CALGARY – ATB Financial has reported a two-thirds drop in net income for the fiscal year ended in March, mainly due to provisions for possible loan losses because of the deteriorating Alberta economy.
ATB reported net income of $108 million, down from a record profit of $329 million last year.
The Alberta government-owned lender said the main reason for the drop was an increase in provisions on its balance sheet for loan losses to $388 million from $73 million the previous year.
That number is in the same ballpark as the $460 million reported by the Royal Bank (TSX:RY) and $324 million reported by CIBC (TSX:CM) earlier this week, although both federally regulated banks are much larger than ATB.
CIBC said most of its provisions were for loans related to the struggling Canadian oil and gas sector centred in Alberta.
ATB president and CEO Dave Mowat said Albertans are hurting because of low oil and gas prices and the partial shutdown of the oilsands due to wildfires in the Fort McMurray region in the northeastern part of the province.
The Edmonton-based lender noted its operating revenue grew 5.8 per cent to $1.5 billion last year, loans grew by 7.1 per cent and deposits grew by almost one per cent.
Actual loan losses for the past fiscal year were $76 million.
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