Canadian Western Bank Posts Lower Profit Amidst Trucking Industry Downturn

A Canadian Western Bank building in Toronto. The Edmonton-based bank reported lower than expected fourth-quarter profit on Wednesday, partly because CWB was forced to set aside $40-million in new provisions against potentially bad loans.The Edmonton-based lender reported lower than expected fourth-quarter profit on Wednesday, partly because CWB was forced to set aside $40-million in new provisions against loans that could default.

That figure was nearly double what Bay Street analysts were expecting and CWB said provisions are likely to remain elevated until after its sale to National Bank of Canada is expected to be completed early next year. CWB said Wednesday that an “in-depth investigation” has since determined “this matter has no impact on our financial statements.” Collapsing valuations in the trucking industry, however, did impact CWB’s finances in its latest quarter and the lender expects the fallout will persist well into 2025. “We expect to see continued pressure in the first half of the year related to both impairments and provision levels,” chief risk officer Carolina Parra told analysts on a Wednesday morning conference call. “That would translate into slightly higher losses as well when we look at the trend for the next year. Then we expect that to normalize, not normalize, but trend towards the end of 2025 to more normal levels in 2026.” Trucking inventory has “flooded the market from large players that have disposed of their assets,” Ms. Parra said. Pride was given two months to find a way to restructure. Liquidation, the company argued in its request for creditor protection, would result in “thousands of trucks being sold on the market at once, which would decimate the value of trucks across the North American marke

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