSX: HCG) today reported financial results for the fourth quarter
and for 2015, a year in which the company made significant progress
strengthening its business in a prudent, profitable and sustainable
manner, and announced a dividend increase of 9.1% and a planned
$150 million share buyback.
In Q4 2015, Home Capital delivered an increased net interest
margin of 2.46%, from a healthy loan portfolio with low
non-performing loans and credit losses, continued progress on
improving the pace of loan originations, and a strong capital
position. In addition, the Company continued to execute on growth
initiatives, including closing the acquisition of CFF Bank, a
Schedule I bank under the Bank Act (Canada), fulfilling a strategic priority, and
the expansion of its credit card business with the launch of
another co-branded Visa product.
For 2015, Home Capital reported adjusted diluted earnings per
share in line with 2014's record level and near-record annual
adjusted net income and adjusted revenue. Total loans under
administration rose to $25.06
billion, the highest in the Company's history, driven by its
solid core residential business, increases in its Accelerator
portfolio, the acquisition of the CFF loans portfolio and increases
in commercial mortgages and other lending. In addition, the Company
continued to strengthen its balance sheet, invest in technology and
diversify deposit funding, important steps in creating a stronger
business.
Home Capital continues to expect that it will meet its three- to
five-year mid-term targets, reflecting the strength of the overall
business and its diverse sources of growth.
Q4 Financial Highlights:
- Adjusted Q4 2015 net income of $71.8
million and $288.9 million for
2015, down 0.1% compared to $71.9
million in Q4 2014 and down 0.1% compared to $289.2 million for 2015, respectively.
Adjusted Q4 2015 net income was 0.9% lower than Q3 2015.
- Adjusted Q4 2015 diluted earnings per share (EPS) of
$1.02 and $4.11 for 2015, compared to $1.02 and $4.11
earned in Q4 2014 and full year 2014, respectively. Adjusted
Q4 2015 diluted EPS was down 1.0% compared to Q3 2015.
- Adjusted Return on common shareholders' equity was 18.0% for Q4
2015 and 18.8% for 2015.
- Net non-performing loans as a percentage of gross loans (NPL
ratio) was 0.28% at the end of Q4 2015, compared to 0.30% at the
end of Q4 2014 and 0.30% at the end of Q3 2015.
- Net write-offs as a percentage of gross loans were 0.05% for Q4
2015, compared to 0.07% for Q4 2014 and 0.04% for Q3 2015.
Net write-offs for 2015 were 0.04% compared to 0.06% for
2014.
- Q4 2015 Common Equity Tier 1 ratio of 18.31% and Tier 1 and
Total capital ratios of 18.30% and 20.70%, respectively.
Growing Our Core Business
Home Capital, through its principal subsidiary Home Trust
Company, continued throughout 2015 to build on its presence as
Canada's leading alternative
financial institution serving an established, but underserved and
growing, market niche. The Company continued to make progress on
its efforts to increase originations of single-family residential
mortgages, and throughout the year has experienced strong growth in
its other lines of business.
Total mortgage advances in Q4 2015 were $2.15 billion, a decrease of 6.0% from
$2.29 billion in Q4 2014. Home
Capital reported traditional (uninsured single-family) residential
mortgage originations of $1.30
billion, as compared to $1.48
billion in Q4 2014, a decrease of 12.1%. Accelerator
originations increased 46.1% in Q4 2015 to $515.9 million from $353.0
million in Q4 2014. Originations from all other
sources decreased 26.3% to $334.0
million.
Total mortgage advances were down 13.8% over Q3 2015, reflecting
expected seasonality trends.
On a full-year basis, total mortgage originations from all
sources in 2015 were $8.06 billion,
down 8.9% from 2014, as increased commercial mortgage originations
helped to offset declines in traditional and Accelerator
residential mortgages.
For 2015, traditional residential originations decreased 13.5%
to $5.07 billion from $5.86 billion in 2014, while Accelerator
originations declined 22.0% to $1.39
billion in 2015 from $1.79
billion in 2014.
In Q2 2015, the Company disclosed that its mortgage origination
volumes were impacted directly by, among other things, the Company
suspending, during the period of September
2014 to March 2015, its
relationship with 18 independent mortgage brokers and 2 brokerages,
for a total of approximately 45 individual mortgage
brokers.
The total value of outstanding loans at December 31, 2015 that were referred by the
suspended brokers was $1.55 billion.
This compares to $1.72 billion
as at September 30, 2015. The
Company expects this balance to decline further as customers pay
down loans. The Company continues to actively monitor the
subject mortgages and notes that there have been no unusual credit
issues.
The Company is reviewing and re-validating, where appropriate,
the income documentation related to the identified group of
mortgages and taking corrective action accordingly. As of the
date of this report, the Company is over 40% of the way through its
review process, with plans to complete these efforts by the end of
2016. Of the accounts reviewed, the Company has determined
that approximately 90% of the mortgages reviewed to date could be
eligible for renewal.
Home Capital has taken several steps to improve origination
volumes in 2015 and in the initial part of 2016, including sales
measures to strengthen the Company's pipeline for residential
mortgage originations and to take advantage of the solid demand for
its traditional mortgages within its established regions. The
Company has taken additional steps to improve origination volumes
in the beginning of 2016 by enhancing the broker experience through
its broker portal technology, and launching a new broker
partnership program. In addition, the Company has renewed
focus on expanding its commercial lending products, seeking to
expand its footprint, as appropriate opportunities arise. The
Company expects to see further progress from these efforts to
improve origination volumes through 2016.
Other lending, comprising credit cards and other consumer retail
loans, continues to be an important source of loan assets with
attractive returns. These assets now represent 3.7% of the
total on-balance sheet loan portfolio, and generated 7.0% of the
interest income from loans for the quarter. The other lending
business demonstrated strong growth in 2015, despite
the payout of the waterheater loan portfolio of $234.9 million in 2014, which resulted in the
absence of net interest income of approximately $12.6 million ($9.3
million, after tax or $0.13
earnings per share) that would have been otherwise generated
through this portfolio in 2014.
The Company continued its expansion of its credit card
co-branding initiatives in Q4 2015, with the launch of a new
Visa credit card program co-branded with Giant Tiger. That
is in addition to two new programs announced in the third quarter
of 2015 with Union Plus Canada and Optimax. The Visa
cards are issued and managed by Home Trust. These credit card
programs leverage the brand, customer affinity and distribution
channels of these corporate partners.
The balance of Oaken deposits at the end of the year exceeded
$1 billion at $1.09 billion, reflecting an increase in the
balance over last year of 42.2%.
On October 1, 2015, the Company,
through its subsidiary Home Trust Company, finalized the
acquisition of all outstanding common shares of CFF Bank for a
purchase price of $19.6 million,
subject to final adjustments. The acquisition of CFF Bank, a
Schedule 1 bank under the Bank Act (Canada), supports the Company's long-term
strategy to continue to develop its deposit diversification
initiatives and potentially its product suite. In addition,
the Company has a mortgage and lending distribution agreement in
place with certain owner-managed Canadian First Financial Centres
that had a prior relationship with CFF Bank. These centres are
located across Canada, helping the
Company to expand its distribution networks.
Building on Operational Excellence
Home Capital continues to experience strong credit performance,
with net non-performing loans as a percentage of gross loans (NPL
ratio) at 0.28% at the end of Q4 2015, down from 0.30% at the end
of both Q3 2015 and Q4 2014. These results reflect the high credit
quality of the Company's loan portfolio and are supported by the
Company's continued investments in its risk oversight
functions.
Home Capital also continued through the end of 2015 to make
disciplined and measured investments in other areas related to the
longer-term growth of the business. These investments include,
among other things, ongoing investments in IT related to moving
toward operating as a digital enterprise, as well as continuing to
update the Company's loans-origination platform, which is designed
for more efficient processing of loan applications.
The integration of CFF Bank with the Company's own operations is
proceeding as expected. All retained former employees of CFF Bank
have been transitioned to Home Trust. The Company is beginning the
initial stages of decommissioning redundant systems to realize
planned cost savings and to facilitate the efficient growth of the
CFF business. The Company incurred acquisition and integration
expenses in the quarter related to CFF Bank in the amount of
$4.2 million. These amounts
have been excluded in the calculation of adjusted metrics.
While most of the increase in expenses incurred by the Company
in 2015 were associated with ongoing efforts to build on Home
Capital's operational excellence and dedication to providing
service to clients and business partners, the Company has incurred
additional expenses of approximately $2.9
million in 2015 related to its efforts to realign some of
its business partnerships following the suspension of the small
number of brokers.
Strong and Conservative Financial Position
Home Capital continued to focus on maintaining its strong and
conservative financial position while delivering value to
shareholders in Q4 2015 and the full year 2015. Home Capital
delivered an adjusted return on average shareholders' equity of
18.0% and 18.8%, respectively.
Subsequent to the end of the quarter, and in light of the
Company's performance, profitability and strong financial position,
the Board of Directors approved a quarterly dividend of
$0.24 per common share, payable on
March 1, 2016 to shareholders of
record at the close of business on February
23, 2016. The dividend increase marks Home Capital's
18th increase to its common share dividend in the last 10
years.
In addition, Home Capital Group's Board of Directors has
authorized a share repurchase of up to $150
million, which is anticipated to take place through a
Substantial Issuer Bid by way of an issuer bid circular that would
be provided to the shareholders of Home Capital. Home Capital
has engaged RBC Capital Markets as its financial advisor in
connection with the proposed Substantial Issuer Bid. The
terms and conditions of the bid remain to be determined, and are
subject to approval by the Board of Directors. The Company
will provide additional details regarding the share repurchase in
due course.
In summary, the Company has maintained its solid fundamentals,
and has seen improvements in originations through the end of 2015.
Home Capital's focus remains on providing the best service and
support to our customers and valued business partners, generating
future growth that is sustainable and prudent, and making the
investments in our business that help us to achieve those
goals.
Looking ahead, the Board of Directors and management expect that
Home Capital will continue generating solid shareholder returns for
2016 and beyond.
(signed)
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(signed)
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|
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|
GERALD M.
SOLOWAY
|
|
|
|
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KEVIN P.D.
SMITH
|
Chief Executive
Officer
|
|
|
|
|
|
Chair of the
Board
|
February 10,
2016
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The Company's 2015 Annual and Fourth Quarter Consolidated
Financial Report, including Management's Discussion and Analysis,
for each of the three- and twelve-month periods ended December 31, 2015 is available at
www.homecapital.com and on the Canadian Securities Administrators'
website at www.sedar.com.
Conference Call and Webcast
Fourth Quarter Results Conference Call
The conference call will take place on Thursday, February 11, 2016, at 10:30 a.m. Participants are asked to call 5 to 15
minutes in advance, 647-427-7450 in Toronto or toll-free 1-888-231-8191 throughout
North America. The call will also
be accessible in listen-only mode via the Internet at
www.homecapital.com.
