Canada Dividend Investor: CWB - <span class="simulate_din_font">CWB reports strong earnings and record quarterly revenues</span> (CAD 0.15)

Company: Cdn Western Bank
Stock Name: CWB
Amount: CAD 0.15
Announcement Date: 07/03/2012
Record Date: 20/03/2012

Dividend Detail:

Very strong loan growth of 4% in the quarter and 15% over the past
twelve months

Quarterly dividend declared of $0.15 per CWB common share

Quarterly dividend declared on CWB preferred shares

First Quarter 2012 Highlights⁽¹⁾ (compared to the same period in the prior year)

Record total revenues, on a taxable equivalent basis (teb)⁽²⁾, of $126.3 million, up 4% ($4.9 million).

Very strong loan growth of 4% in the quarter and 15% over the past
twelve months.

Net income available to common shareholders of $41.5 million, up 10%
($3.6 million).

Diluted earnings per common share of $0.54, up 8%.

Adjusted cash earnings per common share⁽²⁾ of $0.57, up 4%.

Solid regulatory capital position supported by a tangible common equity
to risk-weighted assets ratio⁽²⁾ of 8.2%, Tier 1 capital ratio of 10.2% and total capital ratio of
14.6%.

Total assets surpassed the $15 billion milestone.

On March 7, declared a quarterly dividend of $0.15 per CWB common share,
unchanged from the prior quarter and up 15% over the quarterly dividend
declared a year earlier.

⁽¹⁾	Effective this quarter, CWB's unaudited interim consolidated financial statements, including comparative information, and the accompanying Management's Discussion and Analysis (MD&A) are prepared in accordance with International Financial Reporting Standards (IFRS).
⁽²⁾	Non-GAAP measure - refer to definitions following the table of Selected Financial Highlights on page 3.

EDMONTON, March 7, 2012 /CNW/ - Canadian Western Bank (TSX: CWB) (CWB or
the Bank) today announced strong financial performance marking the
Bank's 95^th consecutive profitable quarter. Net income available to common
shareholders of $41.5 million increased 10% compared to the same
quarter last year, while adjusted cash earnings per common share of
$0.57 was up 4%. Record total revenues (teb) of $126.3 million
represented a 4% increase over the same quarter last year as the
positive impact of very strong loan growth was partially offset by a 30
basis point reduction in net interest margin (teb) and 7% lower other
income.

Compared to the previous quarter, net income available to common
shareholders increased 15%, while adjusted cash earnings per common
share was up 8%. Total revenues (teb) grew 6% as positive contributions
from significantly higher other income and 4% quarterly loan growth
offset the impact of a 10 basis point reduction in net interest margin
(teb).

"CWB Group's strong first quarter performance is a great way to start
the year," said Larry Pollock, President and CEO. "Quarterly loan
growth exceeded our expectations and was supported by strong
contributions from all of our businesses. We are well positioned in
relation to all of our 2012 performance targets despite considerable
pressure over the past two quarters on net interest margin. Looking
forward, while we expect there will be ongoing challenges related to
very low interest rates and increased competition, we believe recent
downward pressure on net interest margin will moderate as we prudently
reduce liquidity and replace maturing term deposits at comparatively
lower rates. The anticipated redemption of $125 million of subordinated
debentures in March 2012 will also help offset recent margin
compression."

"Overall credit quality continues to improve and very strong first
quarter loan growth will benefit earnings and revenues for the
remainder of the year. Business activity across all areas of our
geographic footprint supports our optimism about Western Canada's
economic outlook, particularly over the longer term, but we also remain
cautious about potential impacts in our markets from global economic
uncertainties, including ongoing turmoil in Europe."

The quarterly return on common shareholders' equity of 15.5% was down 40
basis points compared to a year earlier as the benefit of increased net
income was partially offset by comparatively higher percentage growth
in the balance of common shareholders' equity. Equity growth compared
to a year earlier mainly resulted from the retention of earnings and
the issuance of common shares upon the exercise of warrants, partially
offset by the redemption of warrants completed in August 2011. Compared
to the previous quarter, return on common shareholders' equity
increased 190 basis points mainly reflecting increased earnings.
Quarterly return on assets of 1.07% was down from 1.15% last year, but
up from 0.97% in the previous quarter.

Overall credit quality remained satisfactory and continued to show
improvement from prior quarters. Gross impaired loans totaled $90.9
million at quarter end, compared to $97.3 million last quarter and
$132.9 million a year earlier. This represented the seventh consecutive
quarter of reductions in the dollar level of gross impaired loans from
the peak level reached in the second quarter of 2010.

Outlook

The Bank's strong first quarter performance represents an excellent
start for fiscal 2012. We believe Canada will see modest growth this
year despite the ongoing impact of global economic uncertainties,
including the European debt crisis. Although it is still early in the
year, we are also optimistic about the Bank's ability to meet or
surpass all of our 2012 minimum performance targets. Strong loan growth
was apparent across all lending sectors in the first quarter reflecting
ongoing economic activity in each of our key western Canadian markets.
While challenges related to the very low interest rate environment and
increased competition will persist, we believe recent downward pressure
on net interest margin will moderate going forward. Strong performance
is expected from each company of the CWB Group and the ongoing growth
of these businesses should continue to augment earnings and further
diversify operations. While we are cautious and will continue to
monitor economic factors and other developments closely, the current
overall outlook for 2012 and beyond is positive. We look forward to
reporting our second quarter results on June 7, 2012.

Fiscal 2012 First Quarter Results Conference Call

CWB's first quarter results conference call is scheduled for Thursday,
March 8, 2012 at 3:00 p.m. ET (1:00 p.m. MT). The Bank's executives will comment on financial results and respond
to questions from analysts and institutional investors.

The conference call may be accessed on a listen-only basis by dialing
647-427-7450 or toll-free 1-888-231-8191. The call will also be webcast
live on the Bank's website, www.cwbankgroup.com.

A replay of the conference call will be available until March 22, 2012
by dialing 416-849-0833 (Toronto) or 1-855-859-2056 (toll-free) and
entering passcode 51521762.

About Canadian Western Bank Group

Canadian Western Bank offers a full range of business and personal
banking services across the four western provinces and is the largest
publicly traded Canadian bank headquartered in Western Canada. The
Bank, along with its operating affiliates, National Leasing Group Inc.,
Canadian Western Trust Company, Valiant Trust Company, Canadian Direct
Insurance Incorporated, Adroit Investment Management Ltd. and Canadian
Western Financial Ltd., collectively offer a diversified range of
financial services across Canada and are together known as the Canadian
Western Bank Group. The common shares of Canadian Western Bank are
listed on the Toronto Stock Exchange under the trading symbol "CWB".
The Bank's Series 3 Preferred Shares trade on the Toronto Stock
Exchange under the trading symbol "CWB.PR.A". Refer to www.cwbankgroup.com for additional information.

Selected Financial Highlights

			For the three months ended									Change from
(unaudited)				January 31			October 31			January 31		January 31
($ thousands, except per share amounts)				2012			2011			2011		2011
Results of Operations
	Net interest income (teb - see below)		$	107,509		$	106,184		$	101,218		6	%
	Less teb adjustment			2,620			3,133			2,744		(5)
	Net interest income per financial statements			104,889			103,051			98,473		7
	Other income			18,791			13,489			20,146		(7)
	Total revenues (teb)			126,300			119,673			121,363		4
	Total revenues			123,680			116,540			118,619		4
	Net income available to common shareholders			41,478			35,921			37,852		10
	Earnings per common share
		Basic ⁽¹⁾		0.55			0.48			0.56		(2)
		Diluted ⁽²⁾		0.54			0.47			0.50		8
		Adjusted cash ⁽³⁾		0.57			0.53			0.55		4
	Return on common shareholders' equity ⁽⁴⁾			15.5	%		13.6	%		15.9	%	(40)	bp⁽⁵⁾
	Return on assets ⁽⁶⁾			1.07			0.97			1.15		(8)
	Efficiency ratio (teb) ⁽⁷⁾			43.7			45.5			44.5		(80)
	Efficiency ratio			44.6			46.7			45.5		(90)
	Net interest margin (teb) ⁽⁸⁾			2.77			2.87			3.07		(30)
	Net interest margin			2.70			2.79			2.99		(29)
	Provision for credit losses as a percentage of average loans			0.20			0.17			0.23		(3)
Insurance Summary
	Insurance net earned premium		$	30,454		$	30,252		$	28,996		5
	Claims loss ratio ⁽⁹⁾			67	%		64	%		66	%	100	bp
	Combined ratio ⁽¹⁰⁾			96			93			95		100
Per Common Share
	Cash dividends		$	0.15		$	0.14		$	0.13		15	%
	Book value			14.36			13.87			13.95		3
	Closing market value			26.47			28.50			29.64		(11)
	Common shares outstanding (thousands)			75,694			75,462			69,703		9
Balance Sheet and Off-Balance Sheet Summary
	Assets		$	15,484,048		$	14,849,141		$	13,098,697		18
	Loans			12,744,891			12,293,282			11,035,921		15
	Deposits			12,960,929			12,394,689			10,681,341		21
	Debt			685,049			634,877			716,812		(4)
	Shareholders' equity			1,296,634			1,256,613			1,182,169		10
	Assets under administration			6,912,244			9,369,589			9,013,307		(23)
	Assets under management			843,648			816,219			804,486		5
Capital Adequacy ⁽¹¹⁾
	Tangible common equity to risk-weighted assets ⁽¹²⁾			8.2	%		8.6	%		8.9	%	(70)	bp
	Tier 1 ratio			10.2			11.1			11.6		(140)
	Total ratio			14.6			15.4			16.5		(190)

⁽¹⁾	Basic earnings per common share is calculated as net income available to common shareholders divided by the average number of common shares outstanding.
⁽²⁾	Diluted earnings per common share is calculated as net income available to common shareholders divided by the average number of common shares outstanding adjusted for the dilutive effects of stock options and warrants.
⁽³⁾	Adjusted cash earnings per common share is diluted earnings per common share excluding the after-tax amortization of acquisition-related intangible assets and the non-tax deductible change in fair value of contingent consideration. These exclusions represent non-cash charges mainly related to the acquisition of National Leasing Group Inc. and are not considered to be indicative of ongoing business performance. The Bank believes the adjusted results provide the reader with a better understanding about how management views CWB's performance.
⁽⁴⁾	Return on common shareholders' equity is calculated as annualized net income available to common shareholders divided by average common shareholders' equity.
⁽⁵⁾	bp - basis point change.
⁽⁶⁾	Return on assets is calculated as annualized net income available to common shareholders divided by average total assets.
⁽⁷⁾	Efficiency ratio is calculated as non-interest expenses divided by total revenues excluding the non-tax deductible change in fair value of contingent consideration.
⁽⁸⁾	Net interest margin is calculated as annualized net interest income divided by average total assets.
⁽⁹⁾	Claims loss ratio is net insurance claims and adjustment expenses as a percentage of net earned premiums.
⁽¹⁰⁾	Combined ratio is the sum of the claims loss ratio and the expense ratio. The expense ratio is defined as policy acquisition costs and non-interest expenses, net of commissions and processing fees, as a percentage of net earned premiums.
⁽¹¹⁾	Capital adequacy is calculated in accordance with Basel II guidelines issued by the Office of the Superintendent of Financial Institutions Canada (OSFI). The 2011 ratios reflect the returns filed and have not been restated to IFRS.
⁽¹²⁾	Tangible common equity to risk-weighted assets is calculated as shareholders' equity less subsidiary goodwill divided by risk-weighted assets, calculated in accordance with guidelines issued by OSFI. The 2011 ratios reflect the returns filed and have not been restated to IFRS.

Taxable Equivalent Basis (teb)

Most banks analyze revenues on a taxable equivalent basis to permit
uniform measurement and comparison of net interest income. Net interest
income (as presented in the consolidated statement of income) includes
tax-exempt income on certain securities. Since this income is not
taxable, the rate of interest or dividends received is significantly
lower than would apply to a loan or security of the same amount. The
adjustment to taxable equivalent basis increases interest income and
the provision for income taxes to what they would have been had the
tax-exempt securities been taxed at the statutory rate. The taxable
equivalent basis does not have a standardized meaning prescribed by
IFRS and, therefore, may not be comparable to similar measures
presented by other banks. Total revenues, net interest income and
income taxes are discussed on a taxable equivalent basis throughout
this quarterly report to shareholders.

Non-GAAP Measures

Taxable equivalent basis, adjusted cash earnings per common share,
return on common shareholders' equity, return on assets, efficiency
ratio, net interest margin, provision for credit losses as a percentage
of average loans, claims loss ratio, combined ratio and tangible common
equity to risk-weighted assets do not have standardized meanings
prescribed by IFRS and therefore may not be comparable to similar
measures presented by other financial institutions.

Management's Discussion and Analysis

This management's discussion and analysis (MD&A) should be read in
conjunction with Canadian Western Bank's (CWB or the Bank) unaudited
interim consolidated financial statements for the period ended January
31, 2012 and the audited consolidated financial statements and MD&A for
the year ended October 31, 2011, available on SEDAR at www.sedar.com and the Bank's website at www.cwbankgroup.com. CWB's financial results for the quarter ending January 31, 2012
represent the first quarterly financial statements prepared under
International Financial Reporting Standards (IFRS). Except where
indicated below, the factors discussed and referred to in the MD&A for
fiscal 2011 remain substantially unchanged.

Commencing this quarter, the operating results are presented as one
segment - Banking and Financial Services - operating in one geographic region - Canada.

Overview

CWB recorded its 95^th consecutive profitable quarter highlighted by record total revenues and
very strong loan growth of 4% in the quarter and 15% over the past
twelve months. Net income available to common shareholders of $41.5
million increased 10% ($3.6 million) compared to the same quarter last
year while diluted earnings per common share was up 8% to $0.54.
Adjusted cash earnings per common share, which excludes the after-tax
amortization of acquisition-related intangible assets and the non-tax
deductible change in fair value of contingent consideration, was $0.57,
up 4%. Lower percentage growth in diluted earnings per common share
compared to net income mainly reflects the dilutive impact of 8.1
million CWB common shares issued between December 2010 and August 2011
upon the exercise of warrants.

Compared to the previous quarter, net income available to common
shareholders was up 15% ($5.6 million) as the positive contribution
from loan growth and higher other income largely attributed to a $5.0
million positive change in net gains on securities more than offset the
impact of a 10 basis point reduction in net interest margin. Quarterly
diluted earnings per common share increased 15% ($0.07) while adjusted
cash earnings per common share was up 8% ($0.04).

The quarterly return on common shareholders' equity of 15.5% decreased
40 basis points from the same quarter last year as a material increase
in common shareholders' equity more than offset the positive influence
of higher net income. The retention of profits to support ongoing
growth and the issuance of CWB common shares upon the exercise of
warrants were the main factors contributing to the increase in common
shareholders' equity, partially offset by the impact of warrants
purchased for cancellation. Compared to the previous quarter, return on
common shareholders' equity increased 190 basis points reflecting
strong earnings growth and the impact of the warrant redemption
completed in August 2011. First quarter return on assets of 1.07% was
down eight basis points from a year earlier, but up 10 basis points
compared to the previous quarter.

Total Revenues (teb)

Total revenues, comprising both net interest income and other income,
reached a record $126.3 million for the quarter, up 4% ($4.9 million)
compared to a year earlier. Growth in net interest income from very
strong loan growth was constrained by a 30 basis point reduction in net
interest margin, while other income was down 7% ($1.4 million)
reflecting $2.3 million lower net gains on securities. Compared to the
previous quarter, total revenues were up 6% ($6.6 million) mainly
driven by a $5.0 million positive change in net gains on securities and
very strong quarterly loan growth, partially offset by a 10 basis point
reduction in net interest margin.

Net Interest Income (teb)

Quarterly net interest income of $107.5 million grew 6% ($6.3 million)
over the same quarter last year reflecting the combined influence of
very strong 15% loan growth, largely offset by the impact of a 30 basis
point reduction in net interest margin to 2.77%. The deterioration in
net interest margin compared to the same quarter in 2011 was mainly
attributed to lower yields on loans and securities, partially offset by
more favourable fixed term deposit costs. Lower asset yields reflect
the combined impact of the very low interest rate environment, a flat
interest rate curve as well as ongoing competitive pressures. Net
interest margin was further impacted by higher average liquidity
maintained in response to elevated global uncertainties, as well as
anticipated requirements for near-term maturities of certain fixed term
deposits and the redemption of subordinated debentures in March 2012.

Compared to the previous quarter, net interest income increased 1% ($1.3
million) as the positive impact of very strong 4% loan growth was
largely offset by a 10 basis point reduction in net interest margin.
Margin compression compared to the prior quarter mainly resulted from
higher liquidity and a lower average yield on securities. Based on
management's current view, including consideration of the Bank's
current composition of assets and liabilities and expectations for
reduced liquidity requirements moving forward, recent downward pressure
on net interest margin is expected to moderate, helping to offset the
impact of ongoing competitive pressures. Future increases in interest
rates or a notable steepening of the interest rate curve would
positively impact net interest margin.

Note 13 to the unaudited interim consolidated financial statements
summarizes the Bank's exposure to interest rate risk as at January 31,
2012. The estimated sensitivity of net interest income to a change in
interest rates is presented in the table below. The amounts represent
the estimated change in net interest income that would result over the
following twelve months from a one-percentage point change in interest
rates. The January 31, 2012 estimates are based on a number of
assumptions and factors, which include:

a constant structure in the interest sensitive asset and liability
portfolios;

floor levels for various deposit liabilities;

interest rate changes affecting interest sensitive assets and
liabilities by proportionally the same amount and applied at the
appropriate repricing dates; and

no early redemptions.


	January 31 2012			October 31 2011			January 31 2011
($ thousands)	January 31 2012			October 31 2011			January 31 2011

Estimated impact on net interest income of a 1% increase in interest rates
1 year	$	13,519		$	11,024		$	8,894
1 year percentage change		3.7	%		3.0	%		2.7	%

Estimated impact on net interest income of a 1% decrease in interest rates
1 year	$	(16,549)		$	(13,436)		$	(11,938)
1 year percentage change		(4.5)	%		(3.7)	%		(3.7)	%

It is estimated that a one-percentage point increase in all interest
rates at January 31, 2012 would decrease unrealized gains related to
available-for-sale securities and result in a reduction in other
comprehensive income of approximately $10.1 million, net of tax
(January 31, 2011 - $8.2 million); it is estimated that a
one-percentage point decrease in all interest rates at January 31, 2012
would result in a higher level of unrealized gains related to
available-for-sale securities and increase other comprehensive income
by similar amounts.

