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Canadian Western Bank expects higher provision for credit losses thanks to energy market

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Canadian Western Bank expects higher provision for credit losses thanks to energy market

updated its second-fiscal-quarter2016 provision for credit losses, providing about C$33 million for credit losseson the oil-and-gas production portfolio for the quarter, according to a news release.

The consolidatedsecond-fiscal-quarter provision for credit losses is now expected to be approximatelyC$40 million.

The Edmonton,Canada-based bank cited persistently low energy prices and borrowing base redeterminationsas reasons for the higher-than-expected provision.

The bank alsoexpects its fiscal 2016 annual provision for credit losses to come in between 35 and 45 basis points as a percentage of average loans, higherthan its previous guidanceof 18 and 23 basis points of average loans.

CanadianWestern Bank noted that the outlook is a preliminary estimate, and the full-yearfinancial performance, with the updated expectations, will be reported June 2.