Conference Call Archive
A telephone replay of the call will be available between
1:30 p.m. Thursday, February 11, 2016
and midnight Thursday, February 18,
2016 by calling 416-849-0833 or 1-855-859-2056 (enter
passcode 30647595). The archived audio web cast will be available
for 90 days on CNW Group's website at www.newswire.ca and Home
Capital's website at www.homecapital.com.
Annual Meeting Notice
The Annual Meeting of Shareholders of Home Capital Group Inc.
will be held at One King West, Grand Banking Hall, Toronto, Ontario, M5H 1A1, on Wednesday, May 11, 2016 at 11:00 a.m. local time. Shareholders and guests
are invited to join Directors and Management for lunch and
refreshments following the Annual Meeting. All shareholders are
encouraged to attend.
Financial
Highlights
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
For the year
ended
|
|
December
31
|
September
30
|
December
31
|
December
31
|
December
31
|
(000s, except
Percentage, Multiples, and Per Share Amounts)
|
|
2015
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
OPERATING
RESULTS
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
$
|
70,239
|
$
|
72,443
|
$
|
95,936
|
$
|
287,285
|
$
|
313,172
|
Adjusted Net
Income1
|
|
71,811
|
|
72,443
|
|
71,917
|
|
288,857
|
|
289,153
|
Net Interest
Income
|
|
126,658
|
|
121,698
|
|
116,416
|
|
481,090
|
|
459,529
|
Total Adjusted
Revenue1
|
|
246,406
|
|
247,194
|
|
251,917
|
|
993,711
|
|
1,010,311
|
Diluted Earnings per
Share
|
$
|
1.00
|
$
|
1.03
|
$
|
1.36
|
$
|
4.09
|
$
|
4.45
|
Adjusted Diluted
Earnings per Share1
|
$
|
1.02
|
$
|
1.03
|
$
|
1.02
|
$
|
4.11
|
$
|
4.11
|
Return on
Shareholders' Equity
|
|
17.6%
|
|
18.7%
|
|
27.2%
|
|
18.7%
|
|
23.8%
|
Adjusted Return on
Shareholders' Equity1
|
|
18.0%
|
|
18.7%
|
|
20.4%
|
|
18.8%
|
|
22.0%
|
Return on Average
Assets
|
|
1.4%
|
|
1.4%
|
|
1.9%
|
|
1.4%
|
|
1.6%
|
Net Interest Margin
(TEB)2
|
|
2.46%
|
|
2.38%
|
|
2.27%
|
|
2.36%
|
|
2.25%
|
Provision as a
Percentage of Gross Uninsured Loans (annualized)
|
|
0.04%
|
|
0.08%
|
|
0.09%
|
|
0.06%
|
|
0.10%
|
Provision as a
Percentage of Gross Loans (annualized)
|
|
0.03%
|
|
0.06%
|
|
0.07%
|
|
0.05%
|
|
0.07%
|
Efficiency Ratio
(TEB)2
|
|
36.0%
|
|
30.8%
|
|
22.9%
|
|
32.4%
|
|
27.2%
|
Adjusted Efficiency
Ratio (TEB)1,2
|
|
33.7%
|
|
30.8%
|
|
28.2%
|
|
31.8%
|
|
28.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at
|
|
|
|
|
|
December
31
|
September
30
|
December
31
|
|
|
|
|
|
|
2015
|
|
2015
|
|
2014
|
|
|
|
|
BALANCE SHEET
HIGHLIGHTS
|
|
|
|
|
|
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|
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|
Total
Assets
|
$
|
20,512,019
|
$
|
20,314,220
|
$
|
20,082,744
|
|
|
|
|
Total Assets Under
Administration3
|
|
27,301,433
|
|
25,404,219
|
|
24,281,366
|
|
|
|
|
Total
Loans4
|
|
18,268,708
|
|
18,336,736
|
|
18,364,910
|
|
|
|
|
Total Loans Under
Administration3,4
|
|
25,058,122
|
|
23,426,735
|
|
22,563,532
|
|
|
|
|
Liquid
Assets
|
|
2,095,145
|
|
1,477,493
|
|
1,058,297
|
|
|
|
|
Deposits
|
|
15,665,958
|
|
14,949,842
|
|
13,939,971
|
|
|
|
|
Shareholders'
Equity
|
|
1,621,106
|
|
1,569,230
|
|
1,448,633
|
|
|
|
|
FINANCIAL
STRENGTH
|
|
|
|
|
|
|
|
|
|
|
Capital
Measures5
|
|
|
|
|
|
|
|
|
|
|
Risk-Weighted
Assets
|
$
|
7,985,498
|
$
|
7,797,987
|
$
|
7,186,132
|
|
|
|
|
Common Equity Tier 1
Capital Ratio
|
|
18.31%
|
|
18.06%
|
|
18.30%
|
|
|
|
|
Tier 1 Capital
Ratio
|
|
18.30%
|
|
18.06%
|
|
18.30%
|
|
|
|
|
Total Capital
Ratio
|
|
20.70%
|
|
20.51%
|
|
20.94%
|
|
|
|
|
Leverage
Ratio6
|
|
7.36%
|
|
7.17%
|
|
N/A
|
|
|
|
|
Credit
Quality
|
|
|
|
|
|
|
|
|
|
|
Net Non-Performing
Loans as a Percentage of Gross Loans
|
|
0.28%
|
|
0.30%
|
|
0.30%
|
|
|
|
|
Allowance as a
Percentage of Gross Non-Performing Loans
|
|
74.0%
|
|
69.4%
|
|
64.4%
|
|
|
|
|
Share
Information
|
|
|
|
|
|
|
|
|
|
|
Book Value per Common
Share
|
$
|
23.17
|
$
|
22.37
|
$
|
20.67
|
|
|
|
|
Common Share Price –
Close
|
$
|
26.92
|
$
|
32.03
|
$
|
47.99
|
|
|
|
|
Dividend paid during
the period ended
|
$
|
0.22
|
$
|
0.22
|
$
|
0.20
|
|
|
|
|
Market
Capitalization
|
$
|
1,883,808
|
$
|
2,247,225
|
$
|
3,363,907
|
|
|
|
|
Number of Common
Shares Outstanding
|
|
69,978
|
|
70,160
|
|
70,096
|
|
|
|
|
1 See
definition of Adjusted Net Income, Total Adjusted Revenue, Adjusted
Diluted Earnings per Share, Adjusted Return on Shareholders' Equity
and Adjusted Efficiency Ratio under Non-GAAP Measures in the
Company's 2015 Annual and Fourth Quarter consolidated financial
report and the Reconciliation of Net Income to Adjusted Net Income
in the following table.
|
2 See
definition of Taxable Equivalent Basis (TEB) under Non-GAAP
Measures in the Company's 2015 Annual and Fourth Quarter
consolidated financial report.
|
3 Total
assets and loans under administration include both on- and
off-balance sheet amounts.
|
4 Total
loans include loans held for sale.
|
5 These
figures relate to the Company's operating subsidiary, Home Trust
Company.
|
6
Effective Q1 2015, the Assets to Regulatory Capital Multiple has
been replaced with the Basel III Leverage ratio. See
definition of the leverage ratio under Non-GAAP Measures in the
Company's 2015 Annual and Fourth Quarter consolidated financial
report.
|
Reconciliation of
Net Income to Adjusted Net Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
|
Year
|
(000s, except %
and per share amounts)
|
Q4
|
Q3
|
%
|
Q4
|
%
|
|
|
%
|
|
|
2015
|
2015
|
Change
|
2014
|
Change
|
2015
|
2014
|
Change
|
Net income under
GAAP
|
$
|
70,239
|
$
|
72,443
|
(3.0)%
|
$
|
95,936
|
(26.8)%
|
$
|
287,285
|
$
|
313,172
|
(8.3)%
|
Adjustment for
acquisition and integration costs, net of gain recognized on
acquisition of CFF Bank (net of tax)
|
|
1,572
|
|
-
|
-
|
|
-
|
-
|
|
1,572
|
|
-
|
-
|
Adjustment for
prepayment income on portfolio sale (net of tax)
|
|
-
|
|
-
|
-
|
|
(24,019)
|
(100.0)%
|
|
-
|
|
(24,019)
|
(100.0)%
|
Adjusted Net
Income1
|
$
|
71,811
|
$
|
72,443
|
(0.9)%
|
$
|
71,917
|
(0.1)%
|
$
|
288,857
|
$
|
289,153
|
(0.1)%
|
Adjusted Basic
Earnings per Share1
|
$
|
1.02
|
$
|
1.03
|
(1.0)%
|
$
|
1.03
|
(1.0)%
|
$
|
4.12
|
$
|
4.14
|
(0.5)%
|
Adjusted Diluted
Earnings per Share1
|
$
|
1.02
|
$
|
1.03
|
(1.0)%
|
$
|
1.02
|
-
|
$
|
4.11
|
$
|
4.11
|
-
|
1 Adjusted
Net Income and Adjusted Earnings per share are defined in the
Non-GAAP section of the Company's 2015 Annual and Fourth Quarter
Consolidated Financial Report.
|
The Company's results were affected by the following items of
note that aggregated to a negative impact of $1.6 million and $0.02 diluted earnings per share in both Q4 2015
and 2015:
- $0.7 million in acquisition
costs, $3.5 million in integration
costs, and $2.1 million in relation
to a bargain purchase gain for a total of $2.1 million related to the acquisition of CFF
Bank in 2015 ($1.6 million, after tax
and $0.02 diluted earnings per
share).
The Company's results were affected by the following items of
note in Q4 2014 and the year ended 2014:
- $32.7 million prepayment income
in Q4 2014 ($24.0 million, after tax
and $0.34 diluted earnings per share)
related to the prepayment of $234.9
million of water heater loans.
2015 Performance Summary
Below is a summary of the Company's performance for 2015 against
the mid-term targets. The Company will continue to focus on
its medium-term objectives to guide the Company's decision-making
and describe its accomplishments.
- Diluted earnings per share (adjusted) were $4.11 for 2015. The Company's goal is to
achieve, average annualized growth in diluted earnings (adjusted)
per share of 8% to 13% in the three- to five-year medium term.
- Return on shareholders' equity (adjusted) was 18.8% for
2015, with the goal to achieve on average annualized return on
equity of greater than 16% in the three- to five-year medium
term. This objective was revised during the fourth quarter of
2015.
- Common Equity Tier 1 and Tier 1 capital ratios of 18.31% and
18.30%, respectively, and Total capital ratio of 20.70% continue to
be well in excess of regulatory minimums.
- Dividend payout ratio of 22.0%, with a targeted payout on
average of 19% to 26% of earnings to shareholders in the three- to
five-year medium term.
On annual basis, the Company will update its three year
financial plan and evaluate targets as part of its year-end process
or as required.
