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SECTOR OUTLOOKOntario Credit Unions and Caisses Populaires

Second Quarter Ended June 30, 2018 Sector Credit Unions Caisses Populaires

Financial Highlights 2Q-2018* 1Q-2018 2Q-2017 2Q-2018* 1Q-2018 2Q-2017 2Q-2018* 1Q-2018 2Q-2017

Income Statement (% average assets) Net Interest Income 1.97 1.97 1.93 1.93 1.96 1.90 2.21 2.02 2.19Loan Costs 0.06 0.08 0.06 0.06 0.07 0.06 0.07 0.09 0.07Other Income 0.50 0.53 0.53 0.47 0.50 0.51 0.70 0.72 0.71Non-Interest Expense 1.90 1.93 1.97 1.91 1.94 1.98 1.83 1.84 1.92Taxes 0.10 0.10 0.08 0.08 0.08 0.07 0.23 0.23 0.18Net Income 0.42 0.40 0.35 0.37 0.37 0.30 0.79 0.58 0.72Balance Sheet ($ billions; as at quarter end) Assets 60.3 58.3 54.4 52.6 50.8 47.3 7.8 7.5 7.1Loans 52.8 50.9 47.0 46.1 44.4 40.9 6.8 6.5 6.1Deposits 47.6 46.1 43.5 42.0 40.6 38.1 5.5 5.5 5.4Members' Equity & Capital 4.2 4.2 3.8 3.5 3.5 3.1 0.7 0.7 0.6Capital Ratios (%) Leverage 7.02 7.15 6.95 6.71 6.85 6.60 9.12 9.20 9.22Risk Weighted 13.80 13.96 13.38 13.15 13.27 12.72 18.21 18.83 17.65Key Measures and Ratios (% except as noted) Return on Regulatory Capital 5.99 5.60 5.07 5.47 5.47 4.49 8.56 6.25 7.88Liquidity Ratio 10.4 10.3 11.1 10.8 10.6 11.6 7.7 8.2 7.6Efficiency Ratio (before dividends/rebates) 76.6 77.1 79.8 78.9 78.7 82.1 63.4 67.5 66.8Efficiency Ratio 78.7 79.4 81.9 81.3 81.0 84.4 64.3 69.5 68.0Commercial Loan Delinquency>30 days 0.78 0.97 0.73 0.72 0.93 0.67 1.18 1.29 1.13Total Loan Delinquency>30 days 0.53 0.64 0.52 0.50 0.61 0.49 0.73 0.81 0.77Asset Growth (from last quarter) 3.43 1.92 2.70 3.46 1.94 2.83 3.24 1.81 1.89Loan Growth (from last quarter) 3.80 2.17 3.20 3.72 2.25 3.37 4.35 1.68 2.09Deposit Growth (from last quarter) 3.12 1.37 2.19 3.53 1.36 2.35 0.07 1.45 1.06Credit Unions (number) 79 81 97 67 69 73 12 12 24Membership (thousands) 1,649 1,596 1,612 1,462 1,441 1,422 188 154 190Average Assets ($ millions, per credit union) 764 720 561 784 736 648 648 628 296

* Trends are current quarter to last quarter Better Neutral Worse

1Sector Outlook Second Quarter Ended June 30, 2018

Sector Key Financial Trends

2009 2010 2011 2012 2013 2014 2015 2016 2017 20184%5%6%7%8%9%

10%11%12%13%14%

Table #1 - Selected Growth Trends

Assets Loans Deposits

2009 2010 2011 2012 2013 2014 2015 2016 2017 20181.00%

1.25%

1.50%

1.75%

2.00%

2.25%

2.50%

2.75%

3.00%

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%

0.80%

0.90%Table #2 - Selected Performance Trends

Financial Margin (L) Operating Expenses (L) Loan Costs (R)Other Income (R) ROA (R)

2009 2010 2011 2012 2013 2014 2015 2016 2017 201870%

75%

80%

85%

90%

95%

100%

0.20%

0.30%

0.40%

0.50%

0.60%

0.70%Table #3 - Efficiency Ratio and Return on Assets

Efficiency Ratio (L) ROA (R)

2009 2010 2011 2012 2013 2014 2015 2016 2017 20182%

4%

6%

8%

10%

12%

14%

16%

Table #4 - Loan Growth

Personal Mortgages CommercialTotal 5-Year Average

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2009 2010 2011 2012 2013 2014 2015 2016 2017 20180.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%Table #5 - Loan Delinquencies - Greater than 30 Days

