News Release:

August 18, 2009

More business, lower earnings as ATB Financial records solid first-quarter results

Edmonton – ATB Financial (ATB) posted double-digit percentage growth over last year’s first quarter in both loans and deposits, but credit loss provisions and lower interest rates pushed profits down.

Net income in this year’s first quarter was $33.1 million, down 41.6 per cent from last year. Loans, including securitized mortgages, were up 15.7 per cent over last year’s first quarter to $23.2 billion, while retail deposits increased 10.9 per cent to $20.7 billion.

“Put simply, we’re doing more business – and good business. However, interest rates are lower and our margins are tighter,” said Dave Mowat, ATB Financial’s President and CEO.

“We are active in the marketplace meeting the financial needs of more Albertans than ever, and we’re committed to knowing and serving Albertans better than anyone else.”

Net income was also impacted by a $10.4-million increase in ATB’s allowance for credit loss expense. This increase strengthens ATB’s allowance for potential losses based on continuing economic uncertainty.

Meanwhile, Alberta businesses and investors increasingly sought out ATB as a financial partner. Business loans increased 23.9 per cent to $9.2 billion, while ATB Investor Services’ customer base grew and the assets it manages increased to $4.2 billion.

“While some might choose to scale back in times of uncertainty, ATB is strategically re-investing in Alberta,” Mowat said. “We’re ramping up our capacity to serve strong Alberta businesses, and Alberta investors who want world-class customer service and advice.”

Though markets improved in recent months, ATB’s estimate of the fair value of its investments in asset-backed commerical paper (ABCP) remains unchanged. ATB does not expect to reflect gains in the fair value of ABCP on its income statement until there is strong evidence that the assets’ value has actually increased.

Operational Highlights

Personal and Business Financial Services (PBFS) – ATB’s largest line of business includes branches and agencies throughout Alberta. Assets, primarily consisting of loans, grew $1.5 billion, or 9.7 per cent, over the last year. Operating revenue increased by $2.5 million, or 1.6 per cent. PBFS unveiled North America-leading technological and customer service innovations at two Calgary branches – Uptown/17th Avenue and Stampede Station.

Corporate Financial Services (CFS) – This line of business provides services to Alberta’s mid- and senior-market companies in three sub-lines – Energy, Commercial, and Food & Forestry. CFS’s assets grew $1.6 billion, or 38.7 per cent over the last year. Operating revenue increased over last year by $24.3 million, or 87.4 per cent.

ATB Investor Services (IS) – This line of business is responsible for growing and protecting wealth for more than 47,000 customers. At the end of the first quarter, client assets under management and administration reached $4.2 billion, up $105.7 million from last year’s first quarter, or 2.6 per cent.

ATB in the Community – ATB’s associates and customers celebrated ATB’s 10th annual Teddy for a Toonie campaign, which raises money every May for the Stollery and Alberta Children’s Hospital foundations. ATB also supported Alberta cross-country skier Sara Renner with a major Olympic-year partnership.

About ATB Financial – ATB Financial is the largest Alberta-based financial institution, with assets of $26.5 billion. It provides Personal and Business Financial Services, Investor Services, and Corporate Financial Services to 670,000 Albertans in 243 communities. It provides service through 164 branches and 132 agencies, telephone and Internet banking, a Customer Contact Centre, and Automated Banking Machines. ATB Financial was established in 1938 and has been a provincial Crown corporation since 1997. It has been named one of Canada’s 50 Best Employers by Report on Business Magazine, one of the 75 Best Workplaces in Canada by the Great Place to Work Institute, and one of Alberta’s Top 40 Employers by Mediacorp Canada Inc.

For complete first-quarter financial results, including Management’s Discussion and Analysis click here.

For further information please contact:

Shawn Ohler
Director of External and Media Relations
ATB Financial
(780) 913-8905 (cell); (780) 408-6529 (office)
e-mail: sohler@atb.com

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