Consolidated
Balance Sheets
|
|
|
|
|
|
|
|
|
|
|
|
As at
|
|
|
|
December
31
|
|
September
30
|
|
December
31
|
thousands of
Canadian dollars
|
|
2015
|
|
2015
|
|
2014
|
ASSETS
|
|
|
|
|
|
|
Cash and Cash
Equivalents
|
$
|
1,149,849
|
$
|
612,218
|
$
|
360,746
|
Available for Sale
Securities
|
|
453,230
|
|
413,381
|
|
582,819
|
Loans Held for
Sale
|
|
135,043
|
|
162,432
|
|
102,094
|
Loans
|
|
|
|
|
|
|
Securitized
mortgages
|
|
2,674,475
|
|
2,900,586
|
|
3,945,654
|
Non-securitized
mortgages and loans
|
|
15,459,190
|
|
15,273,718
|
|
14,317,162
|
|
|
18,133,665
|
|
18,174,304
|
|
18,262,816
|
Collective allowance
for credit losses
|
|
(36,249)
|
|
(35,900)
|
|
(34,100)
|
|
|
18,097,416
|
|
18,138,404
|
|
18,228,716
|
Other
|
|
|
|
|
|
|
Restricted
assets
|
|
195,921
|
|
494,133
|
|
421,083
|
Derivative
assets
|
|
64,796
|
|
77,875
|
|
38,534
|
Other
assets
|
|
287,417
|
|
292,331
|
|
235,616
|
Goodwill and
intangible assets
|
|
128,347
|
|
123,446
|
|
113,136
|
|
|
|
676,481
|
|
987,785
|
|
808,369
|
|
$
|
20,512,019
|
$
|
20,314,220
|
$
|
20,082,744
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Deposits
|
|
|
|
|
|
|
Deposits payable on
demand
|
$
|
1,986,136
|
$
|
1,562,081
|
$
|
1,064,152
|
Deposits payable on a
fixed date
|
|
13,679,822
|
|
13,387,761
|
|
12,875,819
|
|
|
15,665,958
|
|
14,949,842
|
|
13,939,971
|
Senior
Debt
|
|
151,480
|
|
153,652
|
|
152,026
|
Securitization
Liabilities
|
|
|
|
|
|
|
Mortgage-backed
security liabilities
|
|
531,326
|
|
327,837
|
|
471,551
|
Canada Mortgage Bond
liabilities
|
|
2,249,230
|
|
2,990,281
|
|
3,831,912
|
|
|
2,780,556
|
|
3,318,118
|
|
4,303,463
|
Other
|
|
|
|
|
|
|
Derivative
liabilities
|
|
5,447
|
|
2,992
|
|
2,266
|
Other
liabilities
|
|
264,941
|
|
283,421
|
|
199,831
|
Deferred tax
liabilities
|
|
22,531
|
|
37,035
|
|
36,554
|
|
|
292,919
|
|
323,378
|
|
238,651
|
|
|
|
18,890,913
|
|
18,744,990
|
|
18,634,111
|
Shareholders'
Equity
|
|
|
|
|
|
|
Capital
stock
|
|
90,247
|
|
89,683
|
|
84,687
|
Contributed
surplus
|
|
3,965
|
|
3,775
|
|
3,989
|
Retained
earnings
|
|
1,592,438
|
|
1,544,620
|
|
1,378,562
|
Accumulated other
comprehensive loss
|
|
(65,544)
|
|
(68,848)
|
|
(18,605)
|
|
|
1,621,106
|
|
1,569,230
|
|
1,448,633
|
|
$
|
20,512,019
|
$
|
20,314,220
|
$
|
20,082,744
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Statements of Income
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
|
For the year
ended
|
|
|
December
31
|
|
September
30
|
|
December
31
|
|
December
31
|
|
December
31
|
thousands of
Canadian dollars, except per share amounts
|
|
2015
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Net Interest
Income Non-Securitized Assets
|
|
|
|
|
|
|
|
|
|
|
Interest from
loans
|
$
|
197,052
|
$
|
195,051
|
$
|
187,272
|
$
|
769,562
|
$
|
717,798
|
Dividends from
securities
|
|
2,608
|
|
2,597
|
|
2,842
|
|
10,620
|
|
11,426
|
Other
interest
|
|
1,694
|
|
1,846
|
|
2,482
|
|
7,951
|
|
13,912
|
|
|
201,354
|
|
199,494
|
|
192,596
|
|
788,133
|
|
743,136
|
Interest on deposits
and other
|
|
77,762
|
|
80,771
|
|
81,326
|
|
318,597
|
|
311,494
|
Interest on senior
debt
|
|
1,824
|
|
1,512
|
|
1,660
|
|
6,396
|
|
6,392
|
Net interest income
non-securitized assets
|
|
121,768
|
|
117,211
|
|
109,610
|
|
463,140
|
|
425,250
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest
Income Securitized Loans and Assets
|
|
|
|
|
|
|
|
|
|
|
Interest income from
securitized loans and assets
|
|
22,853
|
|
24,315
|
|
35,559
|
|
103,841
|
|
166,491
|
Interest expense on
securitization liabilities
|
|
17,963
|
|
19,828
|
|
28,753
|
|
85,891
|
|
132,212
|
Net interest income
securitized loans and assets
|
|
4,890
|
|
4,487
|
|
6,806
|
|
17,950
|
|
34,279
|
|
|
|
|
|
|
|
|
|
|
|
Total Net Interest
Income
|
|
126,658
|
|
121,698
|
|
116,416
|
|
481,090
|
|
459,529
|
Provision for credit
losses
|
|
1,415
|
|
2,849
|
|
3,186
|
|
8,933
|
|
13,134
|
|
|
125,243
|
|
118,849
|
|
113,230
|
|
472,157
|
|
446,395
|
Non-Interest
Income
|
|
|
|
|
|
|
|
|
|
|
Fees and other
income
|
|
19,927
|
|
20,096
|
|
18,272
|
|
82,632
|
|
71,241
|
Securitization
income
|
|
5,760
|
|
5,788
|
|
4,956
|
|
26,208
|
|
26,845
|
Prepayment income on
portfolio sale
|
|
-
|
|
-
|
|
32,675
|
|
-
|
|
32,675
|
Gain on acquisition
of CFF Bank
|
|
2,056
|
|
-
|
|
-
|
|
2,056
|
|
-
|
Net realized and
unrealized (losses) gains on securities
|
|
(66)
|
|
(542)
|
|
965
|
|
836
|
|
3,425
|
Net realized and
unrealized loss on derivatives
|
|
(3,422)
|
|
(1,957)
|
|
(431)
|
|
(7,939)
|
|
(827)
|
|
|
24,255
|
|
23,385
|
|
56,437
|
|
103,793
|
|
133,359
|
|
|
149,498
|
|
142,234
|
|
169,667
|
|
575,950
|
|
579,754
|
|
|
|
|
|
|
|
|
|
|
|
Non-Interest
Expenses
|
|
|
|
|
|
|
|
|
|
|
Salaries and
benefits
|
|
25,874
|
|
19,382
|
|
20,156
|
|
88,873
|
|
80,769
|
Premises
|
|
2,731
|
|
3,149
|
|
3,213
|
|
12,274
|
|
11,866
|
Other operating
expenses
|
|
26,076
|
|
22,424
|
|
16,520
|
|
89,526
|
|
69,617
|
|
|
54,681
|
|
44,955
|
|
39,889
|
|
190,673
|
|
162,252
|
|
|
|
|
|
|
|
|
|
|
|
Income Before
Income Taxes
|
|
94,817
|
|
97,279
|
|
129,778
|
|
385,277
|
|
417,502
|
Income
taxes
|
|
|
|
|
|
|
|
|
|
|
|
Current
|
|
25,548
|
|
23,189
|
|
32,539
|
|
98,481
|
|
102,201
|
|
Deferred
|
|
(970)
|
|
1,647
|
|
1,303
|
|
(489)
|
|
2,129
|
|
|
24,578
|
|
24,836
|
|
33,842
|
|
97,992
|
|
104,330
|
NET
INCOME
|
$
|
70,239
|
$
|
72,443
|
$
|
95,936
|
$
|
287,285
|
$
|
313,172
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME PER
COMMON SHARE
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
1.00
|
$
|
1.03
|
$
|
1.37
|
$
|
4.09
|
$
|
4.48
|
Diluted
|
$
|
1.00
|
$
|
1.03
|
$
|
1.36
|
$
|
4.09
|
$
|
4.45
|
AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
70,157
|
|
70,218
|
|
70,101
|
|
70,170
|
|
69,857
|
Diluted
|
|
70,237
|
|
70,380
|
|
70,462
|
|
70,323
|
|
70,432
|
|
|
|
|
|
|
|
|
|
|
|
Total number of
outstanding common shares
|
|
69,978
|
|
70,160
|
|
70,096
|
|
69,978
|
|
70,096
|
Book value per common
share
|
$
|
23.17
|
$
|
22.37
|
$
|
20.67
|
$
|
23.17
|
$
|
20.67
|
|
|
|
|
|
|
|
|
|
Consolidated
Statements of Comprehensive Income
|
|
|
|
|
|
|
For the three months
ended
|
|
For the year
ended
|
|
December
31
|
September
30
|
December
31
|
December
31
|
December
31
|
thousands of
Canadian dollars
|
2015
|
2015
|
2014
|
2015
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME
|
$
|
70,239
|
$
|
72,443
|
$
|
95,936
|
$
|
287,285
|
$
|
313,172
|
|
|
|
|
|
|
|
|
|
|
|
OTHER
COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available for Sale
Securities and Retained Interests
|
|
|
|
|
|
|
|
|
|
|
Net unrealized gains
(losses)
|
|
6,171
|
|
(29,730)
|
|
(3,862)
|
|
(61,991)
|
|
2,854
|
Net losses (gains)
reclassified to net income
|
|
66
|
|
460
|
|
(965)
|
|
(917)
|
|
(3,425)
|
|
|
6,237
|
|
(29,270)
|
|
(4,827)
|
|
(62,908)
|
|
(571)
|
Income tax expense
(recovery)
|
|
1,654
|
|
(7,760)
|
|
(1,279)
|
|
(16,684)
|
|
(152)
|
|
|
4,583
|
|
(21,510)
|
|
(3,548)
|
|
(46,224)
|
|
(419)
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flow
Hedges
|
|
|
|
|
|
|
|
|
|
|
Net unrealized
(losses) gains
|
|
(2,110)
|
|
130
|
|
(608)
|
|
(2,449)
|
|
(1,061)
|
Net losses
reclassified to net income
|
|
369
|
|
369
|
|
365
|
|
1,474
|
|
1,461
|
|
|
(1,741)
|
|
499
|
|
(243)
|
|
(975)
|
|
400
|
Income tax (recovery)
expense
|
|
(462)
|
|
133
|
|
(64)
|
|
(260)
|
|
107
|
|
|
(1,279)
|
|
366
|
|
(179)
|
|
(715)
|
|
293
|
|
|
|
|
|
|
|
|
|
|
|
Total other
comprehensive income (loss)
|
|
3,304
|
|
(21,144)
|
|
(3,727)
|
|
(46,939)
|
|
(126)
|
|
|
|
|
|
|
|
|
|
|
|
COMPREHENSIVE
INCOME
|
$
|
73,543
|
$
|
51,299
|
$
|
92,209
|
$
|
240,346
|
$
|
313,046
|
|
|
|
Consolidated
Statements of Changes in Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Unrealized
|
|
|
|
|
|
|
|
Losses
|
Net
Unrealized
|
Total
|
|
|
|
|
|
on Securities
and
|
Losses on
|
Accumulated
|
|
|
|
|
|
Retained
|
Cash Flow
|
Other
|
Total
|
thousands of
Canadian dollars,
|
Capital
|
Contributed