Personal Mortgages Commercial Total

2009 2010 2011 2012 2013 2014 2015 2016 2017 20183.0%

3.5%

4.0%

4.5%

5.0%

5.5%

6.0%

6.5%

7.0%

7.5%

8.0%Table #6 - Loan Yields

Personal Mortgages Commerical Total

2Q 20134Q 2013

2Q 20144Q 2014

2Q 20154Q 2015

2Q 20164Q 2016

2Q 20174Q 2017

1Q 20182Q 2018

0%2%4%6%8%

10%12%14%16%18%

Table #7 - Deposit Growth - Yearly Growth

Demand Deposits Term DepositsRegistered Deposits Total Deposits5 Year Average Total Deposit Growth Rate

$-

$1,000,000,000

$2,000,000,000

$3,000,000,000

$4,000,000,000

$5,000,000,000

$6,000,000,000

$7,000,000,000

$8,000,000,000

8%

9%

10%

11%

12%

13%

14%

15%

16%

Total Borrowings in $millions (L) Securitizations in $millions (L)Liquidity Ratio (R)

Table #8 - Liquidity, Total Borrowings and Securitization

DISCLAIMER: The information presented in this report has been prepared using the latest financial filings submitted to DICO and as such accuracy and completeness cannot be guaranteed. Income Statement results are the aggregate of year-to-date annualized information.

ELECTRONIC PUBLICATION: The Sector Outlook is available in PDF format (readable using Adobe Acrobat Reader) and can be downloaded from the Publications section on DICO’s website at www.dico.com.


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New This QuarterThe Sector Outlook is refreshed this quarter. The format is designed to focus analysis in areas DICO considers particularly relevant and share observations about the sector. It provides summaries and detailed comparisons to year earlier and previous quarter financial periods for the sector in aggregate, credit unions and caisses populaires.

DICO Observations Q2-2018 Profitability is increasing; this is likely to continue as higher rates are reflected in new and repriced loans (although slightly offset by

higher interest on deposits), and non-interest expenses are controlled. Asset growth (10.9% year over year) continues to be fueled by residential mortgages (15.1%), perhaps impacted by tightened

lending rules at banks; it appears increasing interest rates and slowing sales volumes and/or reduced prices in some markets have not had a negative impact on sector growth.

Loan growth continues to outpace deposit growth leading to increased reliance on securitization transactions (up 26.9% year over year), bank borrowings and new capital, any of which may become constrained and are more expensive.

Liquidity decreased by 67 bps year over year to 10.43% as growth in liquid assets was outpaced by growth in deposits, borrowings and securitization transactions.

Capital and capital ratios are under pressure as growth in loans outpaces growth in retained earnings. Investment shares comprise a growing portion of total sector capital.

Though gross loan delinquency is relatively unchanged, recent and potential increases in interest rates combined with near-record levels of household debt could impact loan delinquencies and costs in the future.

Economic OverviewThe Bank of Canada (“Bank”) raised its overnight rate to 1.50% on July 11, 2018, the second 25 bps increase this year and the fourth in 12 months.

The Bank’s current expectation is the global economy will grow by about 3.75% in 2018 and 3.50% in 2019. It sees the U.S. economy and U.S. dollar strong, and reflecting this strength and concerns about trade actions, a lower Canadian dollar.

In its July statement, the Bank says Canada’s economy is operating at close to capacity. It considers growth has shifted: household spending has been dampened by higher interest rates and tighter mortgage lending guidelines, but there is data suggesting that housing markets are stabilizing; exports are buoyed by strong global demand and higher commodity prices; business investment is growing given strong demand and capacity constraints but is tempered by trade tensions in some sectors.


The Bank still expects average growth in Canada of about 2% over 2018-2020. Projections incorporate an estimate of the impact of trade uncertainty on Canadian investment and exports, but the Bank suggests this may be understated given mounting trade tensions. Projections also incorporate the estimated impact of tariffs on steel and aluminum already imposed by the U.S. and countermeasures announced by Canada, the results of which will be difficult for some industries but are expected to be modest for the Canadian economy overall. The consensus view of Canadian economists is there could be two or three 25 bps increases over the next 18 months.

The Bank did not make specific comment about household debt-to-income levels which remain high but have moderated somewhat to 168% in 1Q-2018 from 170.4% the quarter earlier (according to Statistics Canada). The decrease has been attributed to more stringent mortgage lending rules, rising interest rates and accelerating incomes.

