(Edmonton, Alberta) – Servus Credit Union reported strong third quarter operating income of $43.0 million (before patronage allocation and income taxes), boosting operating income to $116.9 million, a 9.3% increase year over year, and assets surpassed the $16 billion mark, up 6.5% for the nine months ending July 31, 2018, compared to the same period in 2017.
"Our third quarter earnings are good news for our members," said Servus Credit Union President and Chief Executive Officer Garth Warner. "We're earning enough to invest in new digital banking services, ensure our long term capital needs and set funds aside to return to members as cash and dividends in December. We have the room to offer members some unbelievable rates of return right now, with our fall GIC offer." Last year, the credit union paid over $50 million to Albertans who do their business with Servus, the largest payment in the credit union's history.
Margin for the three months ended July 31, 2018 increased by 17.5% over the same period in 2017, due to revenues from the credit card book and increases in rate (prime). This lift in revenue was somewhat offset by a 6.0% increase in operating expenses compared to Q3 FY17, due to costs related to the credit card book, ongoing software investments, and community investments this quarter.
The third quarter opened with the official amalgamation with Canada Safeway Limited Employees Savings & Credit Union Ltd. on June 1, which brought in 3,500 new members. Servus entered into a 3-year partnership with the Edmonton Eskimos and 2018 Grey Cup Festival and became the official financial institution of the Edmonton Eskimos. Servus also contributed $50,000 to Mount Royal University towards an endowment that will be used to create a scholarship in the Bachelor of Education-Elementary program.
The Center for Financial Services Innovation (CFSI) recognized Servus as one of its 2018 Financial Health Leaders in July—a recognition that is given to members of the Financial Health Network who are at the forefront of financial health measurement. IPSOS conducted the annual Servus Financial FitnessTM survey of Albertans (members and non-members) on behalf of Servus this summer.
Other key figures included (compared to Q3 FY2017):
- Total assets increased to $16.1 billion, up 6.5%
- Member loans were $14.2 billion, up 5.1%
- Deposits increased to $12.8 billion, up 2.7%
- Retained earnings increased $70.5 million, up 9.3%
- Allowance for credit losses increased to 49.9 million for the nine months ending July 31, 2018