|
Retained
|
Interests
Available
|
Hedges,
|
Comprehensive
|
Shareholders'
|
except per share
amounts
|
Stock
|
Surplus
|
Earnings
|
for Sale, After
Tax
|
After Tax
|
Loss
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at
December 31, 2014
|
$
|
84,687
|
$
|
3,989
|
$
|
1,378,562
|
$
|
(16,242)
|
$
|
(2,363)
|
$
|
(18,605)
|
$
|
1,448,633
|
Comprehensive
income
|
|
-
|
|
-
|
|
287,285
|
|
(46,224)
|
|
(715)
|
|
(46,939)
|
|
240,346
|
Stock options
settled
|
|
6,002
|
|
(1,605)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
4,397
|
Amortization of
fair value of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
employee stock
options
|
|
-
|
|
1,581
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,581
|
Repurchase of
shares
|
|
(442)
|
|
-
|
|
(10,270)
|
|
-
|
|
-
|
|
-
|
|
(10,712)
|
Dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($0.88 per
share)
|
|
-
|
|
-
|
|
(63,139)
|
|
-
|
|
-
|
|
-
|
|
(63,139)
|
Balance at
December 31, 2015
|
$
|
90,247
|
$
|
3,965
|
$
|
1,592,438
|
$
|
(62,466)
|
$
|
(3,078)
|
$
|
(65,544)
|
$
|
1,621,106
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December
31, 2013
|
$
|
70,233
|
$
|
5,984
|
$
|
1,119,959
|
$
|
(15,823)
|
$
|
(2,656)
|
$
|
(18,479)
|
$
|
1,177,697
|
Comprehensive
income
|
|
-
|
|
-
|
|
313,172
|
|
(419)
|
|
293
|
|
(126)
|
|
313,046
|
Stock options
settled
|
|
14,488
|
|
(3,895)
|
|
-
|
|
-
|
|
-
|
|
-
|
|
10,593
|
Amortization of fair
value of
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
employee stock
options
|
|
-
|
|
1,900
|
|
-
|
|
-
|
|
-
|
|
-
|
|
1,900
|
Repurchase of
shares
|
|
(34)
|
|
-
|
|
(1,356)
|
|
-
|
|
-
|
|
-
|
|
(1,390)
|
Dividends
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
($0.70 per
share)
|
|
-
|
|
-
|
|
(53,213)
|
|
-
|
|
-
|
|
-
|
|
(53,213)
|
Balance at December
31, 2014
|
$
|
84,687
|
$
|
3,989
|
$
|
1,378,562
|
$
|
(16,242)
|
$
|
(2,363)
|
$
|
(18,605)
|
$
|
1,448,633
|
|
|
|
Consolidated
Statements of Cash Flows
|
|
For the three months
ended
|
For the year
ended
|
|
|
December
31
|
|
December
31
|
|
December
31
|
|
December
31
|
thousands of
Canadian dollars
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
Net income for the
year
|
$
|
70,239
|
$
|
95,936
|
$
|
287,285
|
$
|
313,172
|
Adjustments to
determine cash flows relating to operating activities:
|
|
|
|
|
|
|
|
|
|
Amortization of net
(discount) premium on securities
|
|
(221)
|
|
(514)
|
|
(169)
|
|
1,001
|
|
Provision for credit
losses
|
|
1,415
|
|
3,186
|
|
8,933
|
|
13,134
|
|
Prepayment income on
portfolio sale
|
|
-
|
|
(32,675)
|
|
-
|
|
(32,675)
|
|
Gain on acquisition
of CFF Bank
|
|
(2,056)
|
|
-
|
|
(2,056)
|
|
-
|
|
Gain on sale of
mortgages or residual interest
|
|
(4,728)
|
|
(4,362)
|
|
(21,412)
|
|
(23,712)
|
|
Net realized and
unrealized gains on securities
|
|
66
|
|
(965)
|
|
(836)
|
|
(3,425)
|
|
Amortization of
capital and intangible assets
|
|
2,918
|
|
868
|
|
12,922
|
|
10,387
|
|
Amortization of fair
value of employee stock options
|
|
418
|
|
376
|
|
1,581
|
|
1,900
|
|
Deferred income
taxes
|
|
(970)
|
|
1,303
|
|
(489)
|
|
2,129
|
Changes in operating
assets and liabilities
|
|
|
|
|
|
|
|
|
|
Loans, net of
securitization and sales
|
|
165,761
|
|
158,268
|
|
205,412
|
|
(299,376)
|
|
Restricted
assets
|
|
302,883
|
|
245,557
|
|
229,833
|
|
227,200
|
|
Derivative assets and
liabilities
|
|
13,844
|
|
(5,275)
|
|
(24,075)
|
|
(9,791)
|
|
Accrued interest
receivable
|
|
495
|
|
(505)
|
|
1,319
|
|
(1,951)
|
|
Accrued interest
payable
|
|
(10,146)
|
|
(23,535)
|
|
4,399
|
|
60
|
|
Deposits
|
|
514,361
|
|
(82,161)
|
|
1,524,232
|
|
1,174,017
|
|
Securitization
liabilities
|
|
(557,308)
|
|
(422,698)
|
|
(1,542,653)
|
|
(1,469,601)
|
|
Taxes receivable or
payable and other
|
|
(11,072)
|
|
(43,069)
|
|
20,358
|
|
(41,867)
|
Cash flows provided
by (used in) operating activities
|
|
485,899
|
|
(110,265)
|
|
704,584
|
|
(139,398)
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Repurchase of
shares
|
|
(7,334)
|
|
(618)
|
|
(10,712)
|
|
(1,390)
|
Exercise of employee
stock options
|
|
638
|
|
101
|
|
4,397
|
|
10,593
|
Dividends paid to
shareholders
|
|
(15,429)
|
|
(14,020)
|
|
(61,763)
|
|
(48,922)
|
Cash flows used in
financing activities
|
|
(22,125)
|
|
(14,537)
|
|
(68,078)
|
|
(39,719)
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
Activity in
securities
|
|
|
|
|
|
|
|
|
|
Purchases
|
|
(35,020)
|
|
(42,482)
|
|
(35,020)
|
|
(542,558)
|
|
Proceeds from
sales
|
|
-
|
|
32,617
|
|
76,924
|
|
206,020
|
|
Proceeds from
maturities
|
|
1,618
|
|
20,135
|
|
25,350
|
|
178,772
|
Acquisition of CFF
Bank, net of cash acquired
|
|
115,892
|
|
-
|
|
115,892
|
|
-
|
Purchases of capital
assets
|
|
(1,628)
|
|
(1,063)
|
|
(5,302)
|
|
(3,080)
|
Capitalized
intangible development costs
|
|
(7,006)
|
|
(11,760)
|
|
(25,247)
|
|
(32,463)
|
Cash flows provided
by (used in) investing activities
|
|
73,856
|
|
(2,553)
|
|
152,597
|
|
(193,309)
|
Net increase
(decrease) in cash and cash equivalents during the year
|
|
537,630
|
|
(127,355)
|
|
789,103
|
|
(372,426)
|
Cash and cash
equivalents at beginning of the period
|
|
612,219
|
|
488,101
|
|
360,746
|
|
733,172
|
Cash and Cash
Equivalents at End of the Period
|
$
|
1,149,849
|
$
|
360,746
|
$
|
1,149,849
|
$
|
360,746
|
Supplementary
Disclosure of Cash Flow Information
|
|
|
|
|
|
|
|
|
Dividends received on
investments
|
$
|
4,342
|
$
|
2,607
|
$
|
11,656
|
$
|
9,750
|
Interest
received
|
|
220,787
|
|
224,528
|
|
881,749
|
|
895,851
|
Interest
paid
|
|
109,628
|
|
137,208
|
|
406,485
|
|
450,038
|
Income taxes
paid
|
|
26,374
|
|
20,821
|
|
128,763
|
|
81,320
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Interest
Margin
|
|
For the three months
ended
|
For the year
ended
|
|
December
31
|
September
30
|
December
31
|
December
31
|
December
31
|
|
2015
|
2015
|
2014
|
2015
|
2014
|
Net interest margin
non-securitized interest earning assets (non-TEB)
|
2.87%
|
2.80%
|
2.77%
|
2.80%
|
2.80%
|
Net interest margin
non-securitized interest earning assets (TEB)
|
2.89%
|
2.83%
|
2.79%
|
2.83%
|
2.83%
|
Net interest margin
securitized assets
|
0.60%
|
0.52%
|
0.60%
|
0.49%
|
0.67%
|
Total net interest
margin (non-TEB)
|
2.45%
|
2.36%
|
2.25%
|
2.34%
|
2.23%
|
Total net interest
margin (TEB)
|
2.46%
|
2.38%
|
2.27%
|
2.36%
|
2.25%
|
Spread of
non-securitized loans over deposits and other
|
2.97%
|
2.93%
|
2.83%
|
2.91%
|
2.93%
|
Net Interest
Income by Product and Average Rate
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
|
December 31,
2015
|
September 30,
2015
|
December 31,
2014
|
(000s, except
%)
|
|
Income/
|
Average
|
|
Income/
|
Average
|
|
Income/
|
Average
|
|
|
Expense
|
Rate
1
|
|
Expense
|
Rate
1
|
|
Expense
|
Rate
1
|
Interest-bearing
assets
|
|
|
|
|
|
|
|
|
|
Cash resources and
securities
|
$
|
4,302
|
1.39%
|
$
|
4,443
|
1.33%
|
$
|
5,324
|
1.80%
|
Traditional
single-family residential mortgages
|
|
145,867
|
4.95%
|
|
148,945
|
5.02%
|
|
144,496
|
4.98%
|
Accelerator
single-family residential mortgages
|
|
8,651
|
2.63%
|
|
6,879
|
2.47%
|
|
7,518
|
2.90%
|
Residential
commercial mortgages 2
|
|
5,036
|
3.97%
|
|
4,121
|
3.85%
|
|
3,959
|
4.79%
|
Non-residential
commercial mortgages
|
|
22,205
|
5.95%
|
|
21,067
|
6.09%
|
|
16,566
|
6.16%
|
Credit card loans and
lines of credit
|
|
8,388
|
9.05%
|
|
7,823
|
9.14%
|
|
7,552
|
9.21%
|
Other consumer retail
loans
|
|
6,905
|
9.81%
|
|
6,216
|
9.96%
|
|
7,181
|
10.07%
|
Total non-securitized
loans
|
|
197,052
|
5.00%
|
|
195,051
|
5.07%
|
|
187,272
|
5.11%
|
Taxable equivalent
adjustment
|
|
941
|
-
|
|
937
|
-
|
|
1,024
|
-
|
Total on
non-securitized interest earning assets
|
|
202,295
|
4.76%
|
|
200,431
|
4.79%
|
|
193,620
|
4.89%
|
Securitized
single-family residential mortgages
|
|
13,549
|
2.74%
|
|
14,524
|
2.85%
|
|
22,875
|
3.12%
|
Securitized
multi-unit residential mortgages
|
|
8,580
|
4.28%
|
|
8,879
|
4.29%
|
|
10,969
|
4.09%
|
Assets pledged as
