Sterling Risk names new principal
Danny Sellers of Duluth has been named a principal at Sterling Risk Advisors, 2500 Cumberland Parkway SE in the Cumberland area. He has more than 20 years of experience specializing in risk management for construction, trucking and manufacturing companies.
Prior to joining Sterling Risk Advisors in 2012, he was senior vice president for J. Smith Lanier amp; Co., where he handled large, complex accounts, including large transportation accounts with both regional and long haul exposure. Earlier, he was executive vice president at Allied North America, where he produced and managed accounts including a major international manufacturing firm with $1 billion in sales.
He holds a Bachelor of Science degree in General Business from Georgia Southern University.His professional affiliations include Construction Financial Management Association, Georgia Utility Contractors Association and Georgia Health Care Association.
With a focus on giving back to his community, Sellers is a supporter of Compassion International, a Christian child advocacy ministry that sponsors children in need. Sterling Risk Advisors is a risk management and insurance brokerage firm serving the commercial, professional and personal needs of clients across a diverse spectrum of industries.
Cobb EMC launches new mobile application
Cobb Electric Membership Corporation recently launched a contemporary Web- and app-based platform that allows members to pay and manage their electric accounts through an online portal called SmartHub. This implementation allows residential members to pay by Visa, MasterCard or Discover with no credit card convenience fee.
This mobile tool for iPhone, iPad and Android devices allows members access to a mobile application that includes features such as the ability to pay bills remotely, monitor electricity use, view real-time payment posting/account updates and report outages.
Since the launch in early January, more than 60,000 members have logged into SmartHub to view their bill and energy usage. This increase in online traffic is a result of members taking advantage of the benefits of paying their bill, viewing their daily/hourly usage and having access to their account 24/7.
The SmartHub app is available on the iPhone App Store and in the Android Market. Members can simply search for SmartHub and download at no cost.
Cobb EMC, a not-for-profit electric cooperative, safely delivers electricity to more than 175,000 residential and commercial members in Cobb, Bartow, Cherokee, Fulton and Paulding counties. For more information, visit www.cobbemc.com.
KSU business school earns accreditation
The Michael J. Coles College of Business at Kennesaw State University, the second-largest business school in Georgia, once again earned accreditation from the leading global accrediting body for business schools.
The Coles College of Business maintained its accreditation with the Association to Advance Collegiate Schools of Business International after a quality review. Less than five percent of the worlds business schools have earned AACSB International accreditation.
The reaffirmation of accreditation by AACSB International comes after US World News and World Report named the Coles College of Business part-time MBA among the best in the country and CEO Magazine ranked the Executive MBA among the best in the US in its 2015 Global MBA Rankings edition.
To maintain its accreditation, the Coles College of Business must undergo a review by academic leaders of peer business schools every five years.
Kennesaw mayor elected vice chair
On Jan. 28, the Executive Committee of the Metro Atlanta Mayors Association elected Kennesaw Mayor Mark Mathews as its 2015-16 vice chairman.
MAMA, formed in 2003 to increase communications among cities in the metro Atlanta region, consists of mayors from the 70 cities in the 10-county metro area. The association, an affiliate of the Georgia Municipal Association, reaches across individual city boundaries to have a collective voice on issues that affect the entire region and cannot be effectively addressed by any one jurisdiction acting alone.
For more information, visit www.metroatlantamayors.org.
Cobb native named bank president
The Board of Directors of Community Bank of the South announced Sylvia D. Hamby was elected president of Community Bank of the South, headquartered at 3016 Atlanta Road in Smyrna.
Hamby, a Cobb County native, most recently served as the banks chief operating officer. She will have the distinction of being the only active female bank president in Cobb County.
Hamby expressed appreciation in the trust and confidence placed in her by the board and also stated, I am excited about the banks future. The bank is well-positioned to continue its growth, increase shareholder value, provide exceptional service and give back to our communities.
For more information, www.cbsouth.com.
Dicks Sporting Goods now hiring
Dicks Sporting Goods, which is now hiring, typically staffs its stores with about 50 full-time and part-time positions, including management and associate positions, according to a release from the company.
The new store is expected to open in spring 2015 at 4269 Roswell Road in the East Cobb Crossing shopping center. It will feature athletic and outdoor apparel, footwear and gear for team sports, fitness, camping, hunting and fishing.
Dicks Sporting Goods was founded in 1948 and is headquartered in Pittsburgh, Pennsylvania. As of November 3, 2014, the company operated more than 595 locations, including a store on Barrett Parkway in Kennesaw.
Interested applicants should visit dickssportinggoods.jobs.
United Community Banks Inc. hires CCO
United Community Banks Inc., which has several branches in Cobb County, announced that veteran credit manager Rob Edwards has joined the company as executive vice president and chief credit officer for it and subsidiary, United Community Bank. Edwards has more than 25 years in credit management.
Edwards is replacing David Shearrow, who is retiring, as chief credit officer. Edwards most recently served as senior vice president and executive credit officer at TD Bank. He also led the Credit Risk Analytics and Credit Policy groups where he was responsible for stress testing, the allowance for loan losses, and credit risk model development.
Prior to his role at TD Bank, Edwards served as chief credit officer for The South Financial Group. He has also held senior credit positions with Regions Financial Corporation and BBamp;T Corporation.
For more information, visit www.ucbi.com.
Moore Colson announces newIT audit and consulting director
Marietta-based accounting firm Moore Colson recently announced the promotion of Patrick Daniel to IT audit and consulting director in the firms Risk Advisory and Compliance Practice.
