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Winnipeg Free Press - PRINT EDITION

Western Bank profit up 62%

National Leasing credited for growth

By: Martin Cash

Posted: 09/2/2010 1:00 AM | Comments: 0 (including replies)

BORIS.MINKEVICH@FREEPRESS.MB.CA Enlarge Image

Larry Pollock describes National Leasing as a ‘real jewel.’

The brand new headquarters of National Leasing Group was the location for the release of Canadian Western Bank's latest record breaking results on Wednesday.

Last December, the plucky Edmonton-based bank bought Winnipeg's National Leasing for $130 million and made it clear that it was interested in using the Winnipeg company as a platform to increase its market share in the lucrative small and mid-sized equipment leasing business.

Canadian Western Bank, Q3 results (as of June 30, 2010):

Total revenue -- $108.3 million, up 30 per cent

Net income -- $46.6 million, up 62 per cent

Assets -- $12.1 billion, up seven per cent

Loans -- $10.1 billion, up 11 per cent

Deposits -- $10.3 billion, up nine per cent

"We told their people today that the acquisition of National Leasing was not the end of the deal, it was just the end of the beginning," Canadian Western Bank CEO Larry Pollock said. "Our strategic plan calls for the material numbers to grow."

The bank released its 89th consecutive profitable quarter late Wednesday, coming in with profits up 62 per cent over last year and total revenue up 30 per cent.

Pollock, the longest-serving Canadian bank CEO, credits National Leasing with making a healthy contribution to the bank's latest results. "This company is a real jewel," he said.

Since the December acquisition, the bank now has 15 per cent of its employees and seven per cent of its assets in Manitoba.

"There is a new 55,000 square foot headquarters here and we are going to grow this business until we need to build another building here," he said, only half joking.

Meanwhile, National Leasing CEO Nick Logan said while there are not necessarily any deals imminent, they are in discussion with up to 20 different players.

The fact that the big banks are not interested in the small equipment leasing market that National Leasing has gone on to excel at fits perfectly with Canadian Western Bank's sweet spot.

The bank's style is to stick to the business of being an intermediary in the small and medium-sized commercial loan business and largely staying out of the asset management and investment banking business.

Pollock said despite all the hand-wringing about the economy, there is business to be had.

Asked where all the bank's growth is coming from, he said, "We're going after business the other banks don't want and we're getting more of a share of it than we used to get."

Never a darling of Bay Street, the bank's stock has always traded at multiples less than those of the larger Canadian banks.

Even though it produced record breaking results in 2009, Canadian Western's stock bottomed out like the rest of the world's financial services companies last year.

martin.cash@freepress.mb.ca

Republished from the Winnipeg Free Press print edition September 2, 2010 B9

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