collateral for securitization
|
|
724
|
0.63%
|
|
912
|
0.62%
|
|
1,715
|
1.22%
|
Total securitized
residential mortgages
|
|
22,853
|
2.82%
|
|
24,315
|
2.81%
|
|
35,559
|
3.11%
|
Total
interest-bearing assets
|
$
|
225,148
|
4.35%
|
$
|
224,746
|
4.36%
|
$
|
229,179
|
4.42%
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
|
Deposits and
other
|
$
|
77,762
|
2.03%
|
$
|
80,771
|
2.14%
|
$
|
81,326
|
2.28%
|
Senior
debt
|
|
1,824
|
4.78%
|
|
1,512
|
3.96%
|
|
1,660
|
4.55%
|
Securitization
liabilities
|
|
17,963
|
2.20%
|
|
19,828
|
2.26%
|
|
28,753
|
2.48%
|
Total
interest-bearing liabilities
|
$
|
97,549
|
1.89%
|
$
|
102,111
|
1.98%
|
$
|
111,739
|
2.15%
|
Net Interest
Income (TEB)
|
$
|
127,599
|
|
$
|
122,635
|
|
$
|
117,440
|
|
Tax Equivalent
Adjustment
|
|
(941)
|
|
|
(937)
|
|
|
(1,024)
|
|
Net Interest
Income per Financial Statements
|
$
|
126,658
|
|
$
|
121,698
|
|
$
|
116,416
|
|
|
|
|
|
|
|
2015
|
|
|
2014
|
(000s, except
%)
|
|
|
|
|
Income/
|
Average
|
|
Income/
|
Average
|
|
|
|
|
|
Expense
|
Rate
1
|
|
Expense
|
Rate
1
|
Interest-bearing
assets
|
|
|
|
|
|
|
|
|
|
Cash resources and
securities
|
|
|
|
$
|
18,571
|
1.44%
|
$
|
25,338
|
1.81%
|
Traditional
single-family residential mortgages
|
|
|
|
|
588,854
|
4.99%
|
|
552,112
|
5.10%
|
Accelerator
single-family residential mortgages
|
|
|
|
|
28,777
|
2.58%
|
|
26,746
|
2.80%
|
Residential
commercial mortgages 2
|
|
|
|
|
17,053
|
4.16%
|
|
14,355
|
4.68%
|
Non-residential
commercial mortgages
|
|
|
|
|
80,032
|
6.06%
|
|
64,852
|
6.27%
|
Credit card loans and
lines of credit
|
|
|
|
|
31,427
|
9.06%
|
|
28,529
|
9.18%
|
Other consumer retail
loans
|
|
|
|
|
23,419
|
9.88%
|
|
31,204
|
9.21%
|
Total non-securitized
loans
|
|
|
|
|
769,562
|
5.05%
|
|
717,798
|
5.21%
|
Taxable equivalent
adjustment
|
|
|
|
|
3,830
|
-
|
|
4,117
|
-
|
Total on
non-securitized interest earning assets
|
|
|
|
|
791,963
|
4.79%
|
|
747,253
|
4.93%
|
Securitized
single-family residential mortgages
|
|
|
|
|
62,891
|
2.79%
|
|
105,393
|
3.21%
|
Securitized
multi-unit residential mortgages
|
|
|
|
|
36,625
|
4.23%
|
|
54,634
|
4.23%
|
Assets pledged as
collateral for securitization
|
|
|
|
|
4,325
|
0.84%
|
|
6,464
|
1.18%
|
Total securitized
residential mortgages
|
|
|
|
|
103,841
|
2.86%
|
|
166,491
|
3.25%
|
Total
interest-bearing assets
|
|
|
|
$
|
895,804
|
4.35%
|
$
|
913,744
|
4.43%
|
Interest-bearing
liabilities
|
|
|
|
|
|
|
|
|
|
Deposits and
other
|
|
|
|
$
|
318,597
|
2.14%
|
$
|
311,494
|
2.28%
|
Senior
debt
|
|
|
|
|
6,396
|
4.18%
|
|
6,392
|
4.35%
|
Securitization
liabilities
|
|
|
|
|
85,891
|
2.32%
|
|
132,212
|
2.55%
|
Total
interest-bearing liabilities
|
|
|
|
$
|
410,884
|
1.99%
|
$
|
450,098
|
2.18%
|
Net Interest
Income (TEB)
|
|
|
|
$
|
484,920
|
|
$
|
463,646
|
|
Tax Equivalent
Adjustment
|
|
|
|
|
(3,830)
|
|
|
(4,117)
|
|
Net Interest
Income per Financial Statements
|
|
|
|
$
|
481,090
|
|
$
|
459,529
|
|
1 The
average is calculated with reference to opening and closing monthly
asset and liability balances.
|
2 Residential commercial mortgages
include non-securitized multi-unit residential mortgages and
commercial mortgages secured by residential property
types.
|
Mortgage
Advances
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
|
For the year
ended
|
|
|
|
December
31
|
|
September
30
|
|
December
31
|
|
December
31
|
|
December
31
|
(000s)
|
|
2015
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Single-family
residential mortgages
|
|
|
|
|
|
|
|
|
|
|
|
Traditional
|
$
|
1,304,268
|
$
|
1,514,429
|
$
|
1,484,475
|
$
|
5,074,723
|
$
|
5,864,562
|
|
Accelerator
|
|
515,891
|
|
416,273
|
|
353,002
|
|
1,391,740
|
|
1,785,032
|
Residential
commercial mortgages
|
|
|
|
|
|
|
|
|
|
|
|
Multi-unit uninsured
residential mortgages
|
|
23,503
|
|
31,031
|
|
38,519
|
|
105,098
|
|
93,476
|
|
Multi-unit insured
residential mortgages
|
|
101,683
|
|
298,438
|
|
261,016
|
|
688,743
|
|
624,879
|
|
Other1
|
|
8,535
|
|
18,460
|
|
14,296
|
|
43,957
|
|
45,615
|
Non-residential
commercial mortgages
|
|
|
|
|
|
|
|
|
|
|
|
Stores and
apartments
|
|
26,462
|
|
32,728
|
|
24,144
|
|
109,115
|
|
118,272
|
|
Commercial
|
|
173,825
|
|
186,598
|
|
114,999
|
|
646,033
|
|
319,459
|
Total mortgage
advances
|
$
|
2,154,167
|
$
|
2,497,957
|
$
|
2,290,451
|
$
|
8,059,409
|
$
|
8,851,295
|
1 Other
residential commercial mortgages include mortgages such as
builders' inventory.
|
|
|
|
|
|
|
|
|
|
|
Provision for
Credit Losses and Net Write-offs as a Percentage of Gross
Loans on an Annualized Basis
|
|
|
|
|
|
For the three months
ended
|
(000s, except
%)
|
December 31,
2015
|
September 30,
2015
|
December 31,
2014
|
|
|
|
% of
Gross
|
|
|
% of Gross
|
|
|
% of Gross
|
|
Amount
|
Loans
1
|
Amount
|
Loans1
|
Amount
|
Loans1
|
Provision2
|
|
|
|
|
|
|
|
|
|
Single-family
residential mortgages
|
$
|
986
|
0.03%
|
$
|
1,805
|
0.06%
|
$
|
2,203
|
0.07%
|
Residential
commercial mortgages
|
|
-
|
-
|
|
-
|
-
|
|
24
|
0.04%
|
Non-residential
commercial mortgages
|
|
(40)
|
(0.01)%
|
|
237
|
0.06%
|
|
81
|
0.03%
|
Credit card loans and
lines of credit
|
|
343
|
0.37%
|
|
163
|
0.19%
|
|
128
|
0.15%
|
Other consumer retail
loans
|
|
101
|
0.14%
|
|
44
|
0.07%
|
|
90
|
0.19%
|
Securitized
single-family residential mortgages
|
|
-
|
-
|
|
-
|
-
|
|
-
|
-
|
Securitized
multi-unit residential mortgages
|
|
-
|
-
|
|
-
|
-
|
|
-
|
-
|
Total individual
provision
|
|
1,390
|
0.03%
|
|
2,249
|
0.05%
|
|
2,586
|
0.06%
|
Total collective
provision
|
|
25
|
0.00%
|
|
600
|
0.01%
|
|
600
|
0.01%
|
Total
provision
|
$
|
1,415
|
0.03%
|
$
|
2,849
|
0.06%
|
$
|
3,186
|
0.07%
|
Net
Write-Offs2
|
|
|
|
|
|
|
|
|
|
Single-family
residential mortgages
|
$
|
1,415
|
0.04%
|
$
|
1,128
|
0.03%
|
$
|
3,054
|
0.10%
|
Residential
commercial mortgages
|
|
-
|
-
|
|
-
|
-
|
|
24
|
0.04%
|
Non-residential
commercial mortgages
|
|
127
|
0.03%
|
|
303
|
0.08%
|
|
56
|
0.02%
|
Credit card loans and
lines of credit
|
|
502
|
0.54%
|
|
163
|
0.19%
|
|
114
|
0.14%
|
Other consumer retail
loans
|
|
94
|
0.13%
|
|
29
|
0.04%
|
|
48
|
0.10%
|
Securitized
single-family residential mortgages
|
|
-
|
-
|
|
-
|
-
|
|
-
|
-
|
Securitized
multi-unit residential mortgages
|
|
-
|
-
|
|
-
|
-
|
|
-
|
-
|
Net
write-offs
|
$
|
2,138
|
0.05%
|
$
|
1,623
|
0.04%
|
$
|
3,296
|
0.07%
|
|
|
|
|
|
|
|
|
|
|
(000s, except
%)
|
|
2015
|
2014
|
|
|
|
|
|
|
% of
Gross
|
|
|
% of Gross
|
|
|
|
|
Amount
|
Loans1
|
Amount
|
Loans1
|
Provision2
|
|
|
|
|
|
|
|
|
|
Single-family
residential mortgages
|
|
|
|
$
|
5,415
|
0.04%
|
$
|
9,507
|
0.08%
|
Residential
commercial mortgages
|
|
|
|
|
4
|
0.00%
|
|
(1)
|
(0.00)%
|
Non-residential
commercial mortgages
|
|
|
|
|
720
|
0.05%
|
|
270
|
0.02%
|
Credit card loans and
lines of credit
|
|
|
|
|
798
|
0.22%
|
|
571
|
0.17%
|
Other consumer retail
loans
|
|
|
|
|
171
|
0.06%
|
|
187
|
0.10%
|
Securitized
single-family residential mortgages
|
|
|
|
|
-
|
-
|
|
-
|
-
|
Securitized
multi-unit residential mortgages
|
|
|
|
|
-
|
-
|
|
-
|
-
|
Total individual
provision
|
|
|
|
|
7,108
|
0.04%
|
|
10,534
|
0.06%
|
Total collective
provision
|
|
|
|
|
1,825
|
0.01%
|
|
2,600
|
0.01%
|
Total
provision
|
|
|
|
$
|
8,933
|
0.05%
|
$
|
13,134
|
0.07%
|
Net
Write-Offs2
|
|
|
|
|
|
|
|
|
|
Single-family
residential mortgages
|
|
|
|
$
|
5,292
|
0.04%
|
$
|
9,099
|
0.07%
|
Residential
commercial mortgages
|
|
|
|
|
4
|
0.00%
|
|
24
|
0.01%
|
Non-residential
commercial mortgages
|
|
|
|
|
435
|
0.03%
|
|
202
|
0.02%
|
Credit card loans and
lines of credit
|
|
|
|
|
969
|
0.26%
|
|
692
|
0.21%
|
Other consumer retail
loans
|
|
|
|
|
168
|
0.06%
|
|
272
|
0.15%
|
Securitized
single-family residential mortgages
|
|
|
|
|
-
|
-
|
|
-
|
-
|
Securitized
multi-unit residential mortgages
|
|
|
|
|
-
|
-
|
|
-
|
-
|
Net
write-offs
|
|
|
|
$
|
6,868
|
0.04%
|
$
|
10,289
|
0.06%
|
1 Gross
loans used in the calculation of total Company ratio includes
securitized on-balance sheet loans.
