DBRS Morningstar: Central 1 Generates a Loss in Q4 2019 from Ongoing Technology Investments; F2019 Recurring Earnings Rose
Central 1 Credit Union (Central 1) reported a net loss of $9.3 million in Q4 2019, compared with a profit of $5.7 million in Q3 2019. This loss was primarily driven by Central 1’s ongoing investments in technology initiatives which are expensed each quarter. For F2019, Central 1 generated a profit from continuing operations of $6.7 million versus a loss of $11.1 million in F2018, on a comparable basis. Although Central 1’s technology investments have been a drag on earnings since Q1 2018, DBRS Limited (DBRS Morningstar) recognizes the importance of these investments given Central 1’s mandate that in-cludes supporting the operational capacity of credit unions in British Columbia (B.C.) and Ontario (ON). Going forward, the ability of Central 1 to monetize some of these investments could support growth in its noninterest income, which DBRS Morningstar would view positively.
DBRS Morningstar is a global credit ratings business with 700 employees in eight offices globally. DBRS and Morningstar Credit Ratings are committed to empowering investor success, serving the market through leading-edge technology and raising the bar for the industry.
Together, we are the world’s fourth largest credit ratings agency and a market leader in Canada, the U.S. and Europe in multiple asset classes. We rate more than 2,600 issuers and 54,000 securities worldwide and are driven to bring more clarity, diversity and responsiveness to the ratings process. Our approach and size provide the agility to respond to customers’ needs, while being large enough to provide the necessary expertise and resources. For more details visit us at dbrs.com.
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