Management will continue to manage the asset liability structure and
interest rate sensitivity within the Bank's established policies
through pricing and product initiatives, as well as the use of interest
rate swaps and other appropriate strategies.

Other Income

First quarter other income of $18.8 million was down 7% ($1.4 million)
from a year earlier as growth in credit related fee income ($0.4
million), trust and wealth management fees and the positive impact of
$1.3 million lower contingent consideration fair value change was more
than offset by $2.3 million lower net gains on securities and a $0.6
million reduction in the 'other' component of other income. The level
of gains on securities in the first quarter last year was mainly
realized due to a reduction in the Bank's investments in preferred
shares of other financial institutions. The decision to reposition a
portion of these preferred shares reflects forthcoming changes under
the new regulatory capital framework known as Basel III that requires a
deduction from regulatory capital or an increase in risk weightings for
amounts over a certain threshold for investments in other financial
institutions. Based on the current composition of the securities
portfolio and elevated volatility in financial markets resulting from
ongoing global uncertainties, CWB expects the future level of quarterly
net gains on securities will be similar to or below that achieved in
the current quarter. The reduction in the 'other' category of other
income compared to the same period last year resulted from a
combination of lower revenue contributions resulting from the
termination of a lease servicing contract during the current quarter,
partially offset by contributions from the finalization of loan
realization assets and a positive change in fair value of certain
interest rate swaps recognized in the first quarter last year.
Quarterly net insurance revenues, retail services and foreign exchange
gains each showed modest decreases compared to the same period a year
earlier.

Other income was up $5.3 million compared to the previous quarter mainly
reflecting a $5.0 million positive change in net gains on securities.
Net gains on securities of $1.9 million in the first quarter compared
to net losses of $3.1 million in the previous period. The first quarter
contingent consideration fair value change of $1.2 million compares to
$3.5 million in the previous period. The net benefit to other income of
a $2.3 million lower charge for contingent consideration was largely
offset by a $2.1 million reduction in the 'other' category of other
income, which in the fourth quarter of 2011 included $1.9 million from
the sale of a residential mortgage portfolio. Net insurance revenues
were down $0.5 million as the benefit of growth in net earned premiums
was offset by increased claims expense in the home insurance line of
business, largely attributed to windstorms in southern Alberta.

Credit Quality

Overall credit quality remained satisfactory and within expectations in
view of favourable economic activity and a relatively positive outlook
in Western Canada despite ongoing global uncertainties. The dollar
level of gross impaired loans decreased for the seventh consecutive
quarter. Compared to both the previous quarter and a year earlier, the
total number of accounts classified as impaired was also down.

		For the three months ended									Change from January 31 2011
(unaudited)		January 31 2012			October 31 2011			January 31 2011
($ thousands)		January 31 2012			October 31 2011			January 31 2011

Gross impaired loans, beginning of period		$	97,258		$	108,117		$	143,700		(32)	%
	New formations		18,928			14,100			32,888		(42)
	Reductions, impaired accounts paid down or returned to performing status		(20,787)			(18,455)			(33,240)		63
	Write-offs		(4,542)			(6,504)			(10,417)		44
Total⁽¹⁾		$	90,857		$	97,258		$	132,931		(32)	%

Balance of the ten largest impaired accounts		$	44,252		$	46,884		$	63,909		(44)	%
Total number of accounts classified as impaired⁽³⁾			139			153			195		(40)
Gross impaired loans as a percentage of total loans⁽³⁾			0.71	%		0.79	%		1.20	%	(49)	bp⁽²⁾

(1)	Gross impaired loans includes foreclosed assets held for sale with a carrying value of $4,683 (October 31, 2011 - $3,241 and January 31, 2011 - $1,591).
(2)	bp - basis point change.
(3)	Total loans do not include an allocation for credit losses or deferred revenue and premiums.

Gross impaired loans at January 31, 2012 were $90.9 million, compared to
$97.3 million last quarter and $132.9 million a year earlier. The ten
largest accounts classified as impaired, measured by dollars
outstanding, represented approximately 49% of total gross impaired
loans, relatively consistent with prior periods. New formations of
impaired loans totaled $18.9 million, compared to $14.1 million last
quarter and $32.9 million a year earlier.

The dollar level of gross impaired loans represented 0.71% of total
loans at quarter end, compared to 0.79% last quarter and 1.20% one year
ago. While the trends are positive, management expects the dollar level
of gross impaired loans will fluctuate from the current level until
global uncertainties subside and overall economic conditions strengthen
further. The dollar level of gross impaired loans goes up and down as
loans become impaired and are subsequently resolved and does not
directly reflect the dollar value of expected write-offs given the
tangible security held against the Bank's lending positions. The Bank
establishes its current estimates of expected write-offs through
detailed analyses of both the overall quality and ultimate
marketability of the security held against impaired accounts. Actual
credit losses are expected to remain within the Bank's historical range
of acceptable levels.

The first quarter provision for credit losses measured against average
loans of 20 basis points was at the low end of the Bank's 2012 target
range of 20 to 25 basis points. This result reflects ongoing positive
credit trends in the equipment leasing portfolio and consistent
expectations for credit quality in other areas. Based on the current
environment and outlook, management believes the annual provision for
credit losses will remain within the 2012 target range.

The total allowance for credit losses (collective and specific)
represented 82% of gross impaired loans at quarter end, compared to 74%
last quarter and 58% one year ago. The total allowance for credit
losses was $74.6 million at January 31, 2012, compared to $72.0 million
last quarter and $77.6 million a year earlier. The reduction in the
total allowance for credit losses compared to the same period last year
was entirely attributed to lower specific allowances. The collective
allowance at January 31, 2012 was $62.7 million, compared to $61.3
million last quarter and $62.2 million a year earlier. The collective
allowance as a percentage of risk-weighted loans was 57 basis points,
unchanged from last quarter and down from 66 basis points one year ago.
The decline in the collective allowance as a percentage of
risk-weighted loans resulted from very strong loan growth. An enhanced
methodology has been developed to estimate the collective allowance for
credit losses. No material change on transition to IFRS was realized in
the overall level of the collective allowance; however, the revised
methodology has potential to increase volatility in the quarterly
provision for credit losses.

Non-interest Expenses

One of management's key priorities is to maintain effective control of
costs while ensuring the Bank is positioned to deliver strong growth
over the long term. Effective execution of CWB's strategic plan will
continue to require increased investment in certain areas. Significant
anticipated expenditures relate to additional staff complement as well
as expanded infrastructure and further technology upgrades. The
majority of investment in these areas is aligned with the Bank's
commitment to maximize shareholder value and is expected to provide
material benefits in future periods. Ongoing compliance with an
ever-increasing level of regulatory rules and oversight for all
Canadian banks requires the investment of both time and resources,
which further contributes to higher non-interest expenses. A new
full-service branch is expected to open in Winnipeg, Manitoba in the
fourth quarter of 2012. Other potential new branch locations are
currently under consideration. Upgrades and expansion of existing
branch infrastructure will also continue.

Compared to the same quarter last year, non-interest expenses of $55.7
million were up 1% ($0.5 million) as increases in salary and benefit
costs, and premises and equipment expenses of $0.8 million and $0.6
million, respectively, were offset by a $0.8 million reduction in
general expenses. The change in salary and benefit costs was driven by
a combination of increased staff complement to support ongoing growth
and annual salary increments, partially offset by lower expense related
to restricted share units. The increase in premises and equipment
expense includes the addition of a new full-service branch opened in
Richmond, British Columbia (BC) in the latter part of 2011, as well as
ongoing expansion and upgrades to existing infrastructure and
technology. Within general expenses, capital and business taxes were
down $1.0 million reflecting the final payment of BC capital taxes in
the first quarter of 2011.

Compared to the previous quarter, non-interest expenses were down $0.4
million as lower general expenses were largely offset by $1.2 million
higher salary and benefit costs related to increased staff complement
and annual salary increments. Within general expenses, marketing and
business development costs were down $1.2 million reflecting the timing
of expenses related to ongoing initiatives to enhance awareness of the
Bank's brand and product offerings. Reductions in professional fees and
travel expenses of $0.5 million and $0.4 million, respectively, were
largely offset by higher community investment and insurance costs.

The first quarter efficiency ratio (teb), which measures non-interest
expenses as a percentage of total revenues (teb) excluding the non-tax
deductible change in fair value of contingent consideration, was 43.7%,
compared to 44.5% last year and 45.5% in the previous quarter. Given
expected revenue growth and planned expenditures, management believes
the 2012 target for the efficiency ratio of 46% or better will be
achieved.

Income Taxes

The first quarter income tax rate (teb) was 26.7%, down from 27.6% one
year ago, while the tax rate before the teb adjustment was 23.6%,
compared to 24.2% last year. The reduction mainly reflects the 150
basis point decrease in the basic federal income tax rate and the 50
basis point reduction in the provincial income tax rate in BC, both
effective January 1, 2011.

Comprehensive Income

Comprehensive income is comprised of net income and other comprehensive
income (OCI), all net of income taxes, and totaled $52.9 million for
the first quarter, compared to $38.5 million in the same period last
year. The increase in comprehensive income was driven by a $10.8
million positive change in OCI related to favourable market value
fluctuations in available-for-sale securities and 8% ($3.6 million)
higher net income. While the combined dollar investment in preferred
shares and common equities is relatively small in relation to total
liquid assets, it increases the potential for comparatively larger
fluctuations in OCI.

Balance Sheet

Total assets surpassed the $15 billion milestone, increasing 4% ($635
million) in the quarter and 18% ($2,385 million) in the past year to
reach $15,484 million at January 31, 2012.

Cash and Securities

Cash, securities and securities purchased under resale agreements
totaled $2,429 million at January 31, 2012, compared to $2,238 million
last quarter and $1,754 million one year ago (refer to the Treasury Management section of this MD&A for additional details). Net unrealized gains
recorded on the balance sheet at January 31, 2012 were $18.8 million,
compared to $10.9 million at October 31, 2011 and $27.2 million a year
earlier. The change in unrealized gains compared to the same time last
year was mainly attributed to net gains realized through the statements
of income and fluctuations in the market value of the Bank's investment
in common equities and preferred shares. Compared to the prior quarter,
the change in net unrealized gains mainly reflects increased market
values within the preferred equities portfolio. The securities
portfolio is primarily comprised of high quality debt instruments,
preferred shares and common shares that are not held for trading
purposes and, where applicable, are typically held until maturity.
Fluctuations in value are generally attributed to changes in interest
rates, movements in market credit spreads and shifts in the interest
rate curve. Volatility in equity markets also leads to fluctuations in
value, particularly for common shares.

Net realized gains on securities in the first quarter of $1.9 million
compares to $4.2 million in the same period last year. In the previous
quarter, impairments recognized on certain equity investments resulted
in a $3.1 million net loss on securities. The majority of gains on
securities in the current quarter resulted from the repositioning of
certain fixed income investments. Based on the current composition of
the securities portfolio and elevated volatility in financial markets
resulting from ongoing global uncertainties, CWB expects the future
level of quarterly net gains on securities will be similar to or below
that achieved in the current quarter. The Bank has no direct investment
in any non-Canadian sovereign debt or other securities outside of
Canada or the United States.

Treasury Management

The Bank continues to refine its methodologies for measuring and
monitoring liquidity risk. Use of dynamic scenario analysis has allowed
for a reduction in liquid asset coverage while maintaining prudent
liquidity standards. In view of elevated market risks mainly attributed
to ongoing global economic uncertainties, including the European debt
crisis, the composition of liquid assets will continue to include a
higher balance of cash resources and low yielding government securities
compared to what would be held in a more normal market environment.
That being said, average liquidity is expected to trend lower compared
to the levels maintained over the past two quarters. The strategy to
maintain higher than normal liquidity has a negative impact on net
interest margin but is considered appropriate in view of the current
macro economic environment.

DBRS Limited maintains published credit ratings on the Bank's senior
debt (deposits) and subordinated debentures of "A (low)" and "BBB
(high)", respectively, both with a stable outlook. Credit ratings do
not comment on market price or suitability of any financial instrument
for a particular investor and are not recommendations to purchase, sell
or hold securities. Ratings are subject to revision or withdrawal at
any time by the rating organization. Management believes the ratings
widen the base of clients and investors who can participate in CWB's
deposit and debt offerings while also lowering the Bank's overall cost
of capital.

The Bank for International Settlements (BIS) finalized liquidity
proposals initially described in its document "International Framework
for Liquidity Risk, Measurement, Standards and Monitoring." The
proposals as outlined remain subject to significant transition and
monitoring activities, and revisions are expected. The new liquidity
coverage ratio (LCR) and net stable funding ratio (NSFR) are presently
subject to an observation period and include a review clause to address
any unintended consequences. It is too early to tell how this framework
will impact CWB. The BIS is currently expected to introduce the LCR
effective January 1, 2015 and the NSFR effective January 1, 2018.

Loans

Total loans of $12,745 million grew 4% ($452 million) in the quarter and
15% ($1,709 million) in the past twelve months. The level of quarterly
growth measured in both dollar and percentage terms was led by activity
in general commercial lending, and equipment financing and leasing.
Positive quarterly growth was also realized in both real estate
lending, and personal loans and mortgages, while the amount of oil and
gas production loans was relatively unchanged. Measured by geographic
concentration, lending activity in Alberta showed the highest quarterly
growth while performance in other areas was also strong. Over the past
twelve months, strong double-digit growth is apparent across all
lending sectors and each geographic market with the only exception
being Manitoba, where loans are up by slightly less than 10%.

While there is increased competition in certain areas, management
believes market share will be gained from the combined positive
influences of an expanded market presence, increased brand awareness in
core geographic markets due in part to targeted marketing initiatives,
and the effective execution of CWB's strategic plan focused on further
enhancing existing competitive advantages. Canada's domestic economy is
expected to grow modestly in 2012 despite impacts from ongoing global
economic uncertainties. The Bank's key markets in Western Canada are
generally expected to perform well relative to the rest of Canada.
While strong competition from domestic banks and other financial
services firms is expected to persist, the current overall outlook for
new loans is encouraging. Major risks that could have a material
adverse impact on the Bank's expectations include a global economic
recession spurred by the European debt crisis, a recession in the
United States, or a meaningful slowdown in China's economic growth.
Based on a cautiously optimistic outlook and stronger than expected
first quarter loan growth, CWB is well positioned to meet or exceed its
fiscal 2012 loan growth target of 10%.

Loans in the Bank's broker-sourced residential mortgage business,
Optimum Mortgage (Optimum), increased 6% ($60 million) in the quarter
and 18% ($154 million) over the past twelve months to reach $995
million. Results in the quarter reflected growth in both uninsured
mortgages and higher ratio insured mortgages. Uninsured mortgages
continue to be secured via conventional residential first mortgages
carrying a weighted average loan-to-value ratio at initiation of
approximately 70%, and represented approximately 61% of Optimum's total
portfolio at quarter end. CWB remains committed to further developing
this mortgage business as it continues to produce solid returns while
maintaining an acceptable risk profile. The possible benefits of using
securitization or whole loan sales as additional alternatives for
cost-effective funding are also being evaluated. The level of new
lending opportunities in this business could moderate going forward
reflecting increased competitive pressure and overall slower growth in
demand for residential mortgages in Canada.

Under IFRS, the Bank's securitized assets are reported on-balance sheet
as part of total loans. The gross amount of securitized loans at
January 31, 2012 totaled $150 million, compared to $91 million last
quarter and $170 million one year ago.

Deposits

Total deposits at quarter end were $12,961 million, up 5% ($566 million)
from the previous quarter and 21% ($2,280 million) over the past year.
Total branch deposits represented 57% of total deposits at January 31,
2012, compared to 58% in the previous quarter and 63% one year earlier.
Demand and notice deposits were 32% of total deposits, unchanged from
the previous quarter and down from 35% a year earlier. Other deposits
are mainly comprised of retail term deposits raised through the Bank's
deposit broker network and $650 million of fixed term deposits raised
through debt capital markets.

Total branch deposits, including trust services deposits, of $7,379
million increased 2% ($168 million) in the quarter and 9% ($618
million) over the past twelve months. The demand and notice component
within branch deposits, which includes lower cost deposits, was up 5%
($212 million) from last quarter and 14% ($508 million) compared to the
same time last year to reach $4,203 million. Reflecting CWB's business
banking focus, a material portion of total branch deposits are
attributed to larger commercial balances that are subject to greater
fluctuation compared to smaller personal deposits. A strategic focus on
increasing branch-raised deposits will continue in 2012, with emphasis
on the demand and notice component, which is often lower cost and
provides associated transactional fee income. CWB's expanded market
presence, which includes the opening of three new full-service branches
since September 2010, also supports objectives to generate
branch-raised deposits.

Management remains committed to further enhance and diversify all
funding sources to support ongoing growth while maintaining acceptable
net interest margins. The Bank's deposit broker network remains a
valued source for raising insured fixed term retail deposits and has
proven to be an extremely effective and efficient way to access funding
and liquidity over a wide geographic base. Selectively utilizing the
debt capital markets is also part of the Bank's strategy to further
diversify the funding base over time. Provided costs remain
satisfactory, management plans to continue utilizing securitization
channels for a portion of its equipment leasing funding requirements in
2012.

Other Assets and Other Liabilities

Other assets at January 31, 2012 totaled $310 million, compared to $318
million last quarter and $309 million one year ago. Other liabilities
at quarter end were $436 million, compared to $458 million the previous
quarter and $413 million last year.

Off-Balance Sheet

Off-balance sheet items include assets under administration and assets
under management. Total assets under administration, which are
comprised of trust assets under administration and third-party leases
under service agreements totaled $6,912 million at January 31, 2012,
compared to $9,370 million last quarter and $9,013 million one year
ago. The significant reduction in assets under administration reflects
a reduced level of leases under servicing agreements resulting from the
termination of a lease servicing contract. Assets under management were
$844 million at quarter end, compared to $816 million last quarter and
$804 million one year ago.

Other off-balance sheet items are comprised of standard industry credit
instruments (guarantees, standby letters of credit and commitments to
extend credit). CWB does not utilize, nor does it have exposure to,
collateralized debt obligations or credit default swaps. For additional
information regarding other off-balance sheet items refer to Notes 12
and 21 of the audited consolidated financial statements on pages 97 and
106, respectively, in the Bank's 2011 Annual Report.

