Desjardins Group posts drop in profitability for 2008

Deposit institutions Organization

Montréal – The Autorité des marchés financiers (AMF) has released the 2008 report on financial services cooperatives, tabled today in the Québec National Assembly by Minister of Finance Raymond Bachand.

The report notes that the Desjardins entities Combined data include data for the Group (Basel I Capital Accord) based on the capital adequacy requirements for financial services cooperatives, after elimination of balances and transactions among the Group’s entities. The main entities are the Fédération des caisses Desjardins du Québec, credit unions in Québec, the Caisse centrale Desjardins, MM Trust, MM Trust II, Capital Desjardins inc., Fonds de sécurité Desjardins, Desjardins Credit Unions, Transit Desjardins inc., Desjardins Société financière, Desjardins Gestion d’actifs, Location Desjardins, 9186-4108 Québec inc., 9186-4116 Québec inc., 9186-4132 Québec inc., 9186-3027 Québec inc., 9186-8034 Québec inc., PCAACO Mère, DGAG Holding and Stratégie alternative (DGAM). reported combined surplus earnings before patronage refunds of $62.7 million, compared with $1.1 billion in 2007. This lower surplus was primarily due to losses incurred in the securities portfolio. Despite this decline in profitability, the total capital ratio of the Fédération des caisses Desjardins du Québec was 12.8% in 2008, compared with 13.6% in 2007.

The total combined assets of the Desjardins entities were up 9% to $122.1 billion as at December 31, 2008, compared with growth of 10% the previous year. This was primarily due to an increase in loans.

The report also indicates that, as at December 31, 2008, 492 credit unions in Québec were affiliated with the Fédération des caisses Desjardins du Québec. The Caisse des Mutuellistes Épargne et Crédit was the only independent credit union.

The 2008 annual report on financial services cooperatives is available (in French only) on the AMF website, under the heading Publications/Documents regarding the AMF/AMF annual reports.

The Autorité des marchés financiers is the regulatory and oversight body for Québec's financial sector.

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