|
2 There
were no specific provisions, allowances or net write-offs on
securitized mortgages.
|
Loans by
Geographic Region and Type (net of individual allowances for credit
losses)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s, except
%)
|
|
|
|
As at December 31,
2015
|
|
British
|
|
|
|
|
|
|
|
Columbia
|
Alberta
|
Ontario
|
Quebec
|
|
Other
|
|
Total
|
Securitized
single-family residential mortgages
|
$
|
125,239
|
$
|
114,807
|
$
|
1,559,536
|
$
|
81,262
|
$
|
67,266
|
$
|
1,948,110
|
Securitized
multi-unit residential mortgages
|
|
94,676
|
|
46,848
|
|
372,141
|
|
51,309
|
|
161,391
|
|
726,365
|
Total securitized
mortgages
|
|
219,915
|
|
161,655
|
|
1,931,677
|
|
132,571
|
|
228,657
|
|
2,674,475
|
Single-family
residential mortgages
|
|
706,555
|
|
525,984
|
|
11,060,894
|
|
419,075
|
|
266,910
|
|
12,979,418
|
Residential
commercial mortgages1
|
|
21,128
|
|
14,215
|
|
216,407
|
|
27,265
|
|
42,427
|
|
321,442
|
Non-residential
commercial mortgages
|
|
25,157
|
|
59,861
|
|
1,358,295
|
|
14,505
|
|
32,830
|
|
1,490,648
|
Credit card loans and
lines of credit
|
|
9,598
|
|
22,709
|
|
330,188
|
|
1,489
|
|
6,841
|
|
370,825
|
Other consumer retail
loans
|
|
783
|
|
11,090
|
|
284,231
|
|
-
|
|
753
|
|
296,857
|
Total non-securitized
mortgages and loans2
|
|
763,221
|
|
633,859
|
|
13,250,015
|
|
462,334
|
|
349,761
|
|
15,459,190
|
|
$
|
983,136
|
$
|
795,514
|
$
|
15,181,692
|
$
|
594,905
|
$
|
578,418
|
$
|
18,133,665
|
As a % of
portfolio
|
|
5.4%
|
|
4.4%
|
|
83.7%
|
|
3.3%
|
|
3.2%
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s, except
%)
|
|
|
|
|
|
|
|
|
|
As at September 30,
2015
|
|
|
British
|
|
|
|
|
|
|
|
|
|
|
|
|
Columbia
|
|
Alberta
|
|
Ontario
|
|
Quebec
|
|
Other
|
|
Total
|
Securitized
single-family residential mortgages
|
$
|
136,396
|
$
|
108,656
|
$
|
1,676,375
|
$
|
90,839
|
$
|
60,867
|
$
|
2,073,133
|
Securitized
multi-unit residential mortgages
|
|
103,608
|
|
61,846
|
|
396,139
|
|
71,204
|
|
194,656
|
|
827,453
|
Total securitized
mortgages
|
|
240,004
|
|
170,502
|
|
2,072,514
|
|
162,043
|
|
255,523
|
|
2,900,586
|
Single-family
residential mortgages
|
|
694,241
|
|
485,077
|
|
11,052,127
|
|
415,887
|
|
254,769
|
|
12,902,101
|
Residential
commercial mortgages1
|
|
24,530
|
|
24,242
|
|
198,956
|
|
23,989
|
|
24,174
|
|
295,891
|
Non-residential
commercial mortgages
|
|
26,060
|
|
62,397
|
|
1,327,687
|
|
12,860
|
|
36,194
|
|
1,465,198
|
Credit card loans and
lines of credit
|
|
5,280
|
|
15,020
|
|
316,965
|
|
1,532
|
|
3,988
|
|
342,785
|
Other consumer retail
loans
|
|
754
|
|
6,716
|
|
259,570
|
|
-
|
|
703
|
|
267,743
|
Total non-securitized
mortgages and loans2
|
|
750,865
|
|
593,452
|
|
13,155,305
|
|
454,268
|
|
319,828
|
|
15,273,718
|
|
$
|
990,869
|
$
|
763,954
|
$
|
15,227,819
|
$
|
616,311
|
$
|
575,351
|
$
|
18,174,304
|
As a % of
portfolio
|
|
5.4%
|
|
4.2%
|
|
83.8%
|
|
3.4%
|
|
3.2%
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s, except
%)
|
|
|
|
|
|
|
|
|
|
As at December 31,
2014
|
|
|
British
|
|
|
|
|
|
|
|
|
|
|
|
|
Columbia
|
|
Alberta
|
|
Ontario
|
|
Quebec
|
|
Other
|
|
Total
|
Securitized
single-family residential mortgages
|
$
|
218,927
|
$
|
182,797
|
$
|
2,376,966
|
$
|
127,999
|
$
|
83,430
|
$
|
2,990,119
|
Securitized
multi-unit residential mortgages
|
|
133,838
|
|
72,615
|
|
480,693
|
|
79,128
|
|
189,261
|
|
955,535
|
Total securitized
mortgages
|
|
352,765
|
|
255,412
|
|
2,857,659
|
|
207,127
|
|
272,691
|
|
3,945,654
|
Single-family
residential mortgages
|
|
661,661
|
|
445,390
|
|
10,737,812
|
|
392,998
|
|
212,667
|
|
12,450,528
|
Residential
commercial mortgages1
|
|
7,972
|
|
36,869
|
|
147,697
|
|
22,645
|
|
28,135
|
|
243,318
|
Non-residential
commercial mortgages
|
|
9,956
|
|
45,263
|
|
1,001,141
|
|
10,422
|
|
40,096
|
|
1,106,878
|
Credit card loans and
lines of credit
|
|
5,829
|
|
16,505
|
|
302,699
|
|
1,477
|
|
3,817
|
|
330,327
|
Other consumer retail
loans
|
|
826
|
|
2,204
|
|
182,576
|
|
-
|
|
505
|
|
186,111
|
Total non-securitized
mortgages and loans2
|
|
686,244
|
|
546,231
|
|
12,371,925
|
|
427,542
|
|
285,220
|
|
14,317,162
|
|
$
|
1,039,009
|
$
|
801,643
|
$
|
15,229,584
|
$
|
634,669
|
$
|
557,911
|
$
|
18,262,816
|
As a % of
portfolio
|
|
5.7%
|
|
4.4%
|
|
83.4%
|
|
3.5%
|
|
3.0%
|
|
100.0%
|
1
Residential commercial mortgages include non-securitized multi-unit
residential mortgages and commercial mortgages secured by
residential property types.
|
2 Loans
exclude mortgages held for sale.