Capital Management

At January 31, 2012, CWB's Basel II total capital adequacy ratio, which
measures regulatory capital as a percentage of risk-weighted assets,
was 14.6%, compared to 15.4% last quarter and 16.5% one year ago. The
Tier 1 ratio was 10.2% at January 31, 2012, down from 11.1% last
quarter and 11.6% a year earlier. Current minimums for the total and
Tier 1 capital adequacy ratios of Canadian banks as set by the Office
of the Superintendent of Financial Institutions Canada (OSFI) are 10%
and 7%, respectively.

Compared to one year ago, the Bank's Tier 1 regulatory capital increased
with the retention of earnings, net of common and preferred share
dividends, and the issuance of 5.4 million additional CWB common shares
at $14 per share upon the exercise of warrants (refer to the audited
consolidated financial statements and MD&A for the year ended October
31, 2011 for further details), partially offset by total costs for the
purchase of warrants for cancellation. The decrease in Tier 1 capital
from October 31, 2011 reflects the full transition impact of IFRS and
the expiration of a Basel II transition provision that permitted the
capital deduction related to CWB's insurance subsidiary ($83,500 at
January 31, 2012; $80,942 at October 31, 2011) to be deducted from Tier
2 capital. Beginning in the first quarter of 2012, the deduction for
the insurance subsidiary is recorded 50% against Tier 1 capital and 50%
against Tier 2 capital. The full transition to IFRS reduced Tier 1
capital by $50 million compared to the prior quarter (an impact of
approximately 40 basis points on the January 31, 2012 Tier 1 and total
ratios). The 2011 capital structure and regulatory ratios reflect the
returns filed and have not been restated to IFRS. Further details
regarding changes in CWB's regulatory capital and capital adequacy
ratios compared to prior periods are included in the following table:

(unaudited) ($ millions)				As at January 31 2012			As at October 31 2011			As at January 31 2011			Change from January 31 2011
Regulatory Capital
****	Tier 1 Capital before deductions		$	1,388		$	1,395		$	1,297		$	91
	Less:	Goodwill		(46)			(38)			(38)			(8)
		Investment in insurance subsidiary		(41)			-			-			(41)
		Securitization		(11)			(7)			(9)			(2)
Tier 1 Capital				1,290			1,350			1,250			40
	Tier 2 Capital before deductions			618			607			618			-
	Less:	Investment in insurance subsidiary		(42)			(81)			(71)			29
		Securitization		(11)			(6)			(9)			(2)
	Total Tier 2 Capital			565			520			538			27
Total Regulatory Capital			$	1,855		$	1,870		$	1,788		$	67
Risk-Weighted Assets			$	12,667		$	12,161		$	10,818		$	1,849
Tier 1 capital adequacy ratio				10.2	%		11.1	%		11.6	%		(140)	bp⁽¹⁾
Total capital adequacy ratio				14.6			15.4			16.5			(190)

⁽¹⁾bp - basis point change.

The Bank's capital ratios are currently well above Basel II target
ranges established through CWB's Internal Capital Adequacy Assessment
Process (ICAAP) and have the Bank well positioned for the remainder of
the year. The ongoing retention of earnings should support capital
requirements associated with the anticipated achievement of the 2012
minimum performance targets. Management continues to evaluate
alternatives to deploy capital for the long-term benefit of CWB
shareholders, which includes the potential for strategic acquisitions.

The Bank applied for and received OSFI approval to redeem $125 million
of subordinated debentures callable on March 22, 2012. Including the
impact of this expected transaction, the estimated pro forma Basel II
total capital adequacy ratio at January 31, 2012 would be reduced by 90
basis points to 13.7%.

Additional strategies are under development to further optimize the
Bank's capital structure. Management is currently in the early stages
of identifying required resources, costs and potential timelines
related to the Bank's possible transition to an Advanced Internal
Rating Based (AIRB) methodology for managing credit risk and
calculating risk-weighted assets. Preliminary analysis confirms a
multi-year timeframe would be required to complete the transition.

Further information relating to the Bank's capital position is provided
in Note 14 of the unaudited interim consolidated financial statements
as well as the audited consolidated financial statements and MD&A for
the year ended October 31, 2011.

Book value per common share at January 31, 2012 was $14.36, compared to
$13.87 last quarter and $13.95 one year ago.

Common shareholders received a quarterly cash dividend of $0.15 per
common share on January 4, 2012. On March 7, 2012, CWB's Board of
Directors declared a cash dividend of $0.15 per common share, payable
on April 5, 2012 to shareholders of record on March 22, 2012. This
quarterly dividend was unchanged from the previous quarter and is 15%
higher than the quarterly dividend declared one year ago. The Board of
Directors also declared a cash dividend of $0.453125 per Series 3
Preferred Share payable on April 30, 2012 to shareholders of record on
April 20, 2012.

Basel III Capital Framework

The Basel Committee on Banking Supervision of the BIS (the Committee)
has published the Basel III rules text supporting more stringent global
standards on capital adequacy and liquidity, and OSFI has confirmed its
intent to implement the Basel III rules for Canadian banks. OSFI also
issued guidance and advisories on its capital implementation plan for
all Canadian financial institutions, including proposed transition
allowances and details about the treatment of non-viability contingent
capital (NVCC).

Significant capital changes most relevant to CWB include:

increased focus on tangible common equity;

all forms of non-common equity, such as conventional subordinated
debentures and preferred shares, must be NVCC. Compliant NVCC
instruments include a clause requiring conversion to common equity in
the event that OSFI deems the institution to be insolvent or a
government has decided to inject "bail out" funding;

innovative Tier 1 instruments, such as CWB's WesTS, will no longer
qualify;

investment in an insurance subsidiary is no longer deducted from capital
except for any amount that exceeds 15% of tangible common equity; and

changes in the risk-weighting or capital treatment for investments in
the regulatory capital of other financial institutions.

OSFI has publicly stated that all Canadian banks must comply with the
Basel III capital standards, including a 250 basis point capital
conservation buffer. Regulatory minimum capital ratios of 7.0% tangible
common equity Tier 1 (CET1), 8.5% Tier 1 and 10.5% total capital are
effective January 1, 2013. The Basel III rules provide for transitional
adjustments whereby certain aspects of the new rules will be phased in
over time. The only available transitional adjustment in the Basel III
capital standards permitted by OSFI for Canadian banks relates to the
10-year phase out of non-qualifying capital instruments. Application of
the proposed 2019 Basel III standards to the Bank's financial position
at January 31, 2012 results in a 7.5% CET1 ratio, 8.2% Tier 1 ratio and
11.9% total capital ratio. The foregoing estimates are based on the
Bank's current capital structure and composition of risk-weighted
assets, and will change depending on strategic initiatives, the
composition of regulatory capital, the Bank's financial performance in
the future and modifications, if any, to the standards and available
transitional adjustments by the regulatory authorities. CWB expects to
meet or exceed the stated Basel III capital requirements in advance of
the transition date. Management will maintain its practice of prudent
capital planning, which includes a comprehensive ICAAP.

Changes in Accounting Policies

International Financial Reporting Standards (IFRS)

The Canadian Institute of Chartered Accountants has transitioned
Canadian generally accepted accounting principles (GAAP) for publicly
accountable entities to IFRS. The transition is applicable to interim
and annual financial statements effective for fiscal years beginning on
or after January 1, 2011, including comparatives for the prior year. As
a result, CWB's consolidated financial statements for the 2012 fiscal
year are prepared in accordance with IFRS, including comparative
information for 2011. CWB's financial results for the quarter ending
January 31, 2012 are the first quarterly IFRS financial statements.

Information regarding CWB's transition plan, which is now substantially
complete, can be found in the Future Changes in Accounting Policies
section of the MD&A within CWB's 2011 Annual Report. Additional
quantitative information related to the transition to IFRS can be found
in Note 15 of the interim financial statements for the period ended
January 31, 2012. The adoption of IFRS did not have a significant
impact on CWB's disclosure controls and procedures, information
technology or business activities.

Significant accounting policy differences for the Bank on initial
transition to IFRS and any elections made are described below.

(1) Business Combinations - Under IFRS, contingent consideration related to a business
combination is accounted for as a financial liability and fair valued
at the time of the acquisition. An adjustment of the liability to
current fair value is recorded through net income every period
thereafter until settlement. Under Canadian GAAP, when the amount of
contingent consideration or the outcome of the contingency cannot be
estimated with reasonable certainty, the liability is not recognized
until the contingency is resolved and consideration is issued or
becomes issuable; at such time, the consideration is recorded as an
adjustment of goodwill.

The Bank has applied IFRS 3 - Business Combinations retrospectively to the acquisition of National Leasing Group Inc.
(National Leasing) (described in Note 34 to the 2011 annual
consolidated financial statements on page 119 of the 2011 Annual
Report). Under IFRS 1 - First Time Adoption of IFRS, the estimated fair value of the associated contingent consideration at
the acquisition date of February 1, 2010 was recorded at the
acquisition date.

The retrospective restatement increased goodwill recorded on the
consolidated balance sheet at November 1, 2010 by $8 million. The revaluation of the contingent consideration since acquisition
decreased retained earnings at November 1, 2010 by $10 million. The net
effect of revaluing the obligation in fiscal 2011 resulted in a $12
million reduction in net income.

The change in fair value of the contingent consideration reflects the
Bank's best estimate of when the contingent consideration will be
settled in accordance with the terms of the purchase agreement, and
estimates of future earnings of National Leasing. Increases in the
estimated fair value of the contingent consideration result in a
non-tax deductible charge to earnings based on forecasted earnings
growth attributable to National Leasing, changes in management's
estimates of the expected settlement date of the contingent
consideration and a notional interest charge. Future charges to
quarterly earnings attributable to the fair value estimate of the
contingent consideration are expected to be lower compared to amounts
reported in 2011, as prior year charges included a larger adjustment to
forecasted net income than is expected going forward.

(2) Derecognition of Securitized Financial Assets - CWB's securitized leases are reported as loans on the IFRS balance
sheet which resulted in an increase in both loans and debt. The
corresponding impact on net income in fiscal 2011 was insignificant.
The IFRS transition resulted in the following increase in total loans
at the respective balance sheet dates:


($ millions)	Increase in Total Loans
November 1, 2010	$196
January 31, 2011	167
April 30, 2011	140
July 31, 2011	114
October 31, 2011	90

The earnings effect of securitization as reported under IFRS resulted in
a $2 million decrease in retained earnings as at November 1, 2010. The
change reflects the elimination of cumulative securitization gains and
losses realized under Canadian GAAP, less recognition of interest
income and expense under IFRS. The net effect on 2011 consolidated net
income was an increase of $1 million.

The future earnings impact from securitization transactions completed
prior to October 31, 2011 is expected to be insignificant. Leases
securitized in the future will remain on the consolidated balance sheet
reported as loans.

(3) Consolidation - Under IFRS, a special purpose entity is consolidated if it is deemed
to be controlled by the reporting entity, as determined under specific
criteria. Canadian Western Bank Capital Trust is consolidated under
IFRS, which resulted in a $105 million decrease in deposits and the
presentation of the CWB Capital Trust Capital Securities Series 1
(WesTS) as equity attributed to non-controlling interests.
Distributions on the WesTS that were effectively reported as deposit
interest expense are now presented as an equity dividend within IFRS
"net income attributable to non-controlling interests." For more
information about this special purpose entity, refer to Note 15 to the
consolidated financial statements beginning on page 100 of the 2011
Annual Report.

The net effect on 2011 consolidated "net income" effectively resulted in
an increase of $7 million as the deposit interest expense under
Canadian GAAP is treated as an equity dividend payment under IFRS.
"Net income attributable to shareholders of the Bank" is reported net
of the non-controlling interest and was not affected in 2011 by this
accounting policy difference.

(4) Impairment of Available-for-Sale Securities - Under both Canadian GAAP and IFRS, available-for-sale securities are
reported on the balance sheet at fair value with changes in fair value
generally reported in other comprehensive income. An unrealized loss is
recognized in net income when a security is considered impaired; a
subsequent recovery in the value of an equity security is not reversed
through net income until the security is either sold or redeemed. Under
Canadian GAAP, a significant or prolonged decline in the fair value of
an investment below its cost is assessed in the context of whether it
is considered an "other than temporary impairment" (OTTI). Under IFRS,
the concept of OTTI does not exist and either a significant or
prolonged decline in fair value is considered objective evidence of
impairment. The differences between Canadian GAAP and IFRS will
generally result in earlier recognition of impairment losses through
net income under IFRS.

There was no change in shareholders' equity and a $2 million reduction
in 2011 net income as a result of the transition. The impact of the
IFRS definition of significant or prolonged impairment on the Bank's
future earnings is not determinable as it depends on future interest
rate environments, market conditions, investment strategies and the
Bank's asset/liability position.

(5) Other Reclassifications - Certain other financial statement reclassifications have been made on
the transition to IFRS. An example includes the presentation of the
non-controlling interest in Adroit Investment Management Ltd. which has
been reclassified from other liabilities under Canadian GAAP to
non-controlling interests (presented in equity) under IFRS.

In addition to the IFRS transition adjustments previously described, the
recognition of certain credit related fees was also amended. Certain
credit related fees, previously recognized in other income, are now
reflected as part of the loan yield and amortized to net interest
income over the expected life of the loan. Because total loans are
reported net of deferred loan fees, this change resulted in a decrease
in total loans of $18 million at both November 1, 2010 and October 31,
2011, and a reduction in retained earnings of $13 million at November
1, 2010. While the change had no impact on 2011 net income,
approximately $15 million was reclassified from other income to net
interest income resulting in a 17 basis point increase in the fiscal
2011 IFRS net interest margin (teb) compared to Canadian GAAP. The
impact on the income statement in future periods is expected to be
relatively consistent with 2011.

IFRS Regulatory Capital Implications

As at January 31, 2012, the Basel II Tier 1 and total regulatory capital
ratios declined approximately 40 basis points as a result of the
transition to IFRS. After adjusting for the effect of the IFRS
transition, these ratios remain well above both regulatory minimums and
target capital thresholds determined through the Bank's ICAAP.

Under IFRS, the Bank's securitized leases are accounted for as secured
borrowings. Recognition of securitized assets on the consolidated
balance sheet increases the regulatory assets to capital multiple. As
at January 31, 2012, the assets to capital multiple increased slightly
from 8.1 to 8.3 as a result of the IFRS transition adjustment and still
remains well within the regulatory limit.

Future Accounting Changes

A number of standards and amendments have been issued by the
International Accounting Standards Board (IASB), and the following
changes may have an impact on the Bank's future financial statements.
CWB is currently reviewing these standards to determine the impact on
the financial statements.

IFRS 9 - Financial Instruments

The IASB deferred the mandatory effective date of IFRS 9 to annual
periods beginning on or after January 1, 2015. The new standard
specifies that financial assets be classified into one of two
categories on initial recognition: financial assets measured at
amortized cost or financial assets measured at fair value. Gains or
losses on remeasurement of financial assets measured at fair value will
generally be recognized in profit or loss.

IFRS 10 - Consolidated Financial Statements and IFRS 12 - Disclosure of Interests in Other Entities

The IASB has issued IFRS 10 and 12, which establish principles for the
presentation and preparation of consolidated financial statements when
an entity controls one or more other entities, and new disclosure
requirements for all forms of interests in other entities. IFRS 10 and
12 are effective for annual periods beginning on or after January 1,
2013.

IFRS 13 - Fair Value Measurement

The IASB has issued new guidance on fair value measurement and
disclosure requirements for IFRS. The amendments are effective for
annual periods beginning on or after January 1, 2013.

CWB continues to monitor IASB ongoing activity and proposed changes to
IFRS. Several accounting standards that are in the process of being
amended by the IASB (i.e. loan impairment, leases and insurance) may
have a significant impact on the Bank's future consolidated financial
statements.

Controls and Procedures

There were no changes in the Bank's internal controls over financial
reporting that occurred during the quarter ended January 31, 2012 that
have materially affected, or are reasonably likely to materially
affect, the Bank's internal controls over financial reporting.

Prior to its release, this quarterly report to shareholders was reviewed
by the Audit Committee and, on the Audit Committee's recommendation,
approved by the Board of Directors of Canadian Western Bank.

Updated Share Information

As at March 2, 2012, there were 75,694,379 common shares outstanding.
Also outstanding were employee stock options, which are or will be
exercisable for up to 3,915,337 common shares for maximum proceeds of
$88 million.

Normal Course Issuer Bid

CWB received approval from the Toronto Stock Exchange for a Normal
Course Issuer Bid (NCIB) to purchase, for cancellation, up to 2,261,434
of its common shares. The NCIB commenced November 2, 2011 and will end
no later than November 1, 2012. To date, no common shares have been
purchased or cancelled under the NCIB. Security holders may contact the
Bank to obtain, without charge, a copy of the notice filed with the
TSX. Additionally, a copy of the NCIB news release is available on the
Bank's website and on SEDAR at www.sedar.com.

Dividend Reinvestment Plan

CWB common shares (TSX: CWB) and preferred shares (TSX: CWB.PR.A) are
deemed eligible to participate in the Bank's dividend reinvestment plan
(the Plan). The Plan provides holders of eligible shares the
opportunity to direct cash dividends toward the purchase of CWB common
shares. Further details for the Plan are available on the Bank's
website at www.cwbankgroup.com/investor_relations/drip. At the current time, for the purposes of the
Plan, the Bank has elected to issue common shares from treasury at a 2%
discount from the average market price (as defined in the Plan).

Summary of Quarterly Financial Information

	IFRS										Canadian GAAP
		2012		2011								2010
		Q1		Q4		Q3		Q2		Q1		Q4		Q3		Q2
Total revenues (teb)	$	126,300	$	119,673	$	122,753	$	119,766	$	121,363	$	111,570	$	111,045	$	110,972
Total revenues		123,680		116,540		119,956		117,381		118,619		108,391		108,263		108,310
Net income		47,051		41,474		44,393		42,440		43,414		39,107		46,595		37,884
Net income available to common shareholders		41,478		35,921		38,824		36,941		37,852		35,305		42,793		34,082
Earnings per common share
Basic		0.55		0.48		0.52		0.52		0.56		0.53		0.64		0.52
Diluted		0.54		0.47		0.50		0.48		0.50		0.48		0.59		0.47
Adjusted cash		0.57		0.53		0.54		0.55		0.55		0.49		0.60		0.48
Total assets ($ millions)		15,484		14,849		14,097		13,726		13,099		12,702		12,110		12,004

The financial results for each of the last eight quarters are summarized
above. Note that 2010 results are presented under Canadian GAAP and
have not been restated to IFRS. In general, CWB's performance reflects
a relatively consistent trend although the second quarter contains
three fewer revenue earning days, or two fewer days in a leap year.