Housing MarketsIn June 2018, Canada Housing and Mortgage Corporation released its “Housing Market Insight-Ontario” report (ID no. 68865, available on its website). The report concludes nominal home prices should grow in line with the general rate of inflation over the 2018-2019 period, the entire Ontario market should not be painted with one brush and more affordable segments of the market will outperform, as will more affordable urban centers in eastern and southern Ontario, as GTA prices resume growth. The caveats, considered of lower probability, are an Ontario/GTA economy growing below forecast, steeper interest rate increases or declining consumer or business sentiments.

The Toronto Real Estate Board reports that July 2018 year-over-year sales and average prices increased 18.6% and 4.8% respectively in the GTA.

ConsolidationThe sector has continued to consolidate over the last twelve months with number of institutions decreasing by 18 to 79 institutions with average asset size increasing to $764 million; credit unions declined by six to 67 with average assets of $784 million; caisse populaires decreased by 12 to 12 with average asset size of $648 million. These amalgamations should result in larger, more stable entities capable of achieving economies of scale.

Profitability2Q-2018 vs 2Q-2017

As shown in Tables 2 and 3 on page 2, return on average assets for the sector increased to 42 bps (up 7 bps or 20%) from the same quarter a year earlier mainly reflecting improved net interest income (up 4 bps to 1.97%), decreased other income (down 3 bps to 50 bps) and reduced non-interest expenses (down 7 bps to 1.90%). Within the sector, return on average assets for credit unions increased to 37 bps (up 7 bps or 23%) mainly due to increased net interest income (up 3 bps to 1.93%), a decrease in other income (down 4 bps to 0.47%) and reduced non-interest expenses (down 7 bps to 1.91%). Caisses profitability improved to 79 bps (up 7 bps


or 10%) mainly reflecting improvements in net interest income (up 2 bps to 2.21%) and non-interest expenses (down 9 bps to 1.83%), offset by higher income taxes (up 5 bps to 0.23%).

Out of 79 credit unions, seven credit unions have a negative return on assets. DICO closely monitors credit unions that are unprofitable, identifies core challenges and works with the credit unions to develop strategies to resolve the situation with the intention of returning to profitability.

1Q 2018 Ontario Sector vs Canadian Sector*

*Most recent report by Canadian Credit Union Association; including Ontario sector

Ontario sector profitability of 40 bps was below that of the Canadian sector (52 bps). Although net interest income of 1.97% (vs 2.12%) and other income of 0.53% (vs 0.56%) were lower, non-interest expenses of 1.93% (vs 1.97%) were better and taxes and loan costs were similar.

Capital 2Q-2018 vs 2Q-2017

Sector capital increased to $4.2 billion (up $465 million or 12.4%) from the year earlier quarter comprised of:

Retained earnings of $2.5 billion (up $206 million or 8.9%); Investment and patronage shares of $1.6 billion (up $266 million or 19.5%); and Membership shares of $64 million (down $1 million or 2.2%).

Within the sector, credit union capital increased to $3.5 billion (up $410 million or 13.1%) and consisted of:

Retained earnings of $1.9 billion (up $145 million or 8.1%); Investment and patronage shares of $1.5 billion (up $266 million or 20.8%); and Membership shares unchanged at $62 million.

Caisses capital increased to $698 million (up $55 million or 8.6%) comprised of:

Retained earnings of $596 million (up $62 million or 11.5%); Investment and patronage shares unchanged at $87 million; and Membership shares of $2 million (down $1 million or 38%).

As a percent of risk weighted assets, sector capital was 13.80% (up 42 bps) from the year earlier quarter mostly due to increases in investment and patronage shares. Credit union capital was 13.15% (up 43 bps) and caisses capital was 18.21% (up 56 bps). Leverage for the sector was 7.02% (up 7 bps) reflecting credit union leverage of 6.71% (up 11 bps) and caisses leverage of 9.12% (down 10 bps).


Although profitability is increasing, growth in retained earnings has not been keeping pace with the growth in assets. In order to maintain minimum capital requirements and provide for future growth, credit unions have been increasing dependency on the issuance of investment shares. As a result, investment shares are becoming a growing portion of their capital composition (38.6% in 2Q18 versus 36.3% in 2Q17).

2Q-2018 vs 1Q-2018

Sector capital increased by $77 million (1.9% from $4.1 billion) from last quarter primarily from an increase in retained earnings of $73 million (3.0% from $2.4 billion) with membership and investment shares unchanged.

