Third Quarter Results
for the nine months ended December 31, 1996
Alberta Treasury Branches:
Alberta's First Choice
Alberta Treasury Branches (ATB) is well on its way in implementing "A Plan for the Future", as outlined in our Business Plan which was released in November 1996. We are determined to move ahead and are focussing on repositioning Alberta Treasury Branches as the provider of choice in three target markets -
independent business, agriculture, and individual services.
We strive to be the best in the class; and the number one choice in service, products and locations. Our efforts will continue to be focused on five key areas:
- organizing for success,
- positioning ATB as the provider of choice,
- having the best people,
- ensuring the continued integrity of the balance sheet,
- putting good management information services in place.
As a result of this new direction, operational changes will require a reinvestment in ATB. This will be a transition year in which our major focus will be placed on training, system enhancements and reorganization.
Alberta Treasury Branches will continue its review of major non-performing loans and past lending practices. This process will ensure that ATB's loan portfolio continues to be valued appropriately. The results to December 31, 1996 of this review confirm the continued conservative nature of our balance sheet by adding an additional $48.3 million to our provisions for credit impairment.
This results in a net loss of $18,857,000 to December 31, 1996.
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The change in strategy by management to lower the risk of our loan portfolio has resulted in a reduction of our loan assets. The effect on net interest income, due to the reduction of loans over the past twelve months, is balanced by increased interest spreads. Net interest income is up $1.2 million from one year earlier, for a total of $178.9 million.
Other income to December 31, 1996 is $48.9 million, up 3.5% from the same period last year. The increases in other income are a result of processing higher transaction volumes without increasing the fees and charges to our customers.
Non-interest expenses totalled $158.4 million, which is a 4.1% increase over
the same period last year. The increases are primarily in the areas of branch automation and new technology initiatives used to improve our financial service delivery systems.
An Asset Recovery team consisting of highly-trained credit professionals has been formed to take action on all non-performing loans. On November 26, 1996, Don Roberts was appointed by the Board of Directors as Senior Vice President, Asset Recovery.
One of the key directions in our Business Plan is to organize for success. To increase Alberta Treasury Branches' visibility and decision-making capabilities within geographic regions, a regional office structure for our branches and agencies throughout Alberta has been implemented. A total of eleven regions that group similar trading areas have been created, with twelve to fifteen branches within each region. Due to their size and unique portfolios, Calgary Main and Edmonton Main will operate as separate entities.
The new regional network will be fully implemented by July 1997.
On January 27, 1997, the following appointments were announced as part of the regional network:
- Region 1, Grande Prairie
Ron Metro, Regional Vice President
- Region 2, Westlock
Sandra Whicker, Regional Vice President
- Region 3, Stony Plain
John Ireland, Regional Vice President
- Region 4, Vegreville
Marvin Bragg, Regional Vice President
- Region 5, Edmonton
Mike Ryan, Regional Vice President
- Region 6, Edmonton
Jay Hamblin, Regional Vice President
- Region 7, Red Deer
Doug Posmituck, Regional Vice President
- Region 8, Stettler
Kerry Dalton, Regional Vice President
- Region 9, Calgary
Robert Sutherland, Regional Vice President
- Region 10, Claresholm
Kelly Burgess, Regional Vice President
- Region 11, Lethbridge
Dennis Tarrant, Regional Vice President
- Region 12, Edmonton Main
Deane Fossen, Regional Vice President and Manager
- Region 13, Clagary Main
Vic Neufeld, Regional Vice President and Manager
With the new regional network, decision-making capabilities within geographic areas will be enhanced.
The Regional Vice Presidents will be responsible for sales, marketing and loan origination functions within each region. Staffing for each region will include the Regional Vice President, a Regional Credit Manager, a Personal Sales Manager and in some cases, two or three specialists (such as an agrologist) representing ATB's three target market areas: independent business, agricultural operations and individual services.
Management, with the full support of the Board of Directors, is determined to be part of the strong future for the province, putting Albertans and Alberta first.
Paul G. Haggis
Chief Executive Officer
and Superintendent
Marshall Williams
Chairman of the Board
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