More business, lower earnings as ATB Financial records solid first-quarter results



    EDMONTON, Aug. 18 /CNW/ - ATB Financial (ATB) posted double-digit
percentage growth over last year's first quarter in both loans and deposits,
but credit loss provisions and lower interest rates pushed profits down.
    Net income in this year's first quarter was $33.1 million, down 41.6 per
cent from last year. Loans, including securitized mortgages, were up 15.7 per
cent over last year's first quarter to $23.2 billion, while retail deposits
increased 10.9 per cent to $20.7 billion.
    "Put simply, we're doing more business - and good business. However,
interest rates are lower and our margins are tighter," said Dave Mowat, ATB
Financial's President and CEO.
    "We are active in the marketplace meeting the financial needs of more
Albertans than ever, and we're committed to knowing and serving Albertans
better than anyone else."
    Net income was also impacted by a $10.4-million increase in ATB's
allowance for credit loss expense. This increase strengthens ATB's allowance
for potential losses based on continuing economic uncertainty.
    Meanwhile, Alberta businesses and investors increasingly sought out ATB
as a financial partner. Business loans increased 23.9 per cent to $9.2
billion, while ATB Investor Services' customer base grew and the assets it
manages increased to $4.2 billion.
    "While some might choose to scale back in times of uncertainty, ATB is
strategically re-investing in Alberta," Mowat said. "We're ramping up our
capacity to serve strong Alberta businesses, and Alberta investors who want
world-class customer service and advice."
    Though markets improved in recent months, ATB's estimate of the fair
value of its investments in asset-backed commerical paper (ABCP) remains
unchanged. ATB does not expect to reflect gains in the fair value of ABCP on
its income statement until there is strong evidence that the assets' value has
actually increased.

    
    Operational Highlights
    ----------------------
    

    Personal and Business Financial Services (PBFS) - ATB's largest line of
business includes branches and agencies throughout Alberta. Assets, primarily
consisting of loans, grew $1.5 billion, or 9.7 per cent, over the last year.
Operating revenue increased by $2.5 million, or 1.6 per cent. PBFS unveiled
North America-leading technological and customer service innovations at two
Calgary branches - Uptown/17th Avenue and Stampede Station.

    Corporate Financial Services (CFS) - This line of business provides
services to Alberta's mid- and senior-market companies in three sub-lines -
Energy, Commercial, and Food & Forestry. CFS's assets grew $1.6 billion, or
38.7 per cent over the last year. Operating revenue increased over last year
by $24.3 million, or 87.4 per cent.

    ATB Investor Services (IS) - This line of business is responsible for
growing and protecting wealth for more than 47,000 customers. At the end of
the first quarter, client assets under management and administration reached
$4.2 billion, up $105.7 million from last year's first quarter, or 2.6 per
cent.

    ATB in the Community - ATB's associates and customers celebrated ATB's
10th annual Teddy for a Toonie campaign, which raises money every May for the
Stollery and Alberta Children's Hospital foundations. ATB also supported
Alberta cross-country skier Sara Renner with a major Olympic-year partnership.

    About ATB Financial - ATB Financial is the largest Alberta-based
financial institution, with assets of $26.5 billion. It provides Personal and
Business Financial Services, Investor Services, and Corporate Financial
Services to 670,000 Albertans in 243 communities. It provides service through
164 branches and 132 agencies, telephone and Internet banking, a Customer
Contact Centre, and Automated Banking Machines. ATB Financial was established
in 1938 and has been a provincial Crown corporation since 1997. It has been
named one of Canada's 50 Best Employers by Report on Business Magazine, one of
the 75 Best Workplaces in Canada by the Great Place to Work Institute, and one
of Alberta's Top 40 Employers by Mediacorp Canada Inc.

    For complete first-quarter financial results, please visit www.atb.com




For further information:

For further information: Shawn Ohler, Director of External and Media
Relations, ATB Financial, (780) 913-8905 (cell), (780) 408-6529 (office),
e-mail: sohler@atb.com


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