|
Impaired Loans and
Individual Allowances for Credit Losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
|
|
|
As at December 31,
2015
|
|
|
Single-Family
|
|
Residential
|
|
Non-Residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Gross amount of
impaired loans
|
$
|
49,285
|
$
|
-
|
$
|
2,558
|
$
|
1,518
|
$
|
161
|
$
|
53,522
|
Individual allowances
on principal
|
|
(1,652)
|
|
-
|
|
(340)
|
|
(329)
|
|
(161)
|
|
(2,482)
|
Net amount of
impaired loans
|
$
|
47,633
|
$
|
-
|
$
|
2,218
|
$
|
1,189
|
$
|
-
|
$
|
51,040
|
Net impaired loans as
a % of gross loans
|
|
0.37%
|
|
-
|
|
0.15%
|
|
0.32%
|
|
-
|
|
0.28%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
|
|
|
As at September 30,
2015
|
|
|
Single-Family
|
|
Residential
|
|
Non-Residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Gross amount of
impaired loans
|
$
|
50,873
|
$
|
-
|
$
|
4,594
|
$
|
1,450
|
$
|
155
|
$
|
57,072
|
Individual allowances
on principal
|
|
(1,952)
|
|
-
|
|
(405)
|
|
(68)
|
|
(155)
|
|
(2,580)
|
Net amount of
impaired loans
|
$
|
48,921
|
$
|
-
|
$
|
4,189
|
$
|
1,382
|
$
|
-
|
$
|
54,492
|
Net impaired loans as
a % of gross loans
|
|
0.38%
|
|
-
|
|
0.29%
|
|
0.40%
|
|
-
|
|
0.30%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
|
|
|
As at December 31,
2014
|
|
|
Single-Family
|
|
Residential
|
|
Non-Residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Gross amount of
impaired loans
|
$
|
52,551
|
$
|
54
|
$
|
2,516
|
$
|
1,938
|
$
|
160
|
$
|
57,219
|
Individual allowances
on principal
|
|
(1,808)
|
|
-
|
|
(55)
|
|
(80)
|
|
(160)
|
|
(2,103)
|
Net amount of
impaired loans
|
$
|
50,743
|
$
|
54
|
$
|
2,461
|
$
|
1,858
|
$
|
-
|
$
|
55,116
|
Net impaired loans as
a % of gross loans
|
|
0.41%
|
|
0.02%
|
|
0.22%
|
|
0.56%
|
|
-
|
|
0.30%
|
|
|
Allowance for
Credit Losses
|
|
|
|
|
(000s)
|
For the three months
ended December 31, 2015
|
|
|
Single-family
|
|
Residential
|
|
Non-residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Individual
allowances
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance on loan
principal
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
$
|
1,952
|
$
|
-
|
$
|
405
|
$
|
68
|
$
|
155
|
$
|
2,580
|
Allowance assumed on
purchase of CFF Bank
|
|
-
|
|
-
|
|
-
|
|
420
|
|
-
|
|
420
|
Provision for credit
losses
|
|
1,115
|
|
-
|
|
62
|
|
343
|
|
100
|
|
1,620
|
Write-offs
|
|
(1,531)
|
|
-
|
|
(167)
|
|
(519)
|
|
(123)
|
|
(2,340)
|
Recoveries
|
|
116
|
|
-
|
|
40
|
|
17
|
|
29
|
|
202
|
|
|
1,652
|
|
-
|
|
340
|
|
329
|
|
161
|
|
2,482
|
Allowance on accrued
interest receivable
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
|
968
|
|
-
|
|
159
|
|
-
|
|
4
|
|
1,131
|
Provision for credit
losses
|
|
(129)
|
|
-
|
|
(102)
|
|
-
|
|
1
|
|
(230)
|
|
|
839
|
|
-
|
|
57
|
|
-
|
|
5
|
|
901
|
Total individual
allowance
|
|
2,491
|
|
-
|
|
397
|
|
329
|
|
166
|
|
3,383
|
Collective
allowance
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
|
22,232
|
|
327
|
|
9,500
|
|
3,541
|
|
300
|
|
35,900
|
Allowance assumed on
purchase of CFF Bank
|
|
-
|
|
-
|
|
-
|
|
324
|
|
-
|
|
324
|
Provision for credit
losses
|
|
-
|
|
-
|
|
-
|
|
25
|
|
-
|
|
25
|
|
|
22,232
|
|
327
|
|
9,500
|
|
3,890
|
|
300
|
|
36,249
|
Total
allowance
|
$
|
24,723
|
$
|
327
|
$
|
9,897
|
$
|
4,219
|
$
|
466
|
$
|
39,632
|
Total
provision
|
$
|
986
|
$
|
-
|
$
|
(40)
|
$
|
368
|
$
|
101
|
$
|
1,415
|
|
|
(000s)
|
For the three months
ended September 30, 2015
|
|
|
Single-family
|
|
Residential
|
|
Non-residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Individual
allowances
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance on loan
principal
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
$
|
1,463
|
$
|
-
|
$
|
480
|
$
|
68
|
$
|
142
|
$
|
2,153
|
Provision for credit
losses
|
|
1,617
|
|
-
|
|
228
|
|
163
|
|
42
|
|
2,050
|
Write-offs
|
|
(1,417)
|
|
-
|
|
(309)
|
|
(166)
|
|
(78)
|
|
(1,970)
|
Recoveries
|
|
289
|
|
-
|
|
6
|
|
3
|
|
49
|
|
347
|
|
|
1,952
|
|
-
|
|
405
|
|
68
|
|
155
|
|
2,580
|
Allowance on accrued
interest receivable
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
|
780
|
|
-
|
|
150
|
|
-
|
|
2
|
|
932
|
Provision for credit
losses
|
|
188
|
|
-
|
|
9
|
|
-
|
|
2
|
|
199
|
|
|
968
|
|
-
|
|
159
|
|
-
|
|
4
|
|
1,131
|
Total individual
allowance
|
|
2,920
|
|
-
|
|
564
|
|
68
|
|
159
|
|
3,711
|
Collective
allowance
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
|
21,632
|
|
327
|
|
9,500
|
|
3,541
|
|
300
|
|
35,300
|
Provision for credit
losses
|
|
600
|
|
-
|
|
-
|
|
-
|
|
-
|
|
600
|
|
|
22,232
|
|
327
|
|
9,500
|
|
3,541
|
|
300
|
|
35,900
|
Total
allowance
|
$
|
25,152
|
$
|
327
|
$
|
10,064
|
$
|
3,609
|
$
|
459
|
$
|
39,611
|
Total
provision
|
$
|
2,405
|
$
|
-
|
$
|
237
|
$
|
163
|
$
|
44
|
$
|
2,849
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
|
For the three months
ended December 31, 2014
|
|
|
Single-family
|
|
Residential
|
|
Non-residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Individual
allowances
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance on loan
principal
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
$
|
2,399
|
$
|
-
|
$
|
55
|
$
|
66
|
$
|
118
|
$
|
2,638
|
Provision for credit
losses
|
|
2,463
|
|
24
|
|
56
|
|
128
|
|
90
|
|
2,761
|
Write-offs
|
|
(3,125)
|
|
(24)
|
|
(56)
|
|
(134)
|
|
(123)
|
|
(3,462)
|
Recoveries
|
|
71
|
|
-
|
|
-
|
|
20
|
|
75
|
|
166
|
|
|
1,808
|
|
-
|
|
55
|
|
80
|
|
160
|
|
2,103
|
Allowance on accrued
interest
receivable
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
|
760
|
|
-
|
|
32
|
|
-
|
|
3
|
|
795
|
Provision for credit
losses
|
|
(200)
|
|
-
|
|
25
|
|
-
|
|
-
|
|
(175)
|
|
|
560
|
|
-
|
|
57
|
|
-
|
|
3
|
|
620
|
Total individual
allowance
|
|
2,368
|
|
-
|
|
112
|
|
80
|
|
163
|
|
2,723
|
Collective
allowance
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the period
|
|
20,032
|
|
327
|
|
9,300
|
|
3,541
|
|
300
|
|
33,500
|
Provision for credit
losses
|
|
600
|
|
-
|
|
-
|
|
-
|
|
-
|
|
600
|
|
|
20,632
|
|
327
|
|
9,300
|
|
3,541
|
|
300
|
|
34,100
|
Total
allowance
|
$
|
23,000
|
$
|
327
|
$
|
9,412
|
$
|
3,621
|
$
|
463
|
$
|
36,823
|
Total
provision
|
$
|
2,863
|
$
|
24
|
$
|
81
|
$
|
128
|
$
|
90
|
$
|
3,186
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
|
For the year ended
December 31, 2015
|
|
|
Single-family
|
|
Residential
|
|
Non-residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Individual
allowances
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance on loan
principal
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the year
|
$
|
1,808
|
$
|
-
|
$
|
55
|
$
|
80
|
$
|
160
|
$
|
2,103
|
Allowance assumed on
purchase of CFF Bank
|
|
-
|
|
-
|
|
-
|
|
420
|
|
-
|
|
420
|
Provision for credit
losses
|
|
5,136
|
|
4
|
|
720
|
|
798
|
|
169
|
|
6,827
|
Write-offs
|
|
(6,357)
|
|
(9)
|
|
(486)
|
|
(1,005)
|
|
(442)
|
|
(8,299)
|
Recoveries
|
|
1,065
|
|
5
|
|
51
|
|
36
|
|
274
|
|
1,431
|
|
|
1,652
|
|
-
|
|
340
|
|
329
|
|
161
|
|
2,482
|
Allowance on accrued
interest receivable
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the year
|
|
560
|
|
-
|
|
57
|
|
-
|
|
3
|
|
620
|
Provision for credit
losses
|
|
279
|
|
-
|
|
-
|
|
-
|
|
2
|
|
281
|
|
|
839
|
|
-
|
|
57
|
|
-
|
|
5
|
|
901
|
Total individual
allowance
|
|
2,491
|
|
-
|
|
397
|
|
329
|
|
166
|
|
3,383
|
Collective
allowance
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the year
|
|
20,632
|
|
327
|
|
9,300
|
|
3,541
|
|
300
|
|
34,100
|
Allowance assumed on
purchase of CFF Bank
|
|
-
|
|
-
|
|
-
|
|
324
|
|
-
|
|
324
|
Provision for credit
losses
|
|
1,600
|
|
-
|
|
200
|
|
25
|
|
-
|
|
1,825
|
|
|
22,232
|
|
327
|
|
9,500
|
|
3,890
|
|
300
|
|
36,249
|
Total
allowance
|
$
|
24,723
|
$
|
327
|
$
|
9,897
|
$
|
4,219
|
$
|
466
|
$
|
39,632
|
Total
provision
|
$
|
7,015
|
$
|
4
|
$
|
920
|
$
|
823
|
$
|
171
|
$
|
8,933
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
For the year ended
December 31, 2014
|
|
|
Single-family
|
|
Residential
|
|
Non-residential
|
|
Credit
Card
|
|
Other
|
|
|
|
|
Residential
|
|
Commercial
|
|
Commercial
|
|
Loans and
|
|
Consumer
|
|
|
|
|
Mortgages
|
|
Mortgages
|
|
Mortgages
|
|
Lines of
Credit
|
|
Retail
Loans
|
|
Total
|
Individual
allowances
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance on loan
principal
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the year
|
$
|
1,201
|
$
|
-
|
$
|
-
|
$
|
201
|
$
|
236
|
$
|
1,638
|
Provision for credit
losses
|
|
9,706
|
|
24
|
|
257
|
|
571
|
|
196
|
|
10,754
|
Write-offs
|
|
(9,645)
|
|
(24)
|
|
(294)
|
|
(752)
|
|
(488)
|
|
(11,203)
|
Recoveries
|
|
546
|
|
-
|
|
92
|
|
60
|
|
216
|
|
914
|
|
|
1,808
|
|
-
|
|
55
|
|
80
|
|
160
|
|
2,103
|
Allowance on accrued
interest receivable
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the year
|
|
759
|
|
25
|
|
44
|
|
-
|
|
12
|
|
840
|
Provision for credit
losses
|
|
(199)
|
|
(25)
|
|
13
|
|
-
|
|
(9)
|
|
(220)
|
|
|
560
|
|
-
|
|
57
|
|
-
|
|
3
|
|
620
|
Total individual
allowance
|
|
2,368
|
|
-
|
|
112
|
|
80
|
|
163
|
|
2,723
|
Collective
allowance
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at the
beginning of the year
|
|
18,032
|
|
327
|
|
9,300
|
|
3,541
|
|
300
|
|
31,500
|
Provision for credit
losses
|
|
2,600
|
|
-
|
|
-
|
|
-
|
|
-
|
|
2,600
|
|
|
20,632
|
|
327
|
|
9,300
|
|
3,541
|
|
300
|
|
34,100
|
Total
allowance
|
$
|
23,000
|
$
|
327
|
$
|
9,412
|
$
|
3,621
|
$
|
463
|
$
|
36,823
|
Total
provision
|
$
|
12,107
|
$
|
(1)
|
$
|
270
|
$
|
571
|
$
|
187
|
$
|
13,134
|
There were no
specific provisions, allowances, or net write-offs on securitized
residential mortgages.