Sector capital as a percent of risk weighted assets decreased 16 bps (from 13.96%) in the previous quarter. Credit union capital decreased 12 bps (from 13.27%) and caisses’ capital decreased 62 bps (from 18.83%). Leverage for the sector decreased 13 bps (from 7.15%) reflecting decreases at credit unions of 14 bps (from 6.85%) and at caisses of 8 bps (from 9.20%).

Liquidity (including Securitization)

2Q-2018 vs 2Q-2017

As shown in Tables 7 and 8, sector deposits increased by $4.0 billion (up 9.3% to $47.6 billion), securitizations increased by $1.4 billion (up 26.9% to $6.7 billion) and borrowings decreased by $0.2 billion (down 28.8% to $0.6 billion), a net increase of $5.2 billion (up 10.5% to $54.9 billion) from the year earlier. However, liquid assets increased only $0.2 billion (up 3.9% to $5.7 billion) resulting in a decrease in liquidity to 10.43% (down 67 bps from 11.10% in 2Q17).

In 2Q18, there were 31 credit unions (21 credit unions, 10 caisse populaires) with combined total assets of $50.9 billion (84% of sector assets) participating in the securitization programs. In March 2018, DICO published the Securitization Guidance Note outlining prudent risk management measures which comes into effect on September 1, 2018. DICO is monitoring the use of securitization programs by credit unions notwithstanding the concentration of this funding source at a few credit unions.

Deposits at credit unions increased by $3.9 billion (up 10.3% to $42 billion), securitizations increased by $1.2 billion (up 24.2% to $6.4 billion) and with borrowings unchanged, the net increase was $5.2 billion (up 12% to $48.5 billion). However, liquid assets increased only $0.2 billion (up 4.1% to $5.2 billion) resulting in a decrease in liquidity to 10.8% (down 81 bps from 11.61%).

Deposits at caisses increased by $116 million (up 2.1% to $5.5 billion), securitizations increased by $189 million (up 106.7% to $365 million) and borrowings decreased $249 million (down 33.0% to $507 million), a net increase of $55 million (up 0.9% to $6.4 billion). However, liquid assets increased only $7 million (up 1.4% to $492 million) resulting in a decrease in liquidity to 7.68% (down 4 bps from 7.72%)


2Q-2018 vs 1Q-2018

Sector deposits increased by $1.4 billion (up 3.1% from $46.1 billion), securitizations increased by $0.5 billion (up 7.9% from $6.2 billion) and borrowings decreased by $0.2 billion (down 29% from $0.8 billion), a net increase of $1.7 billion (up 3.2% from $53.2 billion) from last quarter. Liquid assets increased $0.3 billion (up 4.7% from $5.5 billion) resulting in an increase in liquidity of 15 bps (from 10.28%).

Efficiency Ratio (before dividends/interest rebates)

2Q-2018 vs 2Q-2017

As shown in Table 3, sector efficiency ratio improved to 76.6% (down 320 bps from 79.8%) from the year earlier quarter. Credit unions improved to 78.9% (down 320 bps from 82.1%) and caisses to 63.4% (down 340 bps from 66.8%).

2Q-2018 vs 1Q-2018

Compared to last quarter, sector efficiency improved by 50 bps (from 77.1%) reflecting nominal deterioration at credit unions of 2 bps (from 78.7%) more than offset by improvement at caisses of 410 bps (from 67.5%).

1Q-2018 Ontario Sector vs. Canadian Sector

Although operating expense as a percent of average assets for the Ontario sector (1.93%) was 4 bps better than the Canadian sector (1.97%), the efficiency ratios (77.1%) was 580 bps worse than the Canadian sector (71.3%). The gap is wider than in 1Q-2017 when the spread was 420 bps (Ontario at 79.7% and Canadian Sector at 75.4%).

Credit Quality (delinquency greater than 30 days)

2Q-2018 vs 2Q-2017

As shown in Table 5, gross loan delinquency was essentially unchanged at 53 bps (up 1 bp from 52 bps) from the year earlier quarter. Credit unions reflected an increase to 50 bps (up 1 bp from 49 bps) and caisses decreased to 73 bps (down 4 bps from 77 bps).

Residential mortgage loan delinquency was essentially unchanged at 38 bps (up 1 bp from 37 bps) in the year earlier quarter. Credit unions reflected an increase to 38 bps (up 1 bp from 37 bps) and caisses decreased to 39 bps (down 2 bps from 41 bps).