The Bank's quarterly financial results are subject to some fluctuation
due to its exposure to property and casualty insurance. Insurance
operations, which are primarily reflected in other income, are subject
to seasonal weather conditions, cyclical patterns of the industry and
natural catastrophes. Mandatory participation in the Alberta auto risk
sharing pools can also result in unpredictable quarterly fluctuations.

Quarterly results can also fluctuate from the recognition of periodic
income tax items, as was the case in the third quarter of 2010 when an
income tax recovery from certain prior period transactions increased
net income available to common shareholders by approximately $7.5
million.

For additional details on variations between the prior quarters, refer
to the summary of quarterly results section of the Bank's MD&A for the
year ended October 31, 2011 and the individual quarterly reports to
shareholders which are available on SEDAR at www.sedar.com and on CWB's website at www.cwbankgroup.com.

Fiscal 2012 Minimum Targets and Outlook

The minimum performance targets established for the 2012 fiscal year,
calculated under IFRS, together with CWB's actual year-to-date
performance are presented in the table below:


	2012 Minimum Target - IFRS	2012 Year-to-date Performance
Net income available to common shareholders growth⁽¹⁾	10%	10%
Total revenue (teb) growth⁽¹⁾	7%	4%
Loan growth⁽²⁾	10%	15%
Provision for credit losses as a percentage of average loans⁽³⁾	0.20% - 0.25%	0.20%
Efficiency ratio (teb)⁽⁴⁾	46%	43.7%
Return on common shareholders' equity⁽⁵⁾	15%	15.5%
Return on assets⁽⁶⁾	1.05%	1.07%

	⁽¹⁾	^{Year-to-date performance for earnings and revenue growth is the current year results over the same period in the prior year.}
	⁽²⁾	^{Loan growth is the increase over the past twelve months.}
	⁽³⁾	^{Year-to-date provision for credit losses, annualized, divided by average total loans.}
	⁽⁴⁾	^{Efficiency ratio (teb) calculated as non-interest expenses divided by total revenues (teb), excluding the non-tax deductible change in fair value of contingent consideration.}
	⁽⁵⁾	^{Return on common shareholders' equity calculated as annualized net income available to common shareholders divided by average common shareholders' equity.}
	⁽⁶⁾	^{Return on assets calculated as annualized net income available to common shareholders divided by average total assets.}

Strong first quarter results have CWB well positioned in relation to its
fiscal 2012 performance targets for loan growth, profitability,
efficiency and overall credit quality. Higher than expected first
quarter loan growth reflects ongoing strong business activity in each
of the Bank's lending sectors and all key geographic markets. Economic
fundamentals in Western Canada are expected to remain favourable
relative to the rest of Canada, although management continues to
closely monitor global economic developments, including potential
adverse impacts from the ongoing European debt crisis. The volume in
the new loan pipeline is encouraging and supports management's ongoing
confidence in strategies to build market share while maintaining a
focus on loans that offer a fair and profitable return on investment.
While the combined impact of the strategy to maintain higher than
normal liquidity, the very low interest rate environment and other
external factors, including increased competition, has had a material
impact on net interest margin, recent downward pressure is expected to
moderate. This occurrence, combined with strong lending activity,
should have a positive influence on total revenue growth moving
forward. Solid performance is expected within each company of the CWB
Group and the ongoing growth of these businesses should continue to
augment earnings and further diversify operations. Despite ongoing
caution related to global economic uncertainties, the outlook for 2012
and beyond remains positive.

This management's discussion and analysis is dated March 7, 2012.

Taxable Equivalent Basis (teb)

Most banks analyze revenue on a taxable equivalent basis to permit
uniform measurement and comparison of net interest income. Net interest
income (as presented in the consolidated statement of income) includes
tax-exempt income on certain securities. Since this income is not
taxable, the rate of interest or dividends received is significantly
lower than would apply to a loan or security of the same amount. The
adjustment to taxable equivalent basis increases interest income and
the provision for income taxes to what they would have been had the
tax-exempt securities been taxed at the statutory rate. The taxable
equivalent basis does not have a standardized meaning prescribed by
IFRS and, therefore, may not be comparable to similar measures
presented by other banks. Total revenues, net interest income and
income taxes are discussed on a taxable equivalent basis throughout
this quarterly report to shareholders.

Non-GAAP Measures

Taxable equivalent basis, adjusted cash earnings per common share,
return on common shareholders' equity, return on assets, efficiency
ratio, net interest margin, tangible common equity to risk-weighted
assets, Tier 1 and total capital adequacy ratios, average balances,
claims loss ratio, expense ratio and combined ratio do not have
standardized meanings prescribed by IFRS and therefore may not be
comparable to similar measures presented by other financial
institutions. The non-GAAP measures used in this MD&A are calculated as
follows:

taxable equivalent basis - described above;

adjusted cash earnings per common share - diluted earnings per common
share excluding the after-tax amortization of acquisition-related
intangible assets and the non-tax deductible change in fair value of
contingent consideration. These exclusions represent non-cash charges
mainly related to the acquisition of National Leasing Group Inc. and
are not considered to be indicative of ongoing business performance;

return on common shareholders' equity - annualized net income
attributable to shareholders of the Bank after preferred share
dividends divided by average common shareholders' equity;

return on assets - annualized net income attributable to shareholders of
the Bank after preferred share dividends divided by average total
assets;

efficiency ratio - non-interest expenses divided by total revenues
excluding the non-tax deductible change in fair value of contingent
consideration;

net interest margin - net interest income divided by average total
assets;

tangible common equity to risk-weighted assets - shareholders' equity
less subsidiary goodwill divided by risk-weighted assets, calculated in
accordance with guidelines issued by the Office of the Superintendent
of Financial Institutions Canada (OSFI);

Tier 1 and total capital adequacy ratios - in accordance with guidelines
issued by OSFI;

Basel III common equity Tier 1, Tier 1 and total capital ratios - in
accordance with CWB's interpretation of the Basel III capital
requirements and OSFI proposed guidance;

average balances - average daily balances;

claims loss ratio - net insurance claims and adjustment expenses as a
percentage of net earned premiums; and

combined ratio - sum of the claims loss ratio and the expense ratio. The
expense ratio is defined as policy acquisition costs and non-interest
expenses net of commissions and processing fees as a percentage of net
earned premiums.

Forward-looking Statements

From time to time, Canadian Western Bank (the Bank) makes written and
verbal forward-looking statements. Statements of this type are included
in the Annual Report and reports to shareholders and may be included in
filings with Canadian securities regulators or in other communications
such as press releases and corporate presentations. Forward-looking
statements include, but are not limited to, statements about the Bank's
objectives and strategies, targeted and expected financial results and
the outlook for the Bank's businesses or for the Canadian economy.
Forward-looking statements are typically identified by the words
"believe", "expect", "anticipate", "intend", "estimate", "may
increase", "may impact" and other similar expressions, or future or
conditional verbs such as "will", "should", "would" and "could."

By their very nature, forward-looking statements involve numerous
assumptions. A variety of factors, many of which are beyond the Bank's
control, may cause actual results to differ materially from the
expectations expressed in the forward-looking statements. These factors
include, but are not limited to, general business and economic
conditions in Canada including the volatility and lack of liquidity in
financial markets, fluctuations in interest rates and currency values,
changes in monetary policy, changes in economic and political
conditions, regulatory and legal developments, the level of competition
in the Bank's markets, the occurrence of weather-related and other
natural catastrophes, changes in accounting standards and policies, the
accuracy of and completeness of information the Bank receives about
customers and counterparties, the ability to attract and retain key
personnel, the ability to complete and integrate acquisitions, reliance
on third parties to provide components of the Bank's business
infrastructure, changes in tax laws, technological developments,
unexpected changes in consumer spending and saving habits, timely
development and introduction of new products, and management's ability
to anticipate and manage the risks associated with these factors. It is
important to note that the preceding list is not exhaustive of possible
factors.

These and other factors should be considered carefully and readers are
cautioned not to place undue reliance on these forward-looking
statements as a number of important factors could cause the Bank's
actual results to differ materially from the expectations expressed in
such forward looking statements. Unless required by securities law, the
Bank does not undertake to update any forward-looking statement,
whether written or verbal, that may be made from time to time by it or
on its behalf.

Assumptions about the performance of the Canadian economy in 2012 and
how it will affect CWB's businesses are material factors the Bank
considers when setting its objectives. In setting minimum performance
targets for fiscal 2012, management's assumptions included: modest
economic growth in Canada aided by positive relative performance in the
four western provinces; relatively stable energy and other commodity
prices; sound credit quality with actual losses remaining within the
Bank's historical range of acceptable levels; and, a lower net interest
margin attributed to expectations for a prolonged period of very low
interest rates due to uncertainties about the strength of global
economic recovery and potential adverse effects from the European debt
crisis. Management's assumptions at the end of the first quarter
remained relatively unchanged compared to those at the 2011 fiscal year
end. Major risks that would have a material adverse impact on the
Bank's economic expectations and forecasts include a global economic
recession spurred by the European debt crisis, a recession in the
United States, or a meaningful slowdown in China's economic growth.

Consolidated Balance Sheets


(unaudited)				As at		As at		As at		As at	Change from
($ thousands)				January 31 2012		October 31 2011		January 31 2011		November 1 2010	January 31 2011
Assets
Cash Resources
	Cash and non-interest bearing deposits with financial institutions		$	44,745	$	73,318	$	59,036	$	8,965	(24)	%
	Interest bearing deposits with regulated financial institutions	(Note 4)		182,427		233,964		219,953		168,998	(17)
	Cheques and other items in transit			1,792		5,053		941		9,981	90
				228,964		312,335		279,930		187,944	(18)
Securities		(Note 4)
	Issued or guaranteed by Canada			680,933		644,356		478,771		564,694	42
	Issued or guaranteed by a province or municipality			415,166		380,031		187,816		88,478	121
	Other securities			983,692		901,317		807,088		857,015	22
				2,079,791		1,925,704		1,473,675		1,510,187	41
Securities Purchased Under Resale Agreements				119,999		-		-		177,954	nm
Loans		(Notes 5 and 7)
	Residential mortgages			3,082,924		3,008,545		2,667,045		2,479,957	16
	Other loans			9,736,523		9,356,717		8,446,469		8,276,263	15
				12,819,447		12,365,262		11,113,514		10,756,220	15
	Allowance for credit losses	(Note 6)		(74,556)		(71,980)		(77,593)		(81,523)	(4)
				12,744,891		12,293,282		11,035,921		10,674,697	15
Other
	Property and equipment			71,439		72,674		66,830		65,978	7
	Goodwill			45,691		45,691		45,691		45,562	-
	Other intangible assets			36,131		37,420		42,027		43,420	(14)
	Insurance related			56,058		56,734		57,853		59,652	(3)
	Derivative related	(Note 8)		-		-		130		134	nm
	Other assets			101,084		105,301		96,640		116,200	5
				310,403		317,820		309,171		330,946	-
Total Assets			$	15,484,048	$	14,849,141	$	13,098,697	$	12,881,728	18	%

Liabilities and Shareholders' Equity
Deposits
	Payable on demand		$	592,566	$	583,267	$	584,728	$	530,608	1	%
	Payable after notice			3,610,670		3,407,590		3,110,008		2,999,599	16
	Payable on a fixed date			8,757,693		8,403,832		6,986,605		7,177,560	25
				12,960,929		12,394,689		10,681,341		10,707,767	21
Other
	Cheques and other items in transit			32,874		45,986		47,423		39,628	(31)
	Insurance related			144,468		149,130		143,010		149,396	1
	Derivative related	(Note 8)		539		436		812		992	(34)
	Other liabilities			258,330		262,185		221,891		239,474	16
				436,211		457,737		413,136		429,490	6
Debt
	Debt securities			140,049		89,877		171,812		202,006	(18)
	Subordinated debentures			545,000		545,000		545,000		315,000	-
				685,049		634,877		716,812		517,006	(4)
Equity
	Preferred shares	(Note 9)		209,750		209,750		209,750		209,750	-
	Common shares	(Note 9)		412,120		408,282		323,608		279,620	27
	Retained earnings			639,004		608,848		607,932		586,933	5
	Share-based payment reserve			22,079		21,884		21,089		21,291	5
	Other reserves			13,681		7,849		19,790		24,692	(31)
Total Shareholders' Equity				1,296,634		1,256,613		1,182,169		1,122,286	10
	Non-controlling interests			105,225		105,225		105,239		105,179	-
Total Equity				1,401,859		1,361,838		1,287,408		1,227,465	9
Total Liabilities and Shareholders' Equity			$	15,484,048	$	14,849,141	$	13,098,697	$	12,881,728	18	%

nm - not meaningful.
The accompanying notes are an integral part of the interim consolidated financial statements.

Consolidated Statements of Income

(unaudited)				For the three months ended
($ thousands, except per share amounts)				January 31 2012		October 31 2011		January 31 2011	Change from January 31 2011
Interest Income
	Loans		$	166,300	$	162,945	$	152,682	9	%
	Securities			11,821		12,011		9,962	19
	Deposits with regulated financial institutions			1,025		808		1,379	(26)
				179,146		175,764		164,023	9
Interest Expense
	Deposits			66,255		64,265		57,143	16
	Debt			8,002		8,448		8,407	(5)
				74,257		72,713		65,550	13
Net Interest Income				104,889		103,051		98,473	7
Provision for Credit Losses		(Note 6)		6,429		5,183		6,250	3
Net Interest Income after Provision for Credit Losses				98,460		97,868		92,223	7
Other Income
	Credit related			4,967		4,638		4,526	10
	Insurance, net	(Note 3)		4,402		4,943		4,590	(4)
	Trust and wealth management services			4,769		4,336		4,533	5
	Retail services			2,356		2,289		2,462	(4)
	Gains (losses) on securities, net			1,938		(3,103)		4,237	(54)
	Foreign exchange gains			669		930		836	(20)
	Contingent consideration fair value change			(1,200)		(3,539)		(2,516)	52
Other				890		2,995		1,478	(40)
				18,791		13,489		20,146	(7)
Net Interest and Other Income				117,251		111,357		112,369	4
Non-Interest Expenses
	Salaries and employee benefits			36,407		35,183		35,641	2
	Premises and equipment			9,433		9,383		8,847	7
	Other expenses			9,702		11,419		9,609	1
	Provincial capital taxes			125		125		1,031	(88)
				55,667		56,110		55,128	1
Net Income before Income Taxes				61,584		55,247		57,241	8
Income Taxes				14,533		13,773		13,827	5
Net Income			$	47,051	$	41,474	$	43,414	8	%
Net Income Attributable to Non-Controlling Interests				1,771		1,751		1,760	1
Net Income Attributable to Shareholders of the Bank			$	45,280	$	39,723	$	41,654	9
Preferred share dividends		(Note 9)		3,802		3,802		3,802	-
Net Income Available to CommonShareholders			$	41,478	$	35,921	$	37,852	10
Average number of common shares (in thousands)				75,528		75,376		68,151	11
Average number of diluted common shares (in thousands)				76,288		76,959		75,032	2
Earnings Per Common Share
	Basic		$	0.55	$	0.48	$	0.56	(2)	%
	Diluted			0.54		0.47		0.50	8

The accompanying notes are an integral part of the interim consolidated
financial statements.

Consolidated Statements of Comprehensive Income

	For the three months ended
(unaudited) ($ thousands)		January 31 2012		January 31 2011
Net Income	$	47,051	$	43,414
Other Comprehensive Income (Loss), net of tax
Available-for-sale securities:
Gains (losses) from change in fair value⁽¹⁾		7,355		(1,852)
Reclassification to net income⁽²⁾		(1,424)		(3,050)
		5,931		(4,902)
Derivatives designated as cash flow hedges:
Losses from change in fair value⁽³⁾		(395)		-
Reclassification to net income⁽⁴⁾		296		-
		(99)		-
		5,832		(4,902)
Comprehensive Income for the Period	$	52,883	$	38,512

Comprehensive income for the period attributable to:
Shareholders of the Bank	$	51,112	$	36,752
Non-controlling interests		1,771		1,760
Comprehensive Income for the Period	$	52,883	$	38,512

⁽¹⁾								Net of income tax expense of $2,610 (2011 - $721 tax recovery).
⁽²⁾								Net of income tax expense of $514 (2011 - $1,187).
⁽³⁾								Net of income tax recovery of $138 (2011 - nil).
⁽⁴⁾								Net of income tax recovery of $104 (2011 - nil)

The accompanying notes are an integral part of the interim consolidated
financial statements.

Consolidated Statements of Changes in Shareholders' Equity


				For the three months ended
(unaudited)
($ thousands)					January 31 2012		January 31 2011
Retained Earnings
	Balance at beginning of period			$	608,848	$	586,933
	Net income attributable to shareholders of the Bank				45,280		41,654
	Dividends	- Preferred shares			(3,802)		(3,802)
		- Common shares			(11,322)		(9,050)
	Warrants purchased and cancelled				-		(7,803)
Balance at end of period					639,004		607,932
Other Reserves
Balance at beginning of period					7,849		24,692
	Changes in available-for-sale securities				5,931		(4,902)
	Changes in derivatives designated as cash flow hedges				(99)		-
Balance at end of period					13,681		19,790
Preferred Shares			(Note 9)
Balance at beginning and end of period					209,750		209,750
Common Shares			(Note 9)
Balance at beginning of period					408,282		279,620
	Issued under dividend reinvestment plan				2,492		574
	Transferred from share-based payment reserve on the exercise or exchange of options				967		1,491
	Issued on exercise of options				379		1,291
	Issued on exercise of warrants				-		40,632
Balance at end of period					412,120		323,608
Share-based Payment Reserve
Balance at beginning of period					21,884		21,291
	Amortization of fair value of options				1,162		1,289
	Transferred to common shares on the exercise or exchange of options				(967)		(1,491)
Balance at end of period					22,079		21,089
Total Shareholders' Equity					1,296,634		1,182,169
Non-Controlling Interests
Balance at beginning of period					105,225		105,179
	Net income attributable to non-controlling interests				1,771		1,760
	Dividends to non-controlling interests				(1,771)		(1,700)
Balance at end of period					105,225		105,239
Total Equity				$	1,401,859	$	1,287,408

The accompanying notes form an integral part of these consolidated financial statements.

