Canadian Western Bank (TSX:CWB) is an Edmonton-based regional bank. Investors may have had their eyes on the Big Six banks over the past year, but this regional bank had also been a top performer. The bank has bolstered its position in eastern Canada, but its business is still largely reliant in the western part of the country. That said, Canadian Western has lost momentum in a turbulent 2022. Its shares have dropped 12% in 2022 as of late afternoon trading on April 27.
The bank released its first quarter 2022 results on February 25. Total revenue rose 9% from the previous year to $266 million. Canadian Western was bolstered by promising credit and deposit growth in the first quarter. Branch-raised deposits climbed 12% year-over-year to $19.7 billion. Meanwhile, it delivered loan growth of 10% in Ontario and 9% overall to $33.4 billion.
Domestic banks are set to face challenges as policymakers pursue rate tightening. The Bank of Canada (BoC) moved to hike interest rates by 50-basis points earlier this month. This represented the largest single-day rate hike in over two decades. Rate tightening will apply more pressure on borrowers, but profit margins at top banks should improve.
Shares of this bank stock currently possess a very favourable price-to-earnings ratio of 8.4. Moreover, Canadian Western Bank last had an RSI of 24. That puts this bank stock in technically oversold territory at the time of this writing. This bank stock also offers a quarterly dividend of $0.30 per share, which represents a 3.7% yield.