Commercial loan delinquency increased to 78 bps (up 5 bps from 73 bps) the year earlier. Within the sector, commercial loan delinquency increased at credit unions to 72 bps (up 5 bps from 67 bps) and at caisses to 118 bps (up 5 bps from 113 bps).

2Q-2018 vs 1Q-2018


Compared to last quarter, gross delinquency for the sector improved by 11 bps (from 64 bps) reflecting decreases at credit unions of 11 bps (from 61 bps) and at caisses of 8 bps (from 81 bps).

Residential mortgage loan delinquency for the sector improved by 7 bps (from 45 bps) reflecting decreases at credit unions of 7 bps (from 45 bps) and at caisses of 3 bps (from 42 bps).

Commercial loan delinquency for the sector improved by 19 bps (from 97 bps) from the previous quarter reflecting decreases at credit unions of 21 bps (from 93 bps) and at caisses of 11 bps (from 129 bps).

Growth2Q-2018 vs 2Q-2017

Compared to the previous year, total sector assets increased to $60.3 billion (up $6 billion or 10.9%). This was largely due to growth in residential mortgage loans to $32.6 billion (up $4.3 billion or 15.1%) and commercial loans to $15.7 billion (up $1.7 billion or 12.2%). As shown in Table 4, the annual growth of residential mortgage loans was the highest growth rate in the last ten years. Within the sector, credit unions increased total assets to $52.6 billion (up $5.3 billion or 11.1%) reflecting growth in residential mortgage loans to $28.6 billion (up $3.7 billion or 15.2%) and commercial loans to $13.7 billion (up $1.5 billion or 12.5%). Caisses total assets increased to $7.8 billion (up $673 million or 9.5%) mainly attributed to growth in residential mortgage loans to $3.9 billion (up $498 million or 14.5%) and commercial loans to $1.9 billion (up $176 million or 10%).

2Q-2018 vs 1Q-2018

Total assets for the sector increased by $2.0 billion (3.4% from $58.3 billion) from last quarter reflecting growth of $1.4 billion (4.3% from $31.2 billion) in residential mortgage loans and commercial loans of $419 million (2.7% from $15.3 billion). Within the sector, total assets in credit unions increased by $1.8 billion (3.5% from $50.8 billion) reflecting increases of $1.2 billion (4.4% from $27.4 billion) in residential mortgages loans and commercial loans of $287 million (2.1% from $13.5 billion). Caisses total assets increased by $244 million (3.2% from $7.5 billion) reflecting growth of $134 million (3.5% from $3.8 billion) in residential mortgages loans and increased commercial loans of $131 million (7.3% from $1.8 billion)

1Q-2018 Ontario Sector vs. Canadian Sector

Ontario sector total assets growth rate of 10.1% was 290 bps higher than the Canadian sector (7.2%) attributable to growth in residential mortgages loans of 14.9% (vs 8.8%), commercial loans of 11.0% (vs 9.8%) and agricultural loans of 10.5% (vs 9.9%).


Sector Income Statements% of Average Assets (except as noted)

Sector Credit Unions Caisses Populaires Canadian Sector

2Q-2018 1Q-2018 2Q-2017 2Q-2018 1Q-2018 2Q-2017 2Q-2018 1Q-2018 2Q-2017 1Q-2018

Interest and Investment Income Loan Interest 3.17% 3.15% 3.05% 3.21% 3.18% 3.09% 2.93% 2.92% 2.83% 3.16% Investment Income 0.23% 0.22% 0.22% 0.19% 0.20% 0.18% 0.51% 0.35% 0.47% 0.24%Total Interest and Investment Income 3.41% 3.37% 3.27% 3.40% 3.38% 3.27% 3.44% 3.27% 3.30% 3.40% Interest and Dividend Expense Interest Expense on Deposits 1.12% 1.08% 1.05% 1.14% 1.10% 1.07% 0.94% 0.91% 0.85% 1.10% Rebates/Dividends on Share Capital 0.05% 0.05% 0.04% 0.05% 0.05% 0.03% 0.04% 0.08% 0.05% 0.00% Dividends on Investment/Other Capital 0.02% 0.01% 0.03% 0.03% 0.01% 0.04% 0.00% 0.00% 0.00% 0.09% Other Interest Expense 0.25% 0.24% 0.22% 0.25% 0.24% 0.22% 0.25% 0.25% 0.21% 0.08% Total 0.32% 0.32% 0.29% 0.33% 0.32% 0.30% 0.29% 0.33% 0.26% 0.17%Total Interest and Dividend Expense 1.44% 1.40% 1.34% 1.47% 1.42% 1.37% 1.22% 1.25% 1.12% 1.27% Net Interest and Investment Income 1.97% 1.97% 1.93% 1.93% 1.96% 1.90% 2.21% 2.02% 2.19% 2.12% Loan Costs 0.06% 0.08% 0.06% 0.06% 0.07% 0.06% 0.07% 0.09% 0.07% 0.07%Net Interest and Investment Income after Loan Costs 1.91% 1.90% 1.87% 1.87% 1.89% 1.84% 2.14% 1.93% 2.11% 2.05%