Consolidated Statements of Cash Flow

For the three months ended

(unaudited)

($ thousands)

January 31

2012

January 31

2011

Cash Flows from Operating Activities

Net income

47,051

43,414

Adjustments to determine net cash flows:

Provision for credit losses

6,429

6,250

Depreciation and amortization

4,941

4,444

Current income taxes receivable and payable

509

2,603

Amortization of fair value of employee stock options

1,162

1,289

Accrued interest receivable and payable, net

(931)

(7,686)

Deferred income taxes, net

(7,736)

Gain on securities, net

(1,938)

(4,237)

Other items, net

(9,957)

16,474

47,303

54,815

Cash Flows from Financing Activities

Deposits, net

566,240

(26,426)

Debt securities, net

50,171

(30,194)

Common shares issued

(Note 9)

2,871

42,497

Dividends

(15,124)

(12,852)

Dividends to non-controlling interests

(1,771)

(1,700)

Debentures issued

300,000

Debentures redeemed

(70,000)

Warrants purchased and cancelled

(7,803)

602,387

193,522

Cash Flows from Investing Activities

Interest bearing deposits with regulated financial institutions, net

51,655

(51,567)

Securities, purchased

(1,018,273)

(1,105,342)

Securities, sale proceeds

298,641

462,158

Securities, matured

579,603

673,075

Securities purchased under resale agreements, net

(119,999)

177,954

Loans, net

(458,038)

(367,474)

Property and equipment

(2,001)

(3,904)

(668,412)

(215,100)

Change in Cash and Cash Equivalents

(18,722)

33,237

Cash and Cash Equivalents at Beginning of Year

32,385

(20,683)

Cash and Cash Equivalents at End of Year *

13,663

12,554

* Represented by:

Cash and non-interest bearing deposits with financial institutions

44,745

59,036

Cheques and other items in transit (included in Cash Resources)

1,792

941

Cheques and other items in transit (included in Other Liabilities)

(32,874)

(47,423)

Cash and Cash Equivalents at End of Year

13,663

12,554

Supplemental Disclosure of Cash Flow Information

Interest and dividends received

183,805

170,234

Interest paid

75,591

74,922

Income taxes paid

13,926

19,091

The accompanying notes are an integral part of the interim consolidated
financial statements.

Notes to Interim Consolidated Financial Statements

(unaudited)

($ thousands, except per share amounts)

1. Basis of Presentation and Significant Accounting Policies

a)Statement of Compliance

These unaudited condensed consolidated financial statements of Canadian
Western Bank (CWB or the Bank) have been prepared in accordance with
International Financial Reporting Standards (IFRS) 1 - First time Adoption of IFRS and with International Accounting Standard (IAS) 34 - Interim Financial Reporting as issued by the International Accounting Standards Board (IASB). These
are the Bank's first interim consolidated financial statements prepared
in accordance with IFRS. An explanation of how the transition to IFRS
has affected the Bank's consolidated financial statements is provided
in Note 15.

These unaudited interim consolidated financial statements of CWB,
domiciled in Canada, have been prepared in accordance with subsection
308 (4) of the Bank Act and the accounting requirements of the Office
of the Superintendent of Financial Institutions Canada (OSFI).

The consolidated financial statements were authorized for issue by the
Board of Directors on March 7, 2012.

The accounting policies adopted in these consolidated financial
statements are consistent with the accounting policies the Bank expects
to adopt in its IFRS consolidated financial statement for the year
ended October 31, 2012 and are based on IFRS as issued by the IASB
expected to be applicable at that time. Unless otherwise noted, the
notes to the October 31, 2011 audited consolidated financial statements
included in the 2011 annual report reported under Canadian generally
accepted accounting principles (Canadian GAAP) are materially
consistent. The significant accounting policies used in the preparation
of these financial statements are summarized below.

b)Use of Estimates and Assumptions

The preparation of financial statements in conformity with IFRS requires
the Bank to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the disclosure of contingent
assets and liabilities as at the date of the consolidated financial
statements as well as the reported amount of revenues and expenses
during the period. Key areas of estimation where the Bank has made
subjective judgments, often as a result of matters that are inherently
uncertain, include those relating to the allowance for credit losses,
fair value of financial instruments, goodwill and intangible assets,
provision for unpaid claims and adjustment expenses, deferred income
tax assets and liabilities, impairment of available-for-sale securities
and fair value of stock options. Therefore, actual results could differ
from these estimates.

c)Basis of Consolidation

The consolidated financial statements include the assets, liabilities
and results of operations of the Bank and all of its subsidiaries,
after the elimination of intercompany transactions and balances.
Subsidiaries are defined as entities whose operations are controlled by
the Bank and are corporations in which the Bank is the beneficial
owner.

d)Business Combinations

Acquisitions on or after February 1, 2010

Business combinations are accounted for using the acquisition method.
The cost of an acquisition is measured at the fair value of the
consideration, including contingent consideration, given at the
acquisition date. Contingent consideration is considered a financial
instrument, and as such it is remeasured each period thereafter with
the adjustment recorded to other income - "other". Acquisition
related costs are recognized as an expense in the income statement in
the period in which they are incurred. The acquired identifiable
assets, liabilities and contingent liabilities are measured at their
fair values at the date of acquisition. Goodwill is measured as the
excess of the aggregate of the consideration transferred, including any
amount of any non-controlling interest in the acquiree, over the net of
the recognized amounts of the identifiable assets acquired and the
liabilities assumed.

The Bank elects on a transaction-by-transaction basis whether to measure
non-controlling interest at its fair value or at its proportionate
share of the recognized amount of the identifiable net assets, at the
acquisition date.

Acquisitions prior to February 1, 2010

As part of the transition to IFRS, the Bank elected to restate only
those business combinations that occurred on or after February 1, 2010.
See Note 15 for details of the transition impact. In respect of
business combinations prior to February 1, 2010, goodwill represents
the amount recognized under Canadian GAAP. Under Canadian GAAP,
business acquisitions were accounted for using the purchase method.

e)Functional and Foreign Currencies

The consolidated financial statements are presented in Canadian dollars,
which is the Bank's functional currency. Assets and liabilities
denominated in foreign currencies are translated into Canadian dollars
at rates prevailing at the balance sheet date. Revenues and expenses in
foreign currencies are translated at the average exchange rates
prevailing during the period. Realized and unrealized gains and losses
on foreign currency positions are included in other income, except for
unrealized foreign exchange gains and losses on available-for-sale
equity securities that are included in other comprehensive income.

f)Securities

Securities have been designated as available-for-sale, are accounted for
at settlement date and recorded on the consolidated balance sheets at
fair value with changes in fair value generally recorded in other
comprehensive income, net of income taxes. Interest income from
securities, which includes amortization of premiums and discounts, is
recognized using the effective interest method in the consolidated
statements of income. Dividend income is recognized on the ex-dividend
date.

Securities are purchased with the original intention to hold the
instrument to maturity or until market conditions render alternative
investments more attractive. Gains and losses realized on disposal of
securities and adjustments to record any impairment in value are
included in other income.

At each reporting date, the Bank assesses whether there is objective
evidence that securities designated as available-for-sale are
impaired. Objective evidence that a security is impaired can include
significant financial difficulty of the issuer, indications that an
issuer will enter bankruptcy or the disappearance of an active market
for a security. In addition, for an equity security, a significant or
prolonged decline in fair value below amortized cost is objective
evidence of impairment.

Impairment losses on available-for-sale securities are recognized by
reclassifying the cumulative loss recognized in other comprehensive
income to the income statement as "gains (losses) on securities, net".
The reclassified amount is the difference between the amortized cost,
net of any principal repayment and amortization, and the fair value,
less any impairment previously recognized in net income.

If, in a subsequent period, the fair value of an impaired
available-for-sale debt security increases and the increase can be
objectively related to an event occurring after the impairment loss was
recognized in net income, the impairment loss is reversed, with the
reversal recognized in net income. However, any subsequent recovery in
the fair value of an impaired available-for-sale equity security is
recognized in other comprehensive income until the equity security is
sold or redeemed.

g)Securities purchased under resale agreements and securities sold
under repurchase agreements

Securities purchased under resale agreements represent a purchase of
Government of Canada securities by the Bank effected with a
simultaneous agreement to sell them back at a specified price on a
future date, which is generally short term. The difference between the
cost of the purchase and the predetermined proceeds to be received on a
resale agreement is recorded as securities interest income.

Securities sold under repurchase agreements represent a sale of
Government of Canada securities by the Bank effected with a
simultaneous agreement to buy them back at a specified price on a
future date, which is generally short term. The difference between the
proceeds of the sale and the predetermined cost to be paid on a resale
agreement is recorded as deposit interest expense.

Securities purchased under resale agreements have been designated as
available-for-sale and are reported on the consolidated balance sheets
at fair value with changes in fair value reported in other
comprehensive income, net of income taxes.

h)Loans

Loans, including leases, are recorded at amortized cost and stated net
of unearned income, unamortized premiums and allowance for credit
losses (Note 1(i)). Interest income is recorded using the effective
interest method.

Loans are determined to be impaired when payments are contractually past
due 90 days, or where the Bank has commenced realization proceedings,
or where the Bank is of the opinion that the loan should be regarded as
impaired based on objective evidence. Objective evidence that a loan is
impaired can include significant financial difficulty of the borrower,
default or delinquency of a borrower, breach of loan covenants or
conditions, or indications that a borrower will enter bankruptcy. An
exception may be made where the Bank determines that the loan is well
secured and in the process of collection, and the collection efforts
are reasonably expected to result in either repayment of the loan or
restoring it to current status within 180 days from the date the
payment went in arrears. All loans are classified as impaired when a
payment is 180 days in arrears other than loans guaranteed or insured
for both principal and interest by the Canadian government, the
provinces or a Canadian government agency. These loans are classified
as impaired when payment is 365 days in arrears.

Impairment is measured as the difference between the carrying value of
the loan at the time it is classified as impaired and the present value
of the expected cash flows (estimated realizable amount), using the
interest rate originally inherent in the loan. When the amounts and
timing of future cash flows cannot be reliably estimated, either the
fair value of the security underlying the loan, net of any expected
realization costs, or the current market price for the loan may be used
to measure the estimated realizable amount. Impaired loans are returned
to performing status when the timely collection of both principal and
interest is reasonably assured, all delinquent principal and interest
payments are brought current, and all charges for loan impairment have
been reversed.

Loan fees, net of directly related costs, are amortized to interest
income using the effective interest method. Premiums paid on the
acquisition of loan portfolios are amortized to interest income using
the effective interest method.

i)Allowance for credit losses

An allowance for credit losses is maintained which, in the Bank's
opinion, is adequate to absorb credit related impairment losses
incurred in its loan portfolio. The allowance for credit losses is
calculated on individual loans (specific allowance) and on groups of
loans assessed collectively (collective allowance). The adequacy of the
allowance for credit losses is reviewed at least quarterly. The
allowance for credit losses is deducted from the outstanding loan
balance. Losses expected from future events are not recognized.

Specific Allowance

The specific allowance includes all the accumulated provisions for
losses on identified impaired loans required to reduce the carrying
value of those loans to their estimated realizable amount. See Note 1
(h) for the identification process of impaired loans.

If the amount of an impairment loss decreases in a subsequent period,
and the decrease can be objectively related to an event occurring after
the impairment was recognized, the specific loan impairment allowance
is reduced accordingly. The reversal of impairment is recognized in the
consolidated statements of income in provision for credit losses.

Collective Allowance

The collective allowance for credit risk includes provisions for losses
that have been incurred but have not yet been identified on an
individual loan or account basis by the Bank. As soon as information
becomes available which identifies losses on individual loans within
the collective group, those loans are removed from the group and
assessed on an individual basis for impairment.

The collective allowance for credit risk is established by taking into
consideration:

Historical trends in the loss experience during economic cycles;

The current portfolio profile;

Historical loss experience in portfolios of similar credit risk
characteristics;

The estimated period between impairment occurring and the loss being
identified; and

CWB's expert judgment as to whether current economic and credit
conditions are such that the actual level of inherent losses at the
balance sheet date is likely to be greater or less than that suggested
by historical experience.

Actual write-offs, net of recoveries, are deducted from the allowance
for credit losses. The provision for credit losses in the consolidated
statements of income is charged with an amount sufficient to keep the
balance in the allowance for credit losses adequate to absorb all
incurred credit related losses.

Write-off of Loans

The Bank writes off a loan against the related specific allowance when
the Bank determines that the loan is uncollectible. This determination
is made after considering the Bank's ability to recover the loan or
whether security proceeds will be insufficient to recover the loan.

j)Property and equipment

Land is carried at cost. Buildings, equipment and furniture, and
leasehold improvements are carried at cost less accumulated
depreciation and impairment.

Depreciation is calculated primarily using the straight-line method over
the estimated useful life of the asset, as follows:

- Buildings	20 years;
- Equipment and furniture	3 to 10 years; and
- Leasehold improvements	over the shorter of the term of the lease and the remaining useful life.

When components of an item of property and equipment have different
useful lives, they are accounted for as separate items. Gains and
losses on disposal are recorded in other income in the period of
disposal. Property and equipment is subject to an impairment review if
there are events or changes in circumstances which indicate that the
carrying amount may not be recoverable.

k)Goodwill and intangible assets

Goodwill

On the date of acquisition, goodwill arises on the acquisition of
subsidiaries and represents the excess of the fair value of the
purchase consideration, including any amount of any non-controlling
interest in the acquiree, over the net recognized amounts of the
identifiable assets, liabilities assumed, including identifiable
intangible assets. For the purposes of calculating goodwill, fair
values of acquired assets and liabilities are determined by reference
to market values or by discounting expected future cash flows to
present value. This discounting is performed using either market
rates, or risk-free rates with risk-adjusted expected future cash
flows.

Goodwill is stated at cost less accumulated impairment losses.

Intangible assets

Intangible assets arise from contractual or other legal rights and are
recognized separately from goodwill when their fair value can be
reliably measured. Intangible assets with a finite useful life are
recorded at cost less any accumulated amortization and impairment
losses. The assets' useful lives are confirmed at least annually.
Certain intangible assets, such as trademarks, have an indefinite
useful life. These indefinite life intangibles are not amortized but
are tested for impairment at least annually or more frequently if
events or changes in circumstances indicate that impairment may have
occurred.

Intangible assets with finite useful lives are amortized on a straight
line basis as follows:

- Customer relationships	10 to 15 years;
- Non-competition agreements	4 to 5 years; and
- Other	3 to 5 years.

Impairment

The carrying amounts of the Bank's intangible assets with finite useful
lives are reviewed at each reporting date to determine whether there is
any indication of impairment. If an indication exists, the Bank tests
for impairment. For goodwill and intangible assets with indefinite
useful lives, the impairment tests are performed each year. Goodwill is
allocated to cash-generating units for the purpose of impairment
testing considering the business level at which goodwill is monitored
for internal management purposes.

Impairment testing is performed by comparing the estimated recoverable
amount from a cash-generating unit with the carrying amount of its net
assets, including attributable goodwill. The recoverable amount of an
asset is the higher of its fair value less cost to sell, and its value
in use. If the recoverable amount is less than the carrying value, an
impairment loss is charged to the income statement.

l)Derivative financial instruments

Interest rate, foreign exchange and equity contracts such as futures,
options, swaps, floors and rate locks are entered into for risk
management purposes in accordance with the Bank's asset liability
management policies. It is the Bank's policy not to utilize derivative
financial instruments for trading or speculative purposes. Equity swaps
are used to reduce the earnings volatility from restricted share units
linked the Bank's common share price. Interest rate swaps and floors
are primarily used to reduce the impact of fluctuating interest rates.
Equity contracts are used to economically offset the return paid on
deposit products that are linked to a stock index. Foreign exchange
contracts are only used for the purposes of meeting needs of clients or
day-to-day business.

Designated Hedges

The Bank designates certain derivative financial instruments as either a
hedge of the fair value of recognized assets or liabilities or firm
commitments (fair value hedges), or a hedge of highly probable future
cash flows attributable to a recognized asset or liability or a
forecasted transaction (cash flow hedges). On an ongoing basis, the
derivatives used in hedging transactions are assessed to determine
whether they are effective in offsetting changes in fair values or cash
flows of the hedged items. If a hedging transaction becomes
ineffective or if the derivative is not designated as a cash flow
hedge, any subsequent change in the fair value of the hedging
instrument is recognized in net income.

Interest income received or interest expense paid on derivative
financial instruments is accounted for on the accrual basis and
recognized as interest expense over the term of the hedge contract.
Premiums on purchased contracts are amortized to interest expense over
the term of the contract. Accrued interest receivable and payable and
deferred gains and losses for these contracts are recorded in other
assets or liabilities as appropriate.

When a hedging instrument expires or is sold, or when a hedge no longer
meets the criteria for hedge accounting, any cumulative gain or loss
existing in other comprehensive income at that time remains separately
in equity until the forecast transaction is eventually recognized in
the income statement. When a forecasted transaction is no longer
expected to occur, the cumulative gain or loss that was reported in
other comprehensive income is immediately reclassified to the income
statement.

Embedded Derivatives

Certain derivatives embedded in other financial instruments, such as the
return on fixed term deposits that are linked to a stock index, are
treated as separate derivatives when their economic characteristics and
risk are not closely related to those of the host contract and the
combined contract is not carried at fair value. Embedded derivatives
identified have been separated from the host contract and are recorded
at fair value.

Fair Value

Derivative financial instruments are recorded on the balance sheet at
fair value as either other assets or other liabilities with changes in
fair value related to the effective portion of cash flow interest rate
hedges recorded in other comprehensive income, net of income taxes.
Changes in fair value related to the ineffective portion of a
designated hedge, a derivative not designated as a hedge and all other
derivative financial instruments are reported in other income on the
consolidated statements of income.

m)Stock based compensation

Stock Options

Stock options are accounted for using the fair value method. The
estimated value is recognized over the applicable vesting period as an
increase to both salary expense and share-based payment reserve. When
options are exercised, the proceeds received and the applicable amount
in share-based payment reserve are credited to capital stock.

Restricted Share Units

Under the Restricted Share Unit (RSU) plan, certain employees are
eligible to receive an award in the form of RSUs. Each RSU entitles the
holder to receive the cash equivalent of the market value of the Bank's
common shares at the vesting date and an amount equivalent to the
dividends paid on the common shares during the vesting period. RSUs
vest on each anniversary of the grant in equal one-third instalments
over a vesting period of three years. Salary expense is recognized over
the vesting period except where the employee is eligible to retire
prior to the vesting date, in which case the expense is recognized
between the grant date and the date the employee is eligible to retire.

