News Release:

November 28, 2008

ATB posts continuing growth, lower profits

Edmonton, Alberta – Growth in operating revenue, loans and deposits in the second quarter of 2008-09 underlines the steady performance of ATB Financial (“ATB”) in turbulent economic times.

ATB recorded a $5.7-million profit in the second quarter and, at September 30, 2008, reached record highs in assets ($25.2 billion, up 12.2% from last year’s second quarter), net loans ($20.5 billion, up 12.9%), and deposits, excluding wholesale ($19.6 billion, up 12.4%).

Net income of $5.7 million includes a $55.5-million increase in ATB’s provision for potential losses on holdings of asset-backed commercial paper (ABCP). This quarter’s increase is due largely to increased credit spreads and is in addition to the 2007-08 year-end ABCP provision of $253.1 million.

Excluding the impact of provisions for ABCP, net income for this quarter was $61.2 million, down 28.9% from last year’s second quarter. The decrease reflects the impact of declining margins. Also excluding ABCP, operating revenue for the quarter was $225.1 million, up 4.6% from the second quarter last year. 

“Times are getting tougher, even in resilient economies such as Alberta’s, and interest rate conditions and uncertainty in the marketplace continue to impact our business. But our continued growth and positive results mean Albertans can be confident in ATB,” said Dave Mowat, ATB’s President and CEO.

Mowat said the institution’s criteria for loans and mortgages have not changed.

“The conventional wisdom is that credit for individuals and businesses is harder to come by these days, but we are sticking by Albertans, just as we have for 70 years,” he said.

ATB’s $1.14-billion principal investment in ABCP will be converted to longer-term notes that reach maturity in six to nine years. ATB will revalue the restructured ABCP investment upon closing.

Operational Highlights

Personal and Business Financial Services (PBFS) – ATB’s largest line of business includes branches and agencies in all corners of Alberta. PBFS’s assets have grown $1.9 billion, or 12.5% over the last year. Operating revenue increased from the second quarter last year by $5.6 million, or 3.7%. During the quarter, PBFS opened new branches in Camrose, Fort McMurray, Edmonton, and Calgary, including one at SAIT Polytechnic, the first branch opened by a major financial institution on an Alberta post-secondary campus.

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 has recorded asset growth of $950.7 million, or 26.4% over the last year. Operating revenue increased from the second quarter last year by $3.8 million, or 15.4%.

ATB Investor Services (IS) – This line of business is responsible for growing and protecting wealth for more than 45,000 customers. In the quarter ended September 30, 2008, client assets under management and administration were $4.0 billion, down $63.6 million from the second quarter last year. In a Leger Marketing survey, IS was rated #1 in client satisfaction in Alberta versus the Big Five Toronto-based banks.

ATB in the Community – In the past quarter, ATB continued to support a wide range of community projects and charities, including the Stollery and Alberta Children’s Hospital Foundations, Junior Achievement of Northern Alberta and Camp He Ho Ha. In September, ATB celebrated its 70th anniversary with a week of Customer Appreciation events, in which associates from across the province performed acts of kindness in their communities.

About ATB Financial – ATB Financial is the largest Alberta-based financial institution, with assets of $25.2 billion. It provides Personal and Business Financial Services, Investor Services, and Corporate Financial Services to more than 660,000 Albertans in 244 communities. It provides service through 163 branches and 133 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 was recently named one of Alberta’s Top 40 Employers by Mediacorp Canada Inc.

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

For further information please contact:

Shawn Ohler
Director of Media Relations
ATB Financial
(780) 408-6529
e-mail: sohler@atb.com

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