Other (non-interest) Income 0.50% 0.53% 0.53% 0.47% 0.50% 0.51% 0.70% 0.72% 0.71% 0.56%Net Interest, Investment and Other Income 2.41% 2.43% 2.41% 2.34% 2.39% 2.35% 2.84% 2.65% 2.82% 2.61%

Non-interest Expenses Salaries & Benefits 1.07% 1.09% 1.11% 1.10% 1.12% 1.14% 0.87% 0.90% 0.90% 1.12% Occupancy 0.19% 0.19% 0.19% 0.19% 0.19% 0.20% 0.19% 0.19% 0.15% 0.19% Computer, Office & Other Equipment 0.18% 0.19% 0.19% 0.18% 0.19% 0.19% 0.19% 0.18% 0.21%

0.66% Advertising & Communications 0.11% 0.11% 0.11% 0.10% 0.10% 0.11% 0.15% 0.13% 0.15% Member Security 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.07% Administration 0.15% 0.16% 0.17% 0.15% 0.15% 0.16% 0.19% 0.19% 0.25% Other 0.11% 0.12% 0.12% 0.10% 0.11% 0.11% 0.16% 0.17% 0.18%Total Non-interest Expenses 1.90% 1.93% 1.97% 1.91% 1.94% 1.98% 1.83% 1.84% 1.92% 1.97%

Net Income/(Loss) Before Taxes 0.51% 0.50% 0.44% 0.44% 0.45% 0.37% 1.01% 0.81% 0.90% 0.64% Taxes 0.10% 0.10% 0.08% 0.08% 0.08% 0.07% 0.23% 0.23% 0.18% 0.12%Net Income/(Loss) 0.42% 0.40% 0.35% 0.37% 0.37% 0.30% 0.79% 0.58% 0.72% 0.52%

Average Assets (millions) $58,845 $57,668 $53,212 $51,243 $50,189 $46,251 $7,601 $7,479 $6,962 $212,658


¹Includes Ontario sector, as reported by Canadian Credit Union Association, First Quarter 2018Totals may not agree due to rounding


Sector Balance SheetsAs at $millions

Sector Credit Unions Caisses Populaires

2Q-2018 1Q-2018 2Q-2017 2Q-2018 1Q-2018 2Q-2017 2Q-2018 1Q-2018 2Q-2017

ASSETS Cash and Investments 6,653 6,623 6,589 5,794 5,720 5,749 859 903 840 Personal Loans 2,338 2,302 2,785 1,684 1,654 2,076 654 648 709 Residential Mortgage Loans 32,573 31,223 28,292 28,630 27,414 24,847 3,943 3,809 3,445 Commercial Loans 15,680 15,261 13,978 13,741 13,454 12,216 1,939 1,808 1,763 Institutional Loans 108 110 109 41 41 41 67 69 69 Unincorporated Association Loans 91 80 72 81 70 61 10 10 10

Agricultural Loans 2,052 1,929 1,788 1,886 1,776 1,642 166 152 146 Total Loans 52,841 50,905 47,024 46,062 44,409 40,883 6,779 6,496 6,141 Total Loan Allowances 137 137 139 107 109 106 30 29 33 Capital (Fixed) Assets 494 492 494 456 453 455 38 39 39 Intangible and Other Assets 489 455 445 355 328 326 134 127 120Total Assets 60,340 58,337 54,414 52,560 50,801 47,307 7,780 7,536 7,107 LIABILITIES Demand Deposits 19,978 19,392 18,263 17,875 17,266 16,022 2,103 2,126 2,241 Term Deposits 16,311 15,595 14,268 14,536 13,833 12,694 1,775 1,762 1,574 Registered Deposits 11,283 11,147 10,761 9,636 9,514 9,166 1,648 1,633 1,595 Other Deposits 0 0 250 0 0 250 0 0 0 Total Deposits 47,572 46,134 43,543 42,046 40,613 38,133 5,526 5,522 5,410 Borrowings 561 790 787 54 334 31 507 456 756 Securitizations 6,723 6,228 5,297 6,357 5,898 5,120 365 330 177 Other Liabilities 1,256 1,033 1,023 571 484 902 685 549 121 Total Liabilities 56,111 54,186 50,650 49,028 47,329 44,186 7,083 6,856 6,464 MEMBERS' EQUITY & CAPITAL Membership Shares 64 63 65 62 61 62 2 2 3 Retained Earnings 2,522 2,449 2,316 1,926 1,870 1,781 596 580 535 Other Tier 1 & 2 Capital 1,631 1,632 1,365 1,544 1,545 1,278 87 87 87 AOCI 12 7 17 (1) (4) (0) 13 11 17 Total Members' Equity & Capital 4,229 4,152 3,764 3,532 3,472 3,121 698 680 643Total Liabilities, Members' Equity & Capital 60,340 58,337 54,414 52,560 50,801 47,307 7,780 7,536 7,107

