Pacific and Western Bank of Canada Shares
Pacific and Western Bank of Canada, was formed in 1980 in London, Ontario. It is deemed to be a scheduled 1 bank of Canada, proud of a unique structure, which allows innovative banking to be made possible, leaving old fashioned banking practices behind. This bank operates on a unique, ‘one branch’ network. This is to say that it has no retail banking branches. This minimizes the overhead costs to maximize profits.
Small size has always been considered a drawback in the financial sector, but Pacific and Western bank considers this as its strength. Being small makes it capable of making cuts wherever possible, giving a seamless structure to the organization. It cuts not only on overhead costs of maintaining retail branches but also a huge amount of money on administrative practices. This money is invested in creating innovative technological strategies which provide banking for the future.
It provides the two basic needs of banking for the common man – deposits and financing. Utilizing a nationwide network of brokers, it generates enough deposits to sustain itself. It also focuses to provide innovative financing solutions to its clients – from small and medium size clients to big organizations like schools and colleges and even federal agencies.
The bank is a subsidiary of the Pacific and Western Credit Corp., a public company, listed on the Toronto Stock Exchange as PWC. Principal offices operate out of London Ontario, Calgary and Saskatoon. Financial services like loans are carried out of the London and Calgary Offices while the deposits are managed through the office in Saskatoon.
The growing turmoil of the last financial year had impacted the bank and its earnings. While the bank profited from the recovery of its preferred share value, taking the total regulatory capital to over C$ 127 M. The shareholders equity also increased by 28%. The increase in regulatory capital will translate into more business opportunities in the financing section of services. More capital will mean more opportunities to tap into the financing needs of its target markets.
However the net income from interest has been declining, due to the rapid decrease in interest rates. This has been reflected in the assets but not the earnings from interest from new deposits, for which the bank needs to pay lower rates. This effect will start to be felt in the last quarter of the financial year and will comfortably roll into the profits of next year as well.
This however does not mean that the bank is in trouble for its assets rose to C$ 1.6 B, compared to the C$ 1.4 billion at the end of the last financial year. Cash deposits and securities accounted for an increase to C$ 598 M, from C$447 M of last year. Mortgages and loans also increased to C$996 M from last year’s C$ 949.
Though the finances of the bank have started to look up as it recovers from the financial bad weather, the shares of the bank have suffered. They continue to report a loss of C$ 0.22 per share and this reflects in the low price of the share in today’s market. PWC shares can be bought at a listing of C$ 4 at the Toronto Stock Exchange. While the bank is recovering its losses, and things are definitely looking up, analysts do not advice investors to buy the share of the bank right now. For those who have existing shares, might look for a chance to sell, as the shares are continue to report losses.
Pacific and Western Bank of Canada is a considerably new financial organization in Canada, only over two decades old in practice. The recession hit the small but feisty organization, which now is poised to regain its losses and explore new avenues of business.