EDMONTON, Alberta, Oct. 03, 2024 (GLOBE NEWSWIRE) -- Following the historic merger between Servus and connectFirst Credit Unions, the newly created Connect First and Servus Credit Union Ltd. (CFSCU) is marking its first reporting period with sound financial health. The merger was finalized on May 1, 2024.
Through the merger, CFSCU became one of the largest and strongest credit unions in Canada. Despite operating in the high interest and inflationary environment that all Albertans are facing, the credit union achieved a healthy balance sheet and steady growth in the quarter, covering the period of May 1 through July 31, 2024.
"I am delighted to share the results of our first joint financial report, which indicate that we are starting to achieve the anticipated financial benefits of the merger," says Ian Burns, President and CEO of both the new CFSCU and the former Servus Credit Union Ltd. "Our goal as a merged organization is to now thoughtfully begin to deliver on additional merger benefits while maintaining fiscal responsibility, and to bring the credit union way of banking to even more Albertans."
CFSCU's results for the nine months ended July 31, 2024 show:
- Total assets at $29.0 billion
- Loans at $24.8 billion
- Deposits at $24.1 billion
- Retained earnings at $1.2 billion
- Provision for credit losses at $61.8 million, which includes a one-time $12.9 million merger-related adjustment
- Operating expenses at $397.7 million
- Income before income taxes at $94.1 million
The financial results include merger-related accounting adjustments that have a temporary impact for CFSCU. The adjustments are primarily due to the high-interest rate environment and the requirement to value assets and liabilities at fair market value. The increase in operating income this quarter was primarily due to $23.9 million in merger-related accounting adjustments. The normalized income before income taxes excluding these adjustments is $70.2 million.
While housing prices in Alberta are trending up due to tight supply, the relatively lower cost of housing in the province continues to draw in immigrants from more expensive parts of Canada. The province has also shown strong economic growth across different sectors, aided by the surge in population.
Despite these positive economic trends, job creation in Alberta has started to taper and inflation and interest rate headwinds remain persistent. CFSCU members and all Albertans are facing the pinch of rising prices which has contributed to elevated credit losses. Continued rate relief is, however, expected from the Bank of Canada for the remainder of 2024 and going into 2025.
"Despite financially volatile times, our merged credit union is as committed as ever to standing by our co-operative principles, serving our members, and building stronger communities," says Burns. "We expect to stay the course on our growth strategy by focusing on providing our members with the best financial advice, while limiting our loan losses through prudent decision making and by continuing to be cost conscious."
Servus and connectFirst are trade names of Connect First and Servus Credit Union Ltd. All rights reserved.
About Servus Credit Union Ltd.
Servus Credit Union has served Albertans for over 80 years with a full line of secure financial services. The financial institution has more than 100 branches in 61 communities throughout the province as well as options for online, mobile and telephone banking. Servus's noble purpose is to help members reimagine their financial fitness so that they feel good about their money. For more information about Servus, call 1.877.378.8728 or visit servus.ca.
About connectFirst Union Ltd.
connectFirst Credit Union, one of the largest and most successful credit unions in Canada, is a full-service financial institution with over $7 billion in assets under administration. connectFirst employs 750 Albertans who provide a wide range of financial products and advice in more than 40 communities across central and southern Alberta. It serves over 125,000 members through a community-focused approach to banking.
Media contact:
media@servus.ca
825.402.0740