* Totals may not agree due to rounding


Sector Balance Sheets

Sector Credit Unions Caisses Populaires% Increase/

(Decrease) from% Increase/

(Decrease) from% Increase/

(Decrease) from2Q-2018 1Q-2018 2Q-2017 2Q-2018 1Q-2018 2Q-2017 2Q-2018 1Q-2018 2Q-2017$millions $millions $millions

ASSETS Cash and Investments 6,653 0.5% 1.0% 5,794 1.3% 0.8% 859 -4.8% 2.3% Personal Loans 2,338 1.6% -16.0% 1,684 1.8% -18.9% 654 0.9% -7.8% Residential Mortgage Loans 32,573 4.3% 15.1% 28,630 4.4% 15.2% 3,943 3.5% 14.5% Commercial Loans 15,680 2.7% 12.2% 13,741 2.1% 12.5% 1,939 7.3% 10.0% Institutional Loans 108 -1.4% -1.0% 41 0.6% 1.7% 67 -2.6% -2.7% Unincorporated Association Loans 91 13.5% 26.6% 81 15.8% 31.6% 10 -3.0% -4.1% Agricultural Loans 2,052 6.4% 14.7% 1,886 6.2% 14.8% 166 9.0% 13.8% Total Loans 52,841 3.8% 12.4% 46,062 3.7% 12.7% 6,779 4.4% 10.4% Total Loan Allowances 137 -0.1% -1.3% 107 -1.7% 0.8% 30 6.2% -8.4% Capital (Fixed) Assets 494 0.3% -0.1% 456 0.5% 0.1% 38 -1.2% -2.0% Intangible and Other Assets 489 7.6% 9.9% 355 8.2% 9.0% 134 5.9% 12.4%Total Assets 60,340 3.4% 10.9% 52,560 3.5% 11.1% 7,780 3.2% 9.5% LIABILITIES Demand Deposits 19,978 3.0% 9.4% 17,875 3.5% 11.6% 2,103 -1.1% -6.2% Term Deposits 16,311 4.6% 14.3% 14,536 5.1% 14.5% 1,775 0.7% 12.8% Registered Deposits 11,283 1.2% 4.9% 9,636 1.3% 5.1% 1,648 0.9% 3.3% Other Deposits 0 0.0% -100.0% 0 0.0% -100.0% 0 0.0% 0.0% Total Deposits 47,572 3.1% 9.3% 42,046 3.5% 10.3% 5,526 0.1% 2.1% Borrowings 561 -29.0% -28.8% 54 -84.0% 74.6% 507 11.2% -33.0% Securitizations 6,723 7.9% 26.9% 6,357 7.8% 24.2% 365 10.7% 106.7% Other Liabilities 1,256 21.5% 22.8% 571 17.9% -36.7% 685 24.7% 465.9% Total Liabilities 56,111 3.6% 10.8% 49,028 3.6% 11.0% 7,083 3.3% 9.6% MEMBERS' EQUITY & CAPITAL Membership Shares 64 1.1% -2.2% 62 1.1% -0.4% 2 0.2% -37.8% Retained Earnings 2,522 3.0% 8.9% 1,926 3.0% 8.1% 596 2.9% 11.5% Other Tier 1 & 2 Capital 1,631 0.0% 19.5% 1,544 -0.1% 20.8% 87 0.3% -0.5%Accumulated Other Comprehensive Income 12 60.4% -31.0% (1) -83.1% 184.6% 13 10.5% -28.1%