Deferred Share Units

Under the Deferred Share Unit (DSU) plan, non-employee directors receive
at least 50% of their annual retainer in DSUs. The DSUs are not
redeemable until the individual is no longer a director and must be
redeemed for cash. Common share dividend equivalents accrue to the
directors in the form of additional units. The expense related to the
DSUs is recorded in the period the award is earned by the director.

n)Insurance operations

Insurance Contracts - Classification

Contracts where CWB accepts significant insurance risk from another
party by agreeing to compensate the policyholder or other beneficiary
if a specified uncertain future event adversely affects the
policyholder or other beneficiaries are classified as insurance
contracts.

Premiums Earned and Deferred Policy Acquisition Costs

Insurance premiums are included in other income on a daily pro rata
basis over the terms of the underlying insurance policies. Unearned
premiums represent the portion of premiums written that relate to the
unexpired term of the policies in force and are included in other
liabilities. Insurance premiums are shown before deduction of
commissions and are gross of any taxes and dues levied on premiums.

Policy acquisition costs are those expenses incurred in the acquisition
of insurance business. Acquisition costs comprise advertising and
marketing expenses, insurance advisor salaries and benefits, premium
taxes and other expenses directly attributable to the production of
business. Policy acquisition costs related to unearned premiums are
only deferred, and included in other assets, to the extent that they
are expected to be recovered from unearned premiums and are amortized
to income over the periods in which the premiums are earned. If the
unearned premiums are not sufficient to pay expected claims and
expenses (including policy maintenance expenses and unamortized policy
acquisition costs), a premium deficiency is said to exist. Anticipated
investment income is considered in determining whether a premium
deficiency exists. Premium deficiencies are recognized by writing down
the deferred policy acquisition cost asset.

Liability Adequacy Test

At the end of each reporting period, liability adequacy tests are
performed to ensure the adequacy of the contract liabilities, net of
related deferred policy acquisition costs (DPAC). In performing these
tests, current best estimates of future contractual cash flows and
claims handling and administration expenses, as well as investment
income from the assets supporting the provisions, are used. Any
deficiency is immediately charged to profit or loss by writing off DPAC
and, if required, establishing a provision for losses arising from
liability adequacy tests (the premium deficiency).

Unpaid Claims and Adjustment Expenses

The provision for unpaid claims represents the amounts needed to provide
for the estimated ultimate expected cost of claims incurred (both
reported and unreported) but not settled at the end of the reporting
period. The provision for adjustment expenses represents the estimated
ultimate expected costs of investigating, resolving and processing
these claims. These provisions are included in other liabilities and
their computation takes into account the time value of money using
discount rates based on projected investment income from the assets
supporting the provisions.

The process of determining the provision for unpaid claims and
adjustment expenses necessarily involves risks that the actual results
will deviate from the best estimates made. These risks vary in
proportion to the length of the estimation period and the volatility of
each component comprising the liabilities. To recognize the
uncertainty in establishing these best estimates and to allow for
possible deterioration in experience, actuaries are required to include
explicit provisions for adverse deviation in assumptions for asset
defaults, reinvestment risk, claims development and recoverability of
reinsurance balances.

The provisions are periodically reviewed and evaluated in light of
emerging claims experience and changing circumstances. The resulting
changes in estimates of the ultimate liability are recorded as incurred
claims in the current period.

Reinsurance Ceded

Earned premiums and claims expenses are recorded net of amounts ceded
to, and recoverable from, reinsurers. Estimates of amounts recoverable
from reinsurers on unpaid claims and adjustment expenses are recorded
in other assets separately from estimated amounts payable to
policyholders. Amounts recoverable from reinsurers are estimated in a
manner consistent with the liabilities associated with the reinsured
policies.

These assets consist of short-term balances due from reinsurers, as well
as longer term receivables that are dependent on the expected claims
and benefits arising under the related reinsured insurance contracts.
Amounts recoverable from or due to reinsurers are measured consistently
with the amounts associated with the reinsured insurance contracts and
in accordance with the terms of each reinsurance contract. Reinsurance
liabilities are primarily premiums payable for reinsurance contracts
and are recognized as an expense in the period paid.

Reinsurance assets are assessed for impairment on an annual basis. If
there is objective evidence that the reinsurance asset is impaired, the
carrying amount of the reinsurance asset is reduced to its recoverable
amount and the impairment loss is recognized in the income statement.
Objective evidence that a reinsurance asset is impaired is gathered
using observable data about the following criteria:

Significant financial difficulty of the reinsurer;

A breach of contract, such as default or delinquency in payments; and

Observable data indicating that there is a measurable decrease in the
estimated future cash flow from the reinsurance asset since its initial
recognition.

o)Income taxes

The Bank follows the deferred method of accounting for income taxes
whereby current income taxes are recognized for the estimated income
taxes payable for the current period. Deferred tax assets and
liabilities represent the cumulative amount of tax applicable to
temporary differences between the carrying amount of the assets and
liabilities, and their values for tax purposes. Deferred tax assets and
liabilities are measured using enacted or substantively enacted tax
rates anticipated to apply to taxable income in the years in which
those temporary differences are anticipated to be recovered or settled.
Changes in deferred income taxes related to a change in tax rates are
recognized in income in the period of the tax rate change. All deferred
income tax assets and liabilities are expected to be realized in the
normal course of operations.

p)Employee Future Benefits

All employee future benefits related to the Bank's group retirement
savings and employee share purchase plans are recognized in the periods
during which services are rendered by employees.

q)Earnings per common share

Basic earnings per common share is calculated based on the average
number of common shares outstanding during the period. Diluted earnings
per share is calculated based on the treasury stock method, which
assumes that any proceeds from in-the-money stock options or the
exercise of warrants on common shares are used to purchase the Bank's
common shares at the average market price during the period.

r)Fair value of financial instruments

The fair value of a financial instrument on initial recognition is
normally the transaction price (i.e. the value of the consideration
given or received). Subsequent to initial recognition, financial
instruments measured at fair value that are quoted in active markets
are based on bid prices for financial assets and offer prices for
financial liabilities. For certain securities and derivative financial
instruments where an active market does not exist, fair values are
determined using valuation techniques that refer to observable market
data, including discounted cash flow analysis, option pricing models
and other valuation techniques commonly used by market participants,
and unobservable market data.

The use of financial instruments exposes the Bank to credit, liquidity
and market risk. A discussion of how these and other risks are managed
can be found in the 2011 consolidated annual financial statements.

2. Future Accounting Changes

CWB continues to monitor the IASB's proposed changes to accounting
standards. Although not expected to materially impact the Bank's 2012
consolidated financial statements, these proposed changes may have a
significant impact on future financial statements. Additional
discussion on certain accounting standards that may impact the Bank is
included in the Q1 2012 Management's Discussion and Analysis.

3. Insurance Revenues, Net

Insurance revenues, net, as reported in other income on the consolidated
statement of income are presented net of net claims and adjustment
expenses, and policy acquisition costs.


	For the three months ended
		January 31 2012		October 31 2011		January 31 2011
Net earned premiums	$	30,454	$	30,252	$	28,996
Commissions and processing fees		455		459		465
Net claims and adjustment expenses		(20,327)		(19,703)		(19,157)
Policy acquisition costs		(6,180)		(6,065)		(5,714)
Total, net	$	4,402	$	4,943	$	4,590

4. Securities

Net unrealized gains (losses) reflected on the balance sheet follow:

		As at January 31 2012		As at October 31 2011		As at January 31 2011		As at November 1 2010
Interest bearing deposits with regulated financial institutions	$	477	$	815	$	1,227	$	2,104
Securities issued or guaranteed by
Canada		(210)		(645)		22		(139)
A province or municipality		(82)		(479)		535		723
Other debt securities		1,588		1,827		1,841		3,412
Equity securities
Preferred shares		16,091		9,312		11,531		20,731
Common shares		892		28		12,049		7,669
Unrealized gains, net	$	18,756	$	10,858	$	27,205	$	34,500

The securities portfolio is primarily comprised of high quality debt
instruments, preferred shares and common shares that are not held for
trading purposes and, where applicable, are typically held until
maturity. Fluctuations in value are generally attributed to changes in
interest rates, market credit spreads and shifts in the interest rate
curve. Volatility in equity markets also leads to fluctuations in
value, particularly for common shares. The Bank has assessed the
securities with unrealized losses and, based on available objective
evidence, does not consider the securities to be impaired.

5. Loans

The composition of the Bank's loan portfolio by geographic region and
industry sector follows:

($ millions)		BC			AB			SK			MB			Other			Total		January 31 2012 Composition Percentage		October 31 2011 Composition Percentage		January 31 2011 Composition Percentage		November 1 2010 Composition Percentage
Loans to Individuals
Residential mortgages⁽²⁾	$	1,347		$	1,188		$	198		$	75		$	275		$	3,083		24	%	24	%	24	%	23	%
Other loans		72			112			12			3			1			200		2		2		2		2
		1,419			1,300			210			78			276			3,283		26		26		26		25
Loans to Businesses
Commercial		961			1,737			138			105			393			3,334		26		25		26		26
Construction and real estate⁽³⁾		1,450			1,694			246			79			182			3,651		28		29		30		31
Equipment financing⁽⁴⁾		406			858			170			79			677			2,190		17		17		16		16
Energy		-			361			-			-			-			361		3		3		2		2
		2,817			4,650			554			263			1,252			9,536		74		74		74		75
Total Loans⁽¹⁾	$	4,236		$	5,950		$	764		$	341		$	1,528		$	12,819		100	%	100	%	100	%	100	%
Composition Percentage
January 31, 2012		33	%		46	%		6	%		3	%		12	%		100	%
October 31, 2011		33	%		46	%		6	%		3	%		12	%		100	%
January 31, 2011		33	%		48	%		6	%		3	%		10	%		100	%
November 1, 2010		33	%		48	%		6	%		3	%		10	%		100	%

	⁽¹⁾ This table does not include an allocation for credit losses.
	⁽²⁾ Includes single- and multi-unit residential mortgages and project (interim) mortgages on residential property.
	⁽³⁾ Includes commercial term mortgages and project (interim) mortgages for non-residential property.
	⁽⁴⁾ Includes securitized leases reported on-balance sheet of $150 (October 31, 2011 - $91; January 31, 2011 - $170; November 1, 2010 - $199).

6. Allowance for Credit Losses

The following table shows the changes in the allowance for credit
losses:


	For the three months ended January 31, 2012						For the three months ended October 31, 2011
		Specific Allowance		Collective Allowance for Credit Losses		Total		Specific Allowance		Collective Allowance for Credit Losses		Total
Balance at beginning of period	$	10,650	$	61,330	$	71,980	$	13,418	$	58,980	$	72,398
Provision for credit losses		5,088		1,341		6,429		2,833		2,350		5,183
Write-offs		(4,524)		-		(4,524)		(6,504)		-		(6,504)
Recoveries		671		-		671		903		-		903
Balance at end of period	$	11,885	$	62,671	$	74,556	$	10,650	$	61,330	$	71,980


							For the three months ended January 31, 2011
								Specific Allowance		Collective Allowance for Credit Losses		Total
Balance at beginning of period							$	19,531	$	61,992	$	81,523
Provision for credit losses								6,022		228		6,250
Write-offs								(10,417)		-		(10,417)
Recoveries								237		-		237
Balance at end of period							$	15,373	$	62,220	$	77,593

7. Impaired and Past Due Loans

Outstanding gross loans and impaired loans, net of allowance for credit
losses, by loan type, are as follows:


	As at January 31, 2012								As at October 31, 2011
		Gross Amount		Gross Impaired Amount		Specific Allowance	Net Impaired Loans			Gross Amount		Gross Impaired Amount	Specific Allowance			Net Impaired Loans
Consumer and personal	$	2,095,429	$	19,924	$	1,206	$	18,718	$	2,018,627	$	24,983	$	1,173	$	23,810
Real estate⁽¹⁾		4,809,796		44,221		3,130		41,091		4,722,018		46,638		2,516		44,122
Equipment financing		2,549,898		10,851		4,551		6,300		2,502,620		15,596		5,592		10,004
Commercial		3,364,324		15,861		2,998		12,863		3,121,997		10,041		1,369		8,672
Total ⁽²⁾	$	12,819,447	$	90,857	$	11,885		78,972	$	12,365,262	$	97,258	$	10,650		86,608
Collective allowance⁽³⁾								(62,671)								(61,330)
Net impaired loans after collective allowance							$	16,301							$	25,278

	As at January 31, 2011								As at November 1, 2010
		Gross Amount		Gross Impaired Amount		Specific Allowance		Net Impaired Loans		Gross Amount		Gross Impaired Amount	Specific Allowance			Net Impaired Loans
Consumer and personal	$	1,857,252	$	26,919	$	2,033	$	24,886	$	1,793,181	$	24,534	$	1,288	$	23,246
Real estate⁽¹⁾		4,211,834		75,153		4,179		70,974		4,115,560		82,799		4,880		77,919
Equipment financing		2,195,588		16,569		6,545		10,024		2,141,276		28,411		10,708		17,703
Commercial		2,848,840		14,290		2,616		11,674		2,706,203		7,956		2,655		5,301
Total ⁽²⁾	$	11,113,514	$	132,931	$	15,373	$	117,558	$	10,756,220	$	143,700	$	19,531		124,169
Collective allowance⁽³⁾								(62,220)								(61,992)
Net impaired loans after collective allowance							$	55,338							$	62,177

⁽¹⁾Multi-family residential mortgages are included in real estate loans.
⁽²⁾Gross impaired loans include foreclosed assets with a carrying value of $4,683 (October 31, 2011 - $3,241; January 31, 2011 - $1,591 and November 1, 2010 - $867) which are held for sale. The Bank pursues timely realization on foreclosed assets and does not use the assets for its own operations.
⁽³⁾The collective allowance for credit risk is not allocated by loan type.

Outstanding impaired loans, net of allowance for credit losses, by
provincial location of security, are as follows:



	As at January 31, 2012						As at October 31, 2011
	Gross Impaired Amount		Specific Allowance		Net Impaired Loans			Gross Impaired Amount	Specific Allowance			Net Impaired Loans
Alberta	$	45,362	$	6,150	$	39,212	$	53,725	$	5,208	$	48,517
British Columbia		38,434		2,199		36,235		35,762		1,441		34,321
Saskatchewan		2,545		760		1,785		2,809		823		1,986
Manitoba		845		265		580		953		328		625
Other		3,671		2,511		1,160		4,009		2,850		1,159
Total	$	90,857	$	11,885		78,972	$	97,258	$	10,650		86,608
Collective allowance⁽¹⁾						(62,671)						(61,330)
Net impaired loans after collective allowance					$	16,301					$	25,278

	As at January 31, 2011						As at November 1, 2010
		Gross Impaired Amount	Specific Allowance			Net Impaired Loans		Gross Impaired Amount	Specific Allowance			Net Impaired Loans
Alberta	$	79,700	$	8,067	$	71,633	$	99,067	$	14,609	$	84,458
British Columbia		35,098		1,145		33,953		38,587		1,303		37,284
Saskatchewan		2,221		832		1,389		2,178		1,183		995
Manitoba		828		364		464		364		268		96
Other		15,084		4,965		10,119		3,504		2,168		1,336
Total	$	132,931	$	15,373		117,558	$	143,700	$	19,531		124,169
Collective allowance⁽¹⁾						(62,220)						(61,992)
Net impaired loans after collective allowance					$	55,338					$	62,177

⁽¹⁾The collective allowance for credit risk is not allocated by province.

Gross impaired loans exclude certain past due loans where payment of
interest or principal is contractually in arrears, which are not
classified as impaired. Details of such past due loans that have not
been included in the gross impaired amount are as follows:


	As at January 31, 2012
	1 - 30 days		31 - 60 days		61 - 90 days		More than 90 days			Total
Residential mortgages	$	7,139	$	6,893	$	1,943	$	620	$	16,595
Other loans		22,930		27,427		2,358		-		52,715
	$	30,069	$	34,320	$	4,301	$	620	$	69,310

Total as at October 31, 2011	$	23,971	$	16,688	$	1,873	$	352	$	42,884
Total as at January 31, 2011	$	27,493	$	28,030	$	2,596	$	190	$	58,309
Total as at November 1, 2010 ⁽¹⁾	$	23,639	$	41,871	$	9,643	$	4	$	75,157

⁽¹⁾ Amounts at November 1, 2010 did not include National Leasing Group Inc.
(National Leasing).

8. Derivative Financial Instruments

For the quarter ended January 31, 2012, $395 net unrealized after tax
losses (2011 - nil) were recorded in other comprehensive income for
changes in fair value of the effective portion of equity swap
derivatives designated as cash flow hedges, and no amounts (2011 - nil)
were recorded in other income for changes in fair value of the
ineffective portion of derivatives classified as cash flow hedges.
Equity swaps are used to reduce the earnings volatility from restricted
share units linked the Bank's common share price. Amounts accumulated
in other comprehensive income are reclassified to net income in the
same period that salary expense on restricted share units (i.e. the
hedged items) affects income. For the three months ended January 31,
2012, $296 net losses after tax amounts (2011 - nil) were reclassified
to net income.

The following table shows the notional value outstanding for derivative
financial instruments and the related fair value:



	As at January 31, 2012						As at October 31, 2011
		Notional Amount		Positive Fair Value		Negative Fair Value		Notional Amount		Positive Fair Value		Negative Fair Value
Equity swaps designated as hedges⁽¹⁾	$	14,214	$	-	$	533	$	-	$	-	$	-
Foreign exchange contracts⁽²⁾		3,517		-		6		6,384		-		16
Interest rate swaps not designated as hedges		-		-		-		19,400				420
Other forecasted transactions		-		-		-		-		-		-
Derivative related amounts			$	-	$	539			$	-	$	436

	As at January 31, 2011						As at November 1, 2010
		Notional Amount		Positive Fair Value		Negative Fair Value		Notional Amount		Positive Fair Value		Negative Fair Value
Foreign exchange contracts	$	33,549	$	127	$	152	$	57,032	$	132	$	59
Interest rate swaps not designated as hedges		41,400		-		656		47,550		-		930
Equity contracts		500		3		-		500		2		-
Embedded derivatives in equity-linked deposits		n/a		-		4		n/a		-		3
Other forecasted transactions		-		-		-		-		-		-
Derivative related amounts			$	130	$	812			$	134	$	992

⁽¹⁾Equity swaps designated as hedges outstanding at January 31, 2012 mature between June 2012 and June 2014. Equity swaps are used to reduce the earnings volatility from restricted share units linked the Bank's common share price. This is the first quarter the Bank has entered into equity swaps. ⁽²⁾Foreign exchange contracts outstanding at January 31, 2012 mature between February 2012 and December 2012. n/a - not applicable There were no forecasted transactions that failed to occur during the three months ended January 31, 2012.