|
Securitization
Activity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
|
|
|
|
December
31
|
|
|
September
30
|
|
|
|
|
|
|
2015
|
|
|
|
|
|
2015
|
|
Single-Family
|
Multi-Unit
|
|
|
Single-Family
|
Multi-Unit
|
|
|
|
Residential
MBS
|
Residential
MBS
|
Total
MBS
|
Residential
MBS
|
Residential
MBS
|
Total MBS
|
Carrying value of
underlying mortgages derecognized
|
$
|
371,473
|
$
|
161,757
|
$
|
533,230
|
$
|
210,881
|
$
|
154,986
|
$
|
365,867
|
Net gains on sale of
mortgages or residual interest 1
|
|
3,362
|
|
1,366
|
|
4,728
|
|
3,183
|
|
1,270
|
|
4,453
|
Retained interests
recorded
|
|
-
|
|
5,933
|
|
5,933
|
|
-
|
|
8,910
|
|
8,910
|
Servicing liability
recorded
|
|
-
|
|
1,278
|
|
1,278
|
|
-
|
|
1,686
|
|
1,686
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
|
|
For the three months
ended
|
|
|
|
|
|
|
|
December
31
|
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
|
|
|
Single-Family
|
Multi-Unit
|
|
|
|
|
|
|
|
Residential
MBS
|
Residential
MBS
|
Total MBS
|
Carrying value of
underlying mortgages derecognized
|
|
|
|
|
|
|
$
|
371,782
|
$
|
241,023
|
$
|
612,805
|
Net gains on sale of
mortgages or residual interest 1
|
|
|
|
|
|
|
|
2,549
|
|
1,813
|
|
4,362
|
Retained interests
recorded
|
|
|
|
|
|
|
|
-
|
|
9,289
|
|
9,289
|
Servicing liability
recorded
|
|
|
|
|
|
|
|
-
|
|
2,257
|
|
2,257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
2015
|
|
2014
|
|
Single-Family
|
Multi-Unit
|
|
|
Single
Family
|
Multi-Unit
|
|
|
|
Residential
MBS
|
Residential
MBS
|
Total
MBS
|
Residential
MBS
|
Residential
MBS
|
Total MBS
|
Carrying value of
underlying mortgages derecognized
|
$
|
1,184,253
|
$
|
713,635
|
$
|
1,897,888
|
$
|
1,745,454
|
$
|
783,972
|
$
|
2,529,426
|
Net gains on sale of
mortgages or residual interest 1
|
|
15,499
|
|
5,913
|
|
21,412
|
|
18,685
|
|
5,027
|
|
23,712
|
Retained interests
recorded
|
|
-
|
|
33,228
|
|
33,228
|
|
-
|
|
32,090
|
|
32,090
|
Servicing liability
recorded
|
|
-
|
|
6,229
|
|
6,229
|
|
-
|
|
6,781
|
|
6,781
|
1 Gains on sale of mortgages or
residual interest are net of hedging impact.
|
Securitization
Income
|
|
|
|
|
(000s)
|
|
|
|
For the three months
ended
|
|
|
|
December 31,
2015
|
|
September 30,
2015
|
|
December 31,
2014
|
Net gain on sale of
mortgages or residual interest1
|
|
$
|
4,728
|
$
|
4,453
|
$
|
4,362
|
Net change in
unrealized gain or loss on hedging activities
|
|
|
(232)
|
|
(39)
|
|
(591)
|
Servicing
income
|
|
|
1,264
|
|
1,374
|
|
1,185
|
Total securitization
income
|
|
$
|
5,760
|
$
|
5,788
|
$
|
4,956
|
|
|
|
|
|
|
|
|
|
|
(000s)
|
|
|
|
|
|
2015
|
|
|
2014
|
Net gain on sale of
mortgages and residual interest1
|
|
|
|
|
$
|
21,412
|
|
$
|
23,712
|
Net change in
unrealized gain or loss on hedging activities
|
|
|
|
|
|
(313)
|
|
|
(177)
|
Servicing
income
|
|
|
|
|
|
5,109
|
|
|
3,310
|
Total securitization
income
|
|
|
|
|
$
|
26,208
|
|
$
|
26,845
|
1 Gains on
sale of mortgages or residual interest are net of hedging
impact.
|
Management's Responsibility for Financial Information
The Company's Audit Committee reviewed this document along with
the Company's 2015 Annual and Fourth Quarter Consolidated Financial
Report. The Company's Board of Directors approved both
documents prior to their release. A full description of
management's responsibility for financial information is included
in the Company's 2015 Annual and Fourth Quarter Consolidated
Financial Report.
Caution Regarding Forward-looking Statements
From time to time Home Capital makes written and verbal
forward-looking statements. These are included in the Annual
Report, periodic reports to shareholders, regulatory filings, press
releases, Company presentations and other Company communications.
Forward-looking statements are made in connection with business
objectives and targets, Company strategies, operations, anticipated
financial results and the outlook for the Company, its industry,
and the Canadian economy. These statements regarding expected
future performance are "financial outlooks" within the meaning of
National Instrument 51-102. Please see the risk factors,
which are set forth in detail in the Risk Management section of the
Company's 2015 Annual and Fourth Quarter Consolidated Financial
Report, as well as its other publicly filed information, which are
available on the System for Electronic Document Analysis and
Retrieval (SEDAR) at www.sedar.com, for the material factors that
could cause the Company's actual results to differ materially from
these statements. These risk factors are material risk
factors a reader should consider, and include credit risk, funding
and liquidity risk, structural interest rate risk, operational
risk, investment risk, strategic and business risk, reputational
risk, compliance risk, and capital adequacy risk along with
additional risk factors that may affect future results.
Forward-looking statements can be found in the Report to the
Shareholders and the Outlook sections in the Annual
Report. Forward-looking statements are typically
identified by words such as "will," "believe," "expect,"
"anticipate," "estimate," "plan," "forecast," "may," and "could" or
other similar expressions.
By their very nature, these statements require the Company to
make assumptions and are subject to inherent risks and
uncertainties, general and specific, which may cause actual results
to differ materially from the expectations expressed in the
forward-looking statements. These risks and uncertainties
include, but are not limited to, global capital market activity,
changes in government monetary and economic policies, changes in
interest rates, inflation levels and general economic conditions,
legislative and regulatory developments, competition and
technological change. The preceding list is not exhaustive of
possible factors.
These and other factors should be considered carefully and
readers are cautioned not to place undue reliance on these
forward-looking statements. The Company does not undertake to
update any forward-looking statements, whether written or verbal,
that may be made from time to time by it or on its behalf, except
as required by securities laws.
Assumptions about the performance of the Canadian economy in
2016 and its effect on Home Capital's business are material factors
the Company considers when setting its objectives, targets and
outlook. In determining expectations for economic growth,
both broadly and in the financial services sector, the Company
primarily considers historical and forecasted economic data
provided by the Canadian government and its agencies. In
setting and reviewing its targets, objectives and outlook for 2016,
management's expectations assume:
- The Canadian economy is expected to be relatively stable in
2016; however, it will continue to be impacted by adverse effects
related to the drop and fluctuations in oil prices and other
commodities. The Company has limited exposure in energy
producing regions.
- Generally the Company expects stable employment conditions in
its established regions; however, unemployment rates in energy
producing regions are expected to continue to increase in
2016. Also, the Company expects inflation will generally be
within the Bank of Canada's target
of 1% to 3%, leading to stable credit losses and consistent demand
for the Company's lending products in its established regions.
Credit losses and delinquencies in the energy producing regions may
increase, but given the Company's limited exposure, this is not
expected to be significant.
- The Canadian economy will continue to be influenced by the
economic conditions in the United
States and global markets and further adjustments in
commodity prices; as such, the Company is prepared for the
variability to plan that may result.
- The Company is assuming that overnight interest rates will
remain at the current very low rate for 2016. This is expected to
continue to support relatively low mortgage interest rates for the
foreseeable future.
- In the Company's established regions, the Company expects that
the housing market will remain stable with reduced, but balanced
supply supported by continued low interest rates, and relatively
stable employment, depending on location and immigration.
There will be moderately easing housing starts and resale activity
with relatively stable prices throughout most of Canada, with continued regional disparities.
This supports continued stable credit losses and stable demand for
the Company's lending products in its established regions.
- The Company expects that consumer debt levels, while elevated,
will remain serviceable by Canadian households.
- The Company will have access to the mortgage and deposit
markets through broker networks.
Non-GAAP Measures
The Company has adopted IFRS as its accounting framework. IFRS
are the generally accepted accounting principles (GAAP) for
Canadian publicly accountable enterprises for years beginning on or
after January 1, 2011. The Company
uses a number of financial measures to assess its
performance. Some of these measures are not calculated in
accordance with GAAP, are not defined by GAAP, and do not have
standardized meanings that would ensure consistency and
comparability between companies using these measures.
Definitions of non-GAAP measures used in this report can be found
under Non-GAAP Measures in the Management's Discussion and Analysis
included in the Company's 2015 Annual and Fourth Quarter
Consolidated Financial Report.
Regulatory Filings
The Company's continuous disclosure materials, including interim
filings, annual Management's Discussion and Analysis and audited
consolidated financial statements, Annual Information Form, Notice
of Annual Meeting of Shareholders, and Proxy Circular are available
on the Company's website at www.homecapital.com and on the Canadian
Securities Administrators' website at www.sedar.com.
Home Capital Group Inc. is a public company, traded on the
Toronto Stock Exchange (HCG), operating through its principal
subsidiary, Home Trust Company. Home Trust is a federally regulated
trust company offering deposits, residential and non-residential
mortgage lending, securitization of insured residential first
mortgage products, consumer lending and credit card services.
Home Trust also conducts business through its wholly owned
subsidiary, CFF Bank. In addition, Home Trust offers deposits
via brokers and financial planners, and through its direct to
consumer brand, Oaken Financial. Licensed to conduct business
across Canada, Home Trust has
offices in Ontario, Alberta, British
Columbia, Nova Scotia,
Quebec and Manitoba.
SOURCE Home Capital Group Inc.