Total Members' Equity & Capital 4,229 1.9% 12.4% 3,532 1.7% 13.1% 698 2.7% 8.6%Total Liabilities, Members' Equity & Capital 60,340 3.4% 10.9% 52,560 3.5% 11.1% 7,780 3.2% 9.5%

* Totals may not agree due to rounding


Sector Balance SheetsAs a percentage of Total Assets

Sector Credit Unions Caisses Populaires Canadian

Sector¹2Q-

2018 1Q-

2018 2Q-

20172Q-

20181Q-

20182Q-

20172Q-

20181Q-

20182Q-

2017 1Q-2018

ASSETS Cash and Investments 11.0% 11.4% 12.1% 11.0% 11.3% 12.2% 11.0% 12.0% 11.8% 14.1% Personal Loans 3.9% 3.9% 5.1% 3.2% 3.3% 4.4% 8.4% 8.6% 10.0% 4.6% Residential Mortgage Loans 54.0% 53.5% 52.0% 54.5% 54.0% 52.5% 50.7% 50.5% 48.5% 55.4% Commercial Loans 26.0% 26.2% 25.7% 26.1% 26.5% 25.8% 24.9% 24.0% 24.8% 18.8% Institutional Loans 0.2% 0.2% 0.2% 0.1% 0.1% 0.1% 0.9% 0.9% 1.0% 1.0% Unincorporated Association Loans 0.2% 0.1% 0.1% 0.2% 0.1% 0.1% 0.1% 0.1% 0.1% 0.5%

Agricultural Loans 3.4% 3.3% 3.3% 3.6% 3.5% 3.5% 2.1% 2.0% 2.1% 3.9% Total Loans 87.6% 87.3% 86.4% 87.6% 87.4% 86.4% 87.1% 86.2% 86.4% 84.3% Total Loan Allowances 0.2% 0.2% 0.3% 0.2% 0.2% 0.2% 0.4% 0.4% 0.5% 0.2% Capital (Fixed) Assets 0.8% 0.8% 0.9% 0.9% 0.9% 1.0% 0.5% 0.5% 0.6% 0.6% Intangible and Other Assets 0.8% 0.8% 0.8% 0.7% 0.6% 0.7% 1.7% 1.7% 1.7% 1.2%

Total Assets 100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100%

LIABILITIES Demand Deposits 33.1% 33.2% 33.6% 34.0% 34.0% 33.9% 27.0% 28.2% 31.5% 37.2% Term Deposits 27.0% 26.7% 26.2% 27.7% 27.2% 26.8% 22.8% 23.4% 22.1% 27.1% Registered Deposits 18.7% 19.1% 19.8% 18.3% 18.7% 19.4% 21.2% 21.7% 22.4% 14.6% Other Deposits 0.0% 0.0% 0.5% 0.0% 0.0% 0.5% 0.0% 0.0% 0.0% 0.0% Total Deposits 78.8% 79.1% 80.0% 80.0% 79.9% 80.6% 71.0% 73.3% 76.1% 79.1% Borrowings 0.9% 1.4% 1.4% 0.1% 0.7% 0.1% 6.5% 6.0% 10.6% 9.3% Securitizations 11.1% 10.7% 9.7% 12.1% 11.6% 10.8% 4.7% 4.4% 2.5% 0.0% Other Liabilities 2.1% 1.8% 1.9% 1.1% 1.0% 1.9% 8.8% 7.3% 1.7% 2.1% Total Liabilities 93.0% 92.9% 93.1% 93.3% 93.2% 93.4% 91.0% 91.0% 91.0% 91.4% MEMBERS' EQUITY & CAPITAL Membership Shares 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.0% 0.0% 0.0% 1.1% Retained Earnings 4.2% 4.2% 4.3% 3.7% 3.7% 3.8% 7.7% 7.7% 7.5% 7.5% Other Tier 1 & 2 Capital 2.7% 2.8% 2.5% 2.9% 3.0% 2.7% 1.1% 1.1% 1.2% 0.0% AOCI 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.2% 0.2% 0.2% 0.0% Total Members' Equity & Capital 7.0% 7.1% 6.9% 6.7% 6.8% 6.6% 9.0% 9.0% 9.0% 8.6%Total Liabilities, Members' Equity & Capital

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0% 100.00%


¹Includes Ontario sector, as reported by Canadian Credit Union Association, First Quarter 2018* Totals may not agree due to rounding


sector key financial trends - dico - soad€¦ · web viewin june 2018, canada housing and mortgage...

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