9. Capital Stock

Share Capital


	For the three months ended
	January 31, 2012				January 31, 2011
		Number of Shares		Amount		Number of Shares		Amount
Preferred Shares - Series 3
Outstanding at beginning and end of period⁽¹⁾		8,390,000	$	209,750		8,390,000	$	209,750
Common Shares
Outstanding at beginning of period		75,461,981		408,282		66,641,362		279,620
Issued on exercise or exchange of options		134,116		379		136,955		1,291
Issued under dividend reinvestment plan⁽²⁾		97,693		2,492		22,657		574
Transferred from contributed surplus on exercise or exchange of options		-		967		-		1,491
Issued on exercise of warrants		-		-		2,902,290		40,632
Outstanding at end of period		75,693,790		412,120		69,703,264		323,608
Share Capital			$	621,870			$	533,358

⁽¹⁾ Holders of the Preferred Shares - Series 3 are entitled to receive non-cumulative quarterly fixed dividends for the initial five-year period ending April 30, 2014 of 7.25% per annum, payable quarterly, as and when declared. For further information on dividend rates after April 30, 2014, refer to Note 19 of the audited consolidated financial statements for the year ended October 31, 2011 (see page 103 of the 2011 Annual Report).
⁽²⁾ Shares were issued at a 2% discount from the average closing price of the five trading days preceding the dividend payment date.

Warrants to Purchase Common Shares

Each warrant was exercisable at a price of $14.00 to purchase one common
share in the capital of the Bank.

	For the three months ended
Number of Warrants		January 31 2012	January 31 2011
Outstanding at beginning of period		-	13,471,611
Purchased and cancelled under Normal Course Issuer Bid		-	(500,000)
Exercised		-	(2,902,290)
Outstanding at end of period		-	10,069,321

Common Share Normal Course Issuer Bid

On October 31, 2011, the Bank received approval from the Toronto Stock
Exchange to institute a Normal Course Issuer Bid (NCIB) to purchase and
cancel up to 2,261,434 of its common shares. The NCIB commenced
November 2, 2011 and will expire November 1, 2012. No common shares
have been purchased under this NCIB as at January 31, 2012.

10. Stock-Based Compensation

Stock Options

For the three months ended

January 31, 2012

January 31, 2011

Number of Options

Weighted

Average

Exercise Price

Number of

Options

Weighted

Average

Exercise

Price

Options

Balance at beginning of period

3,542,072

21.36

3,834,433

19.93

Granted

729,830

25.46

358,865

29.42

Exercised or exchanged

(326,880)

16.70

(361,650)

21.33

Forfeited

(25,574)

23.49

(14,643)

22.98

Balance at end of period

3,919,448

22.50

3,817,005

20.68

The terms of the share incentive plan allow the holders of vested
options a cashless settlement alternative whereby the option holder can
either (i) elect to receive shares by delivering cash to the Bank in
the amount of the option exercise price or (ii) elect to receive the
number of shares equivalent to the excess of the market value of the
shares under option, determined at the exercise date, over the exercise
price. Of the 326,880 (2011 - 361,650) options exercised or exchanged,
option holders exchanged the rights to 300,580 (2011 - 304,650) options
and received 107,816 (2011 - 79,955) shares in return under the
cashless settlement alternative.

For the three months ended January 31, 2012, salary expense of $1,162
(2011 - $1,289) was recognized relating to the estimated fair value of
options granted. The fair value of options granted was estimated using
a binomial option pricing model with the following variables and
assumptions: (i) risk-free interest rate of 1.1% (2011 - 2.2%), (ii)
expected option life of 4.0 (2011 - 4.0) years, (iii) expected annual
volatility of 31% (2011 - 41%), and (iv) expected annual dividends of
2.4% (2011 - 1.8%). The weighted average fair value of options granted
was estimated at $4.70 (2011 - $8.69) per share.

Further details relating to stock options outstanding and exercisable at
January 31, 2012 follow:


	Options Outstanding					Options Exercisable
Range of Exercise Prices		Number of Options	Weighted Average Remaining Contractual Life (years)		Weighted Average Exercise Price		Number of Options		Weighted Average Exercise Price
$ 8.58 to $11.76		714,070	1.9	$	11.71		703,570	$	11.76
$16.89 to $21.46		685,940	2.0		18.67		266,790		21.46
$22.09 to $26.38		1,615,924	3.5		24.52		274,550		26.17
$28.11 to $31.18		903,514	3.1		30.31		183,775		31.13
Total		3,919,448	2.9	$	22.50		1,428,685	$	18.83

Restricted Share Units

For the three months ended January 31, 2012, salary expense of $1,275
(2011 - $2,782) was recognized related to RSUs. As at January 31, 2012,
the liability for the RSUs held under this plan was $10,064 (2011 -
$11,416). At the end of each period, the liability and salary expense
are adjusted to reflect changes in the fair value of the RSUs. As at
January 31, 2012, 535,014 RSUs were outstanding (2011 - 478,886).

Deferred Share Units

For the three months ended January 31, 2012, non-interest expenses
"other expenses" included a $90 recovery (2011 - $248 expense) related
to the DSUs. As at January 31, 2012, the liability for DSUs held under
this plan was $1,377 (2011 - $713). At the end of each period, the
liability and expense are adjusted to reflect changes in the fair value
of the DSUs.

11. Contingent Liabilities and Commitments

Significant contingent liabilities and commitments, including guarantees
provided to third parties, are discussed in Note 21 of the Bank's
audited consolidated financial statements for the year ended October
31, 2011 (see page 106 of the 2011 Annual Report) and include:


		As at January 31 2012		As at October 31 2011		As at January 31 2011		As at November 1 2010
Guarantees and standby letters of credit
	Balance outstanding	$	297,572	$	276,323	$	266,827	$	261,438
Business credit cards
	Total approved limit		20,522		12,996		13,037		13,153
	Balance outstanding		2,793		2,933		3,018		2,927

In the ordinary course of business, the Bank and its subsidiaries are
party to legal proceedings. Based on current knowledge, CWB does not
expect the outcome of any of these proceedings to have a material
effect on the consolidated financial position or results of operations.

12.Fair Value of Financial Instruments

The Bank categorizes its fair value measurements of financial
instruments recorded on the consolidated balance sheets according to a
three-level hierarchy. Level 1 fair value measurements reflect
published market prices quoted in active markets. Level 2 fair value
measurements were estimated using a valuation technique based on
observable market data. Level 3 fair value measurements were determined
using a valuation technique based on unobservable market data.

Further information on how the fair value of financial instruments is
determined is included in Note 30 of the October 31, 2011 consolidated
audited financial statements (see page 114 of the 2011 Annual Report).

The following table presents the Bank's financial assets and liabilities
that are carried at fair value, categorized by level under the fair
value hierarchy:

			Valuation Technique
As at January 31, 2012		Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash resources	$	228,964	$	206,883	$	22,081	$	-
Securities		2,079,791		2,079,791		-		-
Securities purchased under resale agreements		119,999		-		119,999		-
	$	2,428,754	$	2,286,674	$	142,080	$	-
Financial liabilities
Other liability	$	62,211	$	-	$	-	$	62,211
Derivative related		539		-		539		-
	$	62,750	$	-	$	539	$	62,211

			Valuation Technique
As at October 31, 2011		Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash resources	$	312,335	$	272,704	$	39,631	$	-
Securities		1,925,704		1,925,704		-		-
	$	2,238,039	$	2,198,408	$	39,631	$	-

Financial liabilities
Other liability	$	61,011	$	-	$	-	$	61,011
Derivative related		436		-		436		-
	$	61,447	$	-	$	436	$	61,011

		Valuation Technique
As at November 1, 2010		Fair Value		Level 1		Level 2		Level 3
Financial assets
Cash resources	$	187,944	$	181,143	$	6,801	$	-
Securities		1,510,187		1,510,187		-		-
Securities purchased under resale agreements		177,954		-		177,954		-
Derivative related		134		-		134		-
		1,876,219	$	1,691,330	$	184,889	$	-
Financial liabilities	$	48,705	$	-	$	-	$	48,705
Other liability		992		-		992		-
Derivative related	$	49,697	$	-	$	992	$	48,705

Level 3 Financial Instruments

Level 3 financial instruments are comprised of the contingent
consideration related to a subsidiary acquisition. The following table
shows a reconciliation of the fair value measurements related to the
Level 3 valued instrument:

	For the three months ended January 31
		2012		2011
Balance at beginning of period	$	61,011	$	48,705
Change in fair value recognized in other income - "other"		1,200		2,516
Settlements		-		-
Balance at end of period	$	62,211	$	51,221

Although the Bank deems the estimate of the Level 3 fair value as
appropriate, the use of different assumptions could lead to different
measurements of fair value. The probability of a call option premium
exercised by the Bank, forecasted net income of the subsidiary and the
discount rate used have the most significant impact on the valuation.
The undiscounted impact of a 10 percent increase and decrease in the
probability of the call option being exercised by the Bank would result
in a $1,393 increase and decrease in fair value, respectively. The
undiscounted impact of assuming a $1,000 increase or decrease in the
subsidiary's annual net income would result in a $2,517 increase and
decrease in fair value, respectively, assuming a nil probability of the
call option being exercised by the Bank.

13. Interest Rate Sensitivity

The Bank's exposure to interest rate risk as a result of a difference or
gap between the maturity or repricing behavior of interest sensitive
assets and liabilities, including derivative financial instruments, is
discussed in Note 29 of the audited consolidated financial statements
for the year ended October 31, 2011 (see page 113 of the 2011 Annual
Report). The following table shows the gap position for selected time
intervals.

Asset Liability Gap Positions

($ millions)		Floating Rate and Within 1 Month			1 to 3 Months			3 Months to 1 Year			Total Within 1 Year			1 Year to 5 Years			More than 5 Years			Non-interest Sensitive			Total
January 31, 2012
Assets
Cash resources and securities	$	353		$	662		$	458		$	1,473		$	696		$	157		$	103		$	2,429
Loans		5,821			715			1,534			8,070			4,694			52			(71)			12,745
Other assets		-			-			-			-			-			-			310			310
Derivative financial instruments⁽¹⁾		-			-			-			-			-			-			18			18
Total		6,174			1,377			1,992			9,543			5,390			209			360			15,502
Liabilities and Equity
Deposits		4,784			902			3,145			8,831			4,143			-			(13)			12,961
Other liabilities		3			6			26			35			35			8			358			436
Debt		6			133			48			187			423			75			-			685
Equity		-			-			-			-			105			-			1,297			1,402
Derivative financial instruments⁽¹⁾		-			-			-			-			-			-			18			18
Total		4,793			1,041			3,219			9,053			4,706			83			1,660			15,502
Interest Rate Sensitive Gap	$	1,381		$	336		$	(1,227)		$	490		$	684		$	126		$	(1,300)		$	-
Cumulative Gap	$	1,381		$	1,717		$	490		$	490		$	1,174		$	1,300		$	-		$	-
Cumulative Gap as a percentage of total assets		8.9	%		11.1	%		3.2	%		3.2	%		7.6	%		8.4	%		-	%		-	%

October 31, 2011
Cumulative gap	$	1,415		$	1,251		$	(59)		$	(59)		$	1,224		$	1,254		$	-		$	-
Cumulative gap as aPercentage of total assets		9.5	%		8.4	%		(0.4)	%		(0.4)	%		8.2	%		8.4	%		-	%		-	%

January 31, 2011
Cumulative gap	$	866		$	740		$	239		$	239		$	1,116		$	1,160		$	-		$	-
Cumulative gap as a percentage of total assets		6.6	%		5.6	%		1.8	%		1.8	%		8.5	%		8.8	%		-	%		-	%

November 1, 2010
Cumulative gap	$	1,002		$	808		$	188		$	188		$	1,082		$	1,127		$	-		$	-
Cumulative gap as a percentage of total assets		7.7	%		6.2	%		1.4	%		1.4	%		8.3	%		8.7	%		-	%		-	%

⁽¹⁾	Derivative financial instruments are included in this table at the notional amount.
⁽²⁾	Accrued interest is excluded in calculating interest sensitive assets and liabilities.
⁽³⁾	Potential prepayments of fixed rate loans and early redemption of redeemable fixed term deposits have not been estimated. Redemptions of fixed term deposits where depositors have this option are not expected to be material. The majority of fixed rate loans, mortgages and leases are either closed or carry prepayment penalties.

The effective, weighted average interest rates for each class of financial assets and liabilities are shown below:

January 31, 2012	Floating Rate and Within 1 Month		1 to 3 Months		3 Months to 1 Year		Total Within 1 Year		1 Year to 5 Years		More than 5 Years		Total
Total assets	3.9	%	2.4	%	4.5	%	3.8	%	5.3	%	5.3	%	4.3	%
Total liabilities	1.2		2.4		2.4		1.7		2.7		5.0		2.1
Interest rate sensitive gap	2.7	%	-	%	2.1	%	2.1	%	2.6	%	0.3	%	2.2	%

October 31, 2011
Total assets	4.0	%	2.4	%	4.6	%	3.9	%	5.2	%	5.1	%	4.4	%
Total liabilities	1.2		1.9		2.5		1.7		2.8		5.8		2.1
Interest rate sensitive gap	2.8	%	0.5	%	2.1	%	2.2	%	2.4	%	(0.7)	%	2.3	%

January 31, 2011
Total assets	4.0	%	2.8	%	4.7	%	4.0	%	5.4	%	5.3	%	4.6	%
Total liabilities	1.0		2.1		2.4		1.5		3.2		5.8		2.2
Interest rate sensitive gap	3.0	%	0.7	%	2.3	%	2.5	%	2.2	%	(0.5)	%	2.4	%

November 1, 2010
Total assets	3.9	%	2.8	%	4.9	%	4.0	%	5.5	%	5.2	%	4.6	%
Total liabilities	1.2		2.0		2.6		1.7		3.2		5.8		2.3
Interest rate sensitive gap	2.7	%	0.8	%	2.3	%	2.3	%	2.3	%	(0.6)	%	2.3	%

Based on the current interest rate gap position, it is estimated that a
one-percentage point increase in all interest rates would increase net
interest income by approximately 3.7% or $13,519 (January 31, 2011 -
2.7% or $8,894) and decrease other comprehensive income $10,098
(January 31, 2011 - $8,202) net of tax, respectively over the following
twelve months. A one-percentage point decrease in all interest rates
would decrease net interest income by approximately 4.5% or $16,549
(January 31, 2011 - 3.7% or $11,938) and increase other comprehensive
income $10,098 (January 31, 2011 - $8,202) net of tax.

14. Capital Management

Capital for Canadian financial institutions is managed and reported
until December 2012 in accordance with a capital management framework
specified by OSFI commonly called Basel II. A revised capital framework
(called Basel III) is effective for Canadian financial institutions
beginning on January 1, 2013. Further details are available in the
Capital Management section in the Q1 2012 Management's Discussion and
Analysis.

Capital funds are managed in accordance with policies and plans that are
regularly reviewed and approved by the Board of Directors and take into
account forecasted capital needs and markets. The goal is to maintain
adequate regulatory capital to be considered well capitalized, protect
customer deposits and provide capacity for internally generated growth
and strategic opportunities that do not otherwise require accessing the
public capital markets, all while providing a satisfactory return for
shareholders.

Additional information about the Bank's capital management practices is
provided in Note 32 to the fiscal 2011 audited financial statements
beginning on page 116 of the 2011 Annual Report.

The transition to IFRS, as described in Note 15, did not have a
significant effect on the Bank's regulatory capital. On an IFRS basis
as at October 31, 2011, the Banks Tier 1 and total regulatory capital
ratios would have declined 40 basis points to 10.7% and 15.0%,
respectively. The 2011 capital structure and regulatory ratios reflect
the returns filed and have not been restated to IFRS.


Capital Structure and Regulatory Ratios
			As at January 31 2012		As at October 31 2011			As at January 31 2011
Capital
	Tier 1 ⁽¹⁾	$	1,289,705		$	1,350,466		$	1,250,346
	Total		1,854,871			1,869,880			1,788,076
Capital ratios
	Tier 1		10.2	%		11.1	%		11.6	%
	Total		14.6			15.4			16.5
Assets to capital multiple			8.3	x		7.9	x		7.3	X

⁽¹⁾ The decrease in Tier 1 capital from October 31, 2011 to January 31,
2012 reflects the expiration of a Basel II transition provision that
permitted the capital deduction related to CWB's insurance subsidiary
($83,500 at January 31, 2012; $80,942 at October 31, 2011; $71,487 at
January 31, 2011) to be deducted from Tier 2 capital. Beginning in the
first quarter of 2012, the deduction is recorded 50% against Tier 1
capital and 50% against Tier 2 capital.

During the three months ended January 31, 2012, the Bank complied with
all internal and external capital requirements.

The Bank has received OSFI approval and will redeem $125,000
subordinated debentures with a fixed interest rate of 5.07% in March
2012. This redemption will reduce the total capital ratio by
approximately 90 basis points. Of the $125,000 debentures, $5,000 are
held by Canadian Direct Insurance Incorporated, a wholly owned
subsidiary, and have been eliminated on consolidation.

15. Transition to International Financial Reporting Standards (IFRS)

As stated in Note 1, these are the Bank's first interim consolidated
financial statements prepared in accordance with IFRS. In preparing the
opening IFRS consolidated balance sheet as at November 1, 2010, the
Bank has adjusted amounts reported previously in the consolidated
financial statements prepared in accordance with Canadian GAAP. An
explanation of how the transition from Canadian GAAP to IFRS has
affected the Bank is set out in the following tables and accompanying
notes. No material adjustments to the consolidated statement of cash
flows were required.

IFRS has been applied retrospectively, except for certain optional and
mandatory exemptions from full retrospective application provided for
under IFRS 1 - First time Adoption of IFRS (IFRS 1), as described below.

Optional exemption

Business combinations - The Bank has elected to apply IFRS 3 - Business Combinations prospectively only to business combinations on or after February 1,
2010. As a result, business combinations prior to February 1, 2010
have not been restated.

