VANCOUVER, British Columbia, May 28, 2021 (GLOBE NEWSWIRE) – Central 1 Credit Union (“ Central 1 ” or “ the organization ”) reported an after-tax profit of $ 24.7 million for the first quarter (Q1) ended March 31, 2021, compared to a loss of $ 37.3 million for the same period in 2020.
In the first quarter of 2021, Central 1 reported strong results thanks to the organization’s diverse business model, operational resilience to managing the ongoing pandemic and improving the economic environment. Central 1 maintained the confidence of the credit union system and supported members and customers with essential products and services. The organization continued to make strategic investments to improve its digital and payments capabilities to meet the changing demands of Canadians.
“Central 1’s performance this quarter reflects our adaptability, strong balance sheet and the strength of our organization,” said Sheila Vokey, Interim President and CEO. “We have managed expenses effectively and strive to be well positioned to deliver the right products and services to our members and customers as the pace of innovation and change accelerates.”
The organization remains focused on supporting the credit union system and the system’s success. Central 1 continues to be a financially strong and profitable organization, driven by strong growth in our investment portfolio and a prudent investment strategy, combined with a steady increase in fee-based income and increased operational efficiency.
Consolidated results for Q1 2021 compared to Q1 2020:
As of January 1, 2021, Central 1 ceased operation of the mandatory liquidity pool when it was separated.
- Profit of $ 24.7 million, compared to a loss of $ 37.3 million (excluding discontinued operations) in 2020.
- Assets of $ 14.4 billion, up 44.0% from $ 10.0 billion (excluding discontinued operations) in 2020.
The previous year’s results reflect the impact of the pandemic due to the significant widening of credit spreads and rate cuts by the Bank of Canada. However, credit spreads have narrowed since the second quarter of 2020 and returned to pre-pandemic levels at the end of 2020. Non-financial income and expenses have remained relatively stable. Investments in strategic initiatives continued in the first quarter of 2021, but decreased by $ 9.5 million compared to the first quarter of 2020.
Statement of Financial Position
Excluding assets from discontinued operations, total assets as at March 31, 2021 increased $ 0.4 billion from December 31, 2020 and $ 4.4 billion from a year ago, supported by strong growth in deposits. In response to the potential economic impact of COVID-19, many credit unions continued to hold high levels of liquidity. Deposits placed with Central 1 have increased by $ 0.5 billion since December 31, 2020 and $ 5.4 billion since March 31, 2020.
The Treasury posted a profit of $ 26.9 million, compared to a loss of $ 26.2 million in the same quarter a year ago. In January, Central 1 successfully issued a 5-year $ 250 million senior deposit note prior to the maturity of a $ 350 million senior note. Although Central 1’s liquidity levels remain high, Central 1 took advantage of attractive prices and market conditions and blocked 5-year term funding. Central 1 has focused on supporting our members with our asset management services, which have been developed and delivered in partnership with Credential QTrade Securities Inc. This service was created as a direct response to assist our members in the MLP transition.
Digital banking and payment platforms and experiences
Digital Banking and Payment Platforms and Experiences (DBPX), formerly Digital and Payment Services, suffered a loss of $ 2.0 million compared to a loss of $ 11.4 million a year ago. This is explained by an increase in Interac® e-Transfer volumes, reflecting the continued increase in the use of online payments during the COVID-19 pandemic. Investments in strategic initiatives continued in 2021, including the Payments Modernization initiative, with the committed amount being $ 10.1 million less year over year.
About Central 1
Central 1 is a preferred partner for financial, digital banking and payments products and services, fueling the success of businesses across Canada. With assets of $ 14.4 billion as of March 31, 2021, we leverage our scale, strength and expertise to advance the progress of more than 250 credit unions and other financial institutions, thereby improving the well- be financial to more than 5 million customers coast to coast. . For more information visit www.central1.com.
Caution Regarding Forward-Looking Statements
This press release contains forward-looking statements based on assumptions, uncertainties and management’s best estimates regarding future events. These include, but are not limited to, statements relating to our financial performance objectives, our strategic vision and goals, economic review, market and regulation, and the outlook for the Canadian economy. and the provincial economies in which our member credit unions operate and the impacts of COVID. -19 pandemic, as well as statements containing the words “may”, “will”, “intends” and “anticipates” and other similar words and expressions. Forward-looking statements are based on the opinions and estimates of management as of the date the statements are made. Actual results may differ materially from those currently expected. Securityholders are cautioned that these forward-looking statements involve risks and uncertainties. Certain important assumptions made by Central 1 when making forward-looking statements include, but are not limited to, competitive conditions, economic conditions, regulatory considerations, and the impacts of the COVID-19 pandemic. Significant risk factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include economic risks, regulatory risks, risks and uncertainty related to the impact of the pandemic. COVID-19 and other risks detailed from time to time in Central 1 Periodic Reports filed with securities regulatory authorities. In view of these risks, the reader is cautioned not to place undue reliance on forward-looking statements. Central 1 assumes no obligation to update or revise forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
Vice-President, Stakeholder Relations and Communications
T 604 714 6733 or 1 800 661 6813 ext. 6733
E [email protected]
Director of Investments Central 1
T 905 282 8588 or 1800 661 6813 ext. 8588
E [email protected]