LANGLEY, B.C. – DBRS Limited (DBRS Morningstar) has confirmed a Short-Term Instruments Rating of R-1 (low) and a Long-Term rating of BBB (high) to First West Credit Union, noting both trends are stable.
The ratings reflect First West’s position as the third-largest credit union in B.C. and the fifth-largest in Canada, with assets of more than $10.6 billion as at June 30, 2019. They also indicate the credit union’s well-established market position through its community-based regional brands, Envision Financial, Valley First, Enderby and District Financial and Island Savings. Notably, the report highlights First West’s solid recurring earnings and diversified revenue base, resulting in the credit union having one of the best revenue per member ratios among the large credit unions in B.C.
“First West continues to secure strong ratings that reflect our financial performance and our ability to sustain membership growth, despite an ever-changing market,” says Mark Moreland, vice-president, Finance at First West Credit Union. “Our ratings indicate a very strong credit union that continues to improve on its earnings and all financial measures, particularly with our operating expense ratio. I’m certainly very pleased as the report really highlights the strength of our multi-brand model and the collective efforts of our team members across the organization in helping us achieve such strong results.”
Other report highlights
- With a sizable capital buffer relative to regulatory minimums and high-quality capital, First West’s capitalization levels are viewed by DBRS Morningstar as strong.
- First West maintains a liquidity position that is well above regulatory requirements and asset quality remains strong with most credit metrics at relatively low and manageable levels.
- In 2018, First West generated strong net income of $57.9 million, which was up 37.3% compared with the prior year. This increase was largely driven by overall loan growth of $356 million, or 4.3%, improved net interest margin and increased fee-based revenue particularly in investment revenue, wealth management commissions and lending fee revenue.
With the largest geographic reach of any credit union in the province, First West provides expert advice, innovative financial products and services to nearly 250,000 British Columbians through its regional divisions: Envision Financial, Valley First, Enderby & District Financial and Island Savings. DBRS Morningstar is an independent, privately held, globally recognized credit ratings agency. To learn more about DRBS Morningstar, visit dbrs.com.