Mandatory exemptions

The Bank has made all mandatory exemptions as required under IFRS 1.

a)Business combinations

The Bank elected to apply IFRS retrospectively to business combinations
that occurred on or after February 1, 2010. This election resulted in
the adjustment of the February 1, 2010 acquisition of National
Leasing. The following transition adjustments were required:

Under Canadian GAAP, contingent consideration is recorded only when it
is determinable beyond a reasonable doubt. Under IFRS, certain
contingent consideration arrangements are reported at fair value as at
the acquisition date, and each period thereafter, the contingent
consideration fair value is re-measured and any adjustments are
recorded in the other income - "other" (non-tax deductible);

Under Canadian GAAP, acquisition-related costs are included in the cost
of the acquisition, while under IFRS, acquisition-related costs are
expensed; and

Under Canadian GAAP, the valuation of the Bank's shares issued as part
of the consideration for the acquisition is based on a reasonable time
frame before and after the acquisition date. Under IFRS, the valuation
is completed on the acquisition date.

The impact arising from the change is detailed in the following
consolidated balance sheets, income statements and statements of
comprehensive income under the heading "(a) Business Combinations".
The increase noted in other assets relates to goodwill, and the
increase noted in other liabilities relates to the acquisition
contingent consideration obligation.

b)Derecognition of securitized financial assets

The Bank participates in securitization activities. Securitization
consists of the transfer of equipment leases to an independent trust or
other third party, which purchases the cash flows associated with the
leases and may issue securities to investors. Under Canadian GAAP,
securitized assets are accounted for as sales and removed from the
consolidated balance sheet as the Bank surrenders control of the
transferred assets and receives consideration other than beneficial
interests in the transferred assets. Under IFRS, because the Bank
retains a significant portion of the credit risk relating to the
leases, the derecognition criteria within IAS 39 - Financial Instruments: Recognition and Measurement are not met and the leases are accounted for as a secured borrowing with
the underlying leases of the securitization remaining on the
consolidated balance sheet and a debt security recognized for the
funding received.

The impact arising from the change is detailed in the following
consolidated balance sheets, consolidated income statements and
consolidated statements of comprehensive income under the heading "(b)
Derecognition".

c)Consolidation

Under IFRS, a special purpose entity (SPE) is consolidated if it is
deemed to be controlled by the reporting entity, as determined under
specific criteria. Canadian Western Bank Capital Trust is consolidated
under IFRS, which resulted in a $105 million decrease in deposits and
the presentation of the CWB Capital Trust Capital Securities Series 1
(WesTS) as equity attributed to non-controlling interests.
Distributions on the WesTS that were effectively reported as deposit
interest expense under Canadian GAAP are now presented as an equity
dividend within IFRS "net income attributable to non-controlling
interests." For more information about this special purpose entity,
refer to Note 15 to the consolidated financial statements beginning on
page 100 of the 2011 Annual Report.

d)Impairment of available-for-sale securities

Under both Canadian GAAP and IFRS, available-for-sale securities are
reported on the balance sheet at fair value with changes in fair value
generally reported in other comprehensive income. An unrealized loss is
recognized in net income when a security is considered impaired; a
subsequent recovery in the value of an equity security is not reversed
through net income until the security is either sold or redeemed. Under
Canadian GAAP, a significant or prolonged decline in the fair value of
an investment below its cost is assessed in the context of whether it
is considered an "other than temporary impairment" (OTTI). Under IFRS,
the concept of OTTI does not exist and either a significant or
prolonged decline in fair value is considered objective evidence of
impairment. The differences between Canadian GAAP and IFRS will
generally result in earlier recognition of impairment losses through
net income under IFRS.

e)Other reclassifications

Certain other financial statement reclassifications have been made on
the transition to IFRS. An example includes the presentation of the
non-controlling interest in Adroit Investment Management Ltd. which has
been reclassified from other liabilities under Canadian GAAP to
non-controlling interests (presented in equity) under IFRS.

The impact arising from the changes above are detailed in the following
consolidated balance sheets, consolidated income statements and
consolidated statements of comprehensive income under the heading "(e)
Other Adjustments".

Reconciliation of Condensed Consolidated Balance Sheets

As at November 1, 2010 (Unaudited)

				IFRS Adjustments
				(a)		(b)		(c)		(d)		(e)
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
Assets
Cash resources, securities and securities under resale agreements		$	1,876,085	$	-	$	-	$	-	$	-	$	-	$	1,876,085
Loans			10,496,464		-		196,215		-		-		(17,982)		10,674,697
Other assets			329,142		7,839		(10,567)		-		-		4,532		330,946
Total Assets		$	12,701,691	$	7,839	$	185,648	$	-	$	-	$	(13,450)	$	12,881,728

Liabilities
Deposits		$	10,812,767	$	-	$	-	$	(105,000)	$	-	$	-	$	10,707,767
Other liabilities			425,881		17,835		(14,047)		-		-		(179)		429,490
Debt			315,000		-		202,006		-		-		-		517,006
Total Liabilities			11,553,648		17,835		187,959		(105,000)		-		(179)		11,654,263
Equity
	Preferred shares		209,750		-		-		-		-		-		209,750
	Common shares		279,352		268		-		-		-		-		279,620
	Retained earnings		614,710		(10,264)		(2,311)		-		(1,752)		(13,450)		586,933
	Share-based payment reserve		21,291		-		-		-		-		-		21,291
	Other reserves		22,940		-		-		-		1,752		-		24,692
Total Shareholders' Equity			1,148,043		(9,996)		(2,311)		-		-		(13,450)		1,122,286
	Non-controlling interest		-		-		-		105,000		-		179		105,179
Total Equity			1,148,043		(9,996)		(2,311)		105,000		-		(13,271)		1,227,465
Total Liabilities and Equity		$	12,701,691	$	7,839	$	185,648	$	-	$	-	$	(13,450)	$	12,881,728

As at January 31, 2011 (Unaudited)

				IFRS Adjustments
				(a)		(b)		(c)		(d)		(e)
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
Assets
Cash resources and securities		$	1,753,605	$	-	$	-	$	-	$	-	$	-	$	1,753,605
Loans			10,886,889		-		167,014		-		-		(17,982)		11,035,921
Other assets			305,723		7,839		(8,923)		-		-		4,532		309,171
Total Assets		$	12,946,217	$	7,839	$	158,091	$	-	$	-	$	(13,450)	$	13,098,697

Liabilities
Deposits		$	10,786,341	$	-	$	-	$	(105,000)	$	-	$	-	$	10,681,341
Other liabilities			404,652		20,351		(11,628)		-		-		(239)		413,136
Debt			545,000		-		171,812		-		-		-		716,812
Total Liabilities			11,735,993		20,351		160,184		(105,000)		-		(239)		11,811,289
Equity
	Preferred shares		209,750		-		-		-		-		-		209,750
	Common shares		323,340		268		-		-		-		-		323,608
	Retained earnings		638,007		(12,780)		(2,093)		-		(1,752)		(13,450)		607,932
	Share-based payment reserve		21,089		-		-		-		-		-		21,089
	Other reserves		18,038		-		-		-		1,752		-		19,790
Total Shareholders' Equity			1,210,224		(12,512)		(2,093)		-		-		(13,450)		1,182,169
	Non-controlling interest		-		-		-		105,000		-		239		105,239
Total Equity			1,210,224		(12,512)		(2,093)		105,000		-		(13,211)		1,287,408
Total Liabilities and Equity		$	12,946,217	$	7,839	$	158,091	$	-	$	-	$	(13,450)	$	13,098,697

As at October 31, 2011 (Unaudited)

				IFRS Adjustments
				(a)		(b)		(c)		(d)		(e)
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
Assets
Cash resources and securities		$	2,238,039	$	-	$	-	$	-	$	-	$	-	$	2,238,039
Loans			12,221,143		-		90,121		-		-		(17,982)		12,293,282
Other assets			312,853		7,839		(7,404)		-		-		4,532		317,820
Total Assets		$	14,772,035	$	7,839	$	82,717	$	-	$	-	$	(13,450)	$	14,849,141

Liabilities
Deposits		$	12,499,689	$	-	$	-	$	(105,000)	$	-	$	-	$	12,394,689
Other liabilities			433,780		30,140		(5,958)		-		-		(225)		457,737
Debt			545,000		-		89,877		-		-		-		634,877
Total Liabilities			13,478,469		30,140		83,919		(105,000)		-		(225)		13,487,303
Equity
	Preferred shares		209,750		-		-		-		-		-		209,750
	Common shares		408,014		268		-		-		-		-		408,282
	Retained earnings		650,028		(22,569)		(1,202)		-		(3,959)		(13,450)		608,848
	Share-based payment reserve		21,884		-		-		-		-		-		21,884
	Other reserves		3,890		-		-		-		3,959		-		7,849
Total Shareholders' Equity			1,293,566		(22,301)		(1,202)		-		-		(13,450)		1,256,613
	Non-controlling interest		-		-		-		105,000		-		225		105,225
Total Equity			1,293,566		(22,301)		(1,202)		105,000		-		(13,225)		1,361,838
Total Liabilities and Equity		$	14,772,035	$	7,839	$	82,717	$	-	$	-	$	(13,450)	$	14,849,141

Reconciliation of Condensed Consolidated Income Statements

For the year ended October 31, 2011 (Unaudited)

			IFRS Adjustments
			(a)		(b)		(c)		(d)		(e)
	Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
Net interest income	$	373,624	$	-	$	5,508	$	6,747	$	-	$	14,514	$	400,393
Provision for credit losses		22,179		-		(396)		-		-		-		21,783
Other income		106,331		(12,305)		(4,386)		-		(3,023)		(14,514)		72,103
Non-interest expenses		222,451		-		-		-		-		-		222,451
Income taxes		56,948		-		409		-		(816)		-		56,541
Non-controlling interest in subsidiary		228		-		-		-		-		(228)		-
Net income	$	178,149	$	(12,305)	$	1,109	$	6,747	$	(2,207)	$	228	$	171,721
Net income attributable to non-controlling interests		-		-		-		6,747		-		228		6,975
Net income attributable to shareholders of the Bank	$	178,149	$	(12,305)	$	1,109	$	-	$	(2,207)	$	-	$	164,746
Preferred share dividends		15,208		-		-		-		-		-		15,208
Net income available to common shareholders	$	162,941	$	(12,305)	$	1,109	$	-	$	(2,207)	$	-	$	149,538

For the three months ended January 31, 2011 (Unaudited)

			IFRS Adjustments
			(a)		(b)		(c)		(d)		(e)
	Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
	Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS

Net interest income	$	90,682	$	-	$	1,804	$	1,700	$	-	$	4,287	$	98,473
Provision for credit losses		6,216		-		34		-		-		-		6,250
Other income		28,421		(2,516)		(1,472)		-		-		(4,287)		20,146
Non-interest expenses		55,128		-		-		-		-		-		55,128
Income taxes		13,747		-		80		-		-		-		13,827
Non-controlling interest in subsidiary		60		-		-		-		-		(60)		-
Net income	$	43,952	$	(2,516)	$	218	$	1,700	$	-	$	60	$	43,414
Net income attributable to non-controlling interests		-		-		-		1,700		-		60		1,760
Net income attributable to shareholders of the Bank	$	43,952	$	(2,516)	$	218	$	-	$	-	$	-	$	41,654
Preferred share dividends		3,802		-		-		-		-		-		3,802
Net income available to common shareholders	$	40,150	$	(2,516)	$	218	$	-	$	-	$	-	$	37,852

For the three months ended October 31, 2011 (Unaudited)

			IFRS Adjustments
			(a)		(b)		(c)		(d)		(e)
	Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
	Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS

Net interest income	$	96,709	$	-	$	1,006	$	1,700	$	-	$	3,636	$	103,051
Provision for credit losses		5,521		-		(338)		-		-		-		5,183
Other income		24,452		(3,539)		(765)		-		(3,023)		(3,636)		13,489
Non-interest expenses		56,110		-		-		-		-		-		56,110
Income taxes		14,433		-		156		-		(816)		-		13,773
Non-controlling interest in subsidiary		51		-		-		-		-		(51)		-
Net income	$	45,046	$	(3,539)	$	423	$	1,700	$	(2,207)	$	51	$	41,474
Net income attributable to non-controlling interests		-		-		-		1,700		-		51		1,751
Net income attributable to shareholders of the Bank	$	45,046	$	(3,539)	$	423	$	-	$	(2,207)	$	-	$	39,723
Preferred share dividends		3,802		-		-		-		-		-		3,802
Net income available to common shareholders	$	41,244	$	(3,539)	$	423	$	-	$	(2,207)	$	-	$	35,921

Reconciliation of Consolidated Statements of Comprehensive Income

For the year ended October 31, 2011 (Unaudited)

				IFRS Adjustments
				(a)		(b)		(c)		(d)		(e)
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS

Net income		$	178,149	$	(12,305)	$	1,109	$	6,747	$	(2,207)	$	228	$	171,721
Other comprehensive income, net of tax
Available-for-sale securities
	Gains from change in fair value		(11,710)		-		-		-		-		-		(11,710)
	Reclassification to other income		(7,340)		-		-		-		2,207		-		(5,133)
Other comprehensive income for the period			(19,050)		-		-		-		2,207		-		(16,843)
Comprehensive income for the period		$	159,099	$	(12,305)	$	1,109	$	6,747	$	-	$	228	$	154,878

Comprehensive income for the year attributable to:
	Shareholders of the Bank	$	159,099	$	(12,305)	$	1,109	$	-	$	-	$	-	$	147,903
	Non-controlling interests		-		-		-		6,747		-		228		6,975
Comprehensive income for the period		$	159,099	$	(12,305)	$	1,109	$	6,747	$	-	$	228	$	154,878

For the quarter ended October 31, 2011 (Unaudited)

				IFRS Adjustments
				(a)		(b)		(c)		(d)		(e)
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS
		Canadian GAAP		Business Combinations		Derecognition		Consolidation		AFS Impairment		Other Adjustments		IFRS

Net income		$	45,046	$	(3,539)	$	423	$	1,700	$	(2,207)	$	51	$	41,474
Other comprehensive income, net of tax
Available-for-sale securities
	Gains from change in fair value		(8,693)		-		-		-		-		-		(8,693)
	Reclassification to other income		129		-		-		-		2,207		-		2,336
Other comprehensive income for the period			(8,564)		-		-		-		2,207		-		(6,357)
Comprehensive income for the period		$	36,482	$	(3,539)	$	423	$	1,700	$	-	$	51	$	35,117

Comprehensive income for the year attributable to:
	Shareholders of the Bank	$	36,482	$	(3,539)	$	423	$	-	$	-	$	-	$	33,366
	Non-controlling interests		-		-		-		1,700		-		51		1,751
Comprehensive income for the period		$	36,482	$	(3,539)	$	423	$	1,700	$	-	$	51	$	35,117

No transition adjustments to other comprehensive income were required
for the three months ended January 31, 2011.

Shareholder Information

Head Office

Canadian Western Bank & Trust

Suite 3000, Canadian Western Bank Place

10303 Jasper Avenue

Edmonton, AB T5J 3X6

Telephone: (780) 423-8888

Fax: (780) 423-8897

www.cwbankgroup.com

Subsidiary Offices

National Leasing Group Inc.

1525 Buffalo Place

Winnipeg, MB R3T 1L9

Toll-free: 1-800-665-1326

Toll-free fax: 1-866-408-0729

www.nationalleasing.com

Canadian Western Trust Company

Suite 600, 750 Cambie Street

Vancouver, BC V6B 0A2

Toll-free: 1-800-663-1124

Fax: (604) 669-6069

www.cwt.ca

Valiant Trust Company

Suite 310, 606 - 4^th Street S.W.

Calgary, AB T2P 1T1

Toll-free: 1-866-313-1872

Fax: (403) 233-2857

www.valianttrust.com

Canadian Direct Insurance Incorporated

Suite 600, 750 Cambie Street

Vancouver, BC V6B 0A2

Telephone: (604) 699-3678

Fax: (604) 699-3851

www.canadiandirect.com

Adroit Investment Management Ltd.

Suite 1250, Canadian Western Bank Place

10303 Jasper Avenue

Edmonton, AB T5J 3N6

Telephone: (780) 429-3500

Fax: (780) 429-9680

www.adroitinvestments.ca

Stock Exchange Listings

The Toronto Stock Exchange

Common Shares: CWB

Series 3 Preferred Shares: CWB.PR.A

Transfer Agent and Registrar

Valiant Trust Company

Suite 310, 606 - 4^th Street S.W.

Calgary, AB T2P 1T1

Telephone: (403) 233-2801

Fax: (403) 233-2857

Website: www.valianttrust.com

E-mail: inquiries@valianttrust.com

Eligible Dividends Designation

CWB designates all dividends for both common and preferred

shares paid to Canadian residents as "eligible dividends",

as defined in the Income Tax Act (Canada), unless otherwis e

noted.

Dividend Reinvestment Plan

CWB's dividend reinvestment plan allows common and

preferred shareholders to purchase additional common shares

by reinvesting their cash dividend without incurring

brokerage and commission fees. For information about

participation in the plan, please contact the Transfer Agent

and Registrar or visit www.cwbankgroup.com.

Investor Relations

For further financial information contact:

Investor & Public Relations

Canadian Western Bank

Telephone: (780) 441-3770

Toll-free: 1-800-836-1886

Fax: (780) 969-8326

E-mail: InvestorRelations@cwbank.com

Online Investor Information

Additional investor information including supplemental

financial information and corporate presentations are

available on CWB's website at www.cwbankgroup.com.

Quarterly Conference Call and Webcast

CWB's quarterly conference call and live audio webcast will

take place on March 8, 2012 at 3:00 p.m. ET.

The webcast will be archived on the Bank's website at

www.cwbankgroup.com for sixty days. A replay of the

conference call will be available until March 22, 2012

by dialing (416) 849-0833 or toll-free (855) 859-2056

and entering passcode 51521762.

For further information:

Larry M. Pollock
President and Chief Executive Officer
Canadian Western Bank
Phone: (780) 423-8888

Kirby Hill, CFA
Director, Investor and Public Relations
Canadian Western Bank
Phone: (780) 441-3770
Email:kirby.hill@cwbank.com

Canada Dividend Investor

Wednesday, March 7, 2012

CWB - <span class="simulate_din_font">CWB reports strong earnings and record quarterly revenues</span> (CAD 0.15)

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