Patrick, who recently celebrated his 10th anniversary with Moore Colson, is responsible for leading the firms IT Auditing Services focusing on Sarbanes-Oxley initiatives, and compliance and security governance, for many of the firms largest clients. He also leads many of the firms SSAE 16 service organization audits and attestation engagements.
Prior to joining the firm in August 2004, he worked for the State of Georgia where he served as an information technology audit specialist. While working for the state, he performed information technology audits for some of the states largest agencies, including the Departments of Revenue, Education, Human Resources and the Office of Secretary of State.
Prior to working for the state, he worked as an independent software engineer consultant with IBM for six years, where he served in a number of roles and projects for one of the worlds largest apparel companies. He also performed analysis, design and development roles for a number of financial software companies, a major farm equipment manufacturer and a freight delivery company.
Daniel received a Bachelor of science in Computer Sciences from Kennesaw State University and holds Certified Information Systems Auditor, Certified Information Systems Security Professional and Certified in Risk and Information Systems Control certifications. He is an active member of the Atlanta Chapters of Information Systems Security Association and Information Systems Audit and Control Association.
Moore Colson, founded in 1981, is a full-service accounting and consulting firm named one of Americas Top 200 Largest CPA Firms in 2014 and Best of the Best Firms in 2013 and 2014 by IPA Magazine, and one of Atlantas Top Workplaces by the Atlanta Journal Constitution from 2011-2014.
For more information, call (770) 989-0028 or visit www.moorecolson.com.
Marketing Inspiration is a finalist for AMYs, ADDYs
Marketing Inspirations, 2727 Paces Ferry Road SE in the Cumberland area, has been selected as a finalist for four campaigns for the 2015 Atlanta Marketer of the Year Awards and received recognition as a finalist in the Atlanta American Advertising Awards.
The nominations for the AMYs were:
diams;Integrated Marketing Campaign (B2B): Spend Management Experts
diams;Web amp; Interactive Marketing (Social Media Campaign Company Revenue less $1 billion): Fox Theatres Biggest Fan
diams;Print Advertising: BBamp;T Atlanta Open Atlanta Magazine special section
diams;Web amp; Interactive Marketing (Social Media Campaign Company Revenue less $1 billion): THORLO #SmileyFeet
The nomination for the ADDYs was:
diams;Vehicle Graphic Advertising: BBamp;T Atlanta Open Fuzzy Lexus
For 58 years, the AMY Awards, presented by AMA Atlanta, have celebrated and rewarded companies that craft innovative strategies, unforgettable creative and produce outstanding results. Winners will be announced during the annual awards ceremony Thursday, March 12 at the Fox Theatre.
Each year, the Atlanta Ad Club initiates the first of a three-tier, national competition, by rewarding creative spirit of excellence in the art of advertising within the local Atlanta chapter. Local ADDYs were presented during the Atlanta Ad Club 2015 American Advertising Awards Feb. 19 at The Tabernacle.
These nominations are a result of our inspired, collaborative team working together towards the shared goal of exceeding expectations and having great clients that support our recommendations for innovation, said Barbara King, president of MI. Were thrilled to be recognized alongside Atlantas best and brightest in marketing and advertising.
For more information, visit www.marketinginspirations.com/.
Puckett EMS opens training center
Austell-based Puckett EMS, a provider of emergency and non-emergency ambulance services, announced the opening of its newest state-of-the-art Training Center off the East-West Connector in Austell. Puckett EMS will also offer the Advanced Emergency Medical Technician Course.
AEMT is a comprehensive program consisting of both classroom, skills lab, hospital observation and ambulance observation components. The course has been approved through the Georgia State Office of EMS and Trauma. Classes will be every Tuesday and Thursday evenings and the last Saturday of every month.
Upon successfully completion, students will have the skills and knowledge to surpass both the cognitive and psychomotor exams required by the National Registry of Emergency Medical Technicians. All student clinical ride-alongs will be completed on one of the companys state-of-the-art 911-Advanced Life Support Ambulances conducted by the top medical technicians in the region.
Crowder Realty announces annual awards
Crowder Realty, 1459 Field Park Circle in Marietta, announced it recently held its Annual Awards Meeting to recognize the outstanding service of its realtors.
This year, the Rookie of the Year Award was given to Tom Jones of Decatur, who specializes in HUD homes and first-time homebuyers.
The Realtor of the Year in Land and Commercial Sales was given to Dean Vickers, who works throughout metro Atlanta and specializes in Strategic Acquisitions and Dispositions.
The Realtor of the Year in Sales was given to Craig Williams, who specializes in residential properties and also investment properties leading the company in sales for 2014.
The Realtor of the Year in Volume was Mikel Crowley, who also specializes in residential sales and serves as the senior marketing consultant for Crowder Realty.
The Charlie Crowder Award was presented to Brian McNair for outstanding community service and company spirit. McNair is very active in his church, First United Methodist Church of Marietta, and also works with MUST Ministries and Habitat for Humanity.
Ultimate Escape Games opens
The Ultimate Escape Game Atlanta, an innovative, brain-teasing labyrinth of clues and puzzles aimed to bring out participants inner detective in a live room escape adventure, is now open at 3200 Cobb Galleria Parkway, Suite 150 in the Cumberland area. For one hour, teams must work together to crack codes, find clues and solve puzzles in pursuit of the ultimate goal: to find a four-digit pin and escape the room.
The Ultimate Escape Game has three themed rooms, The Vault, Hackers and Atlanta, which cater to all levels of play. The various scenarios include finding a secret cola recipe, stealing a priceless piece of art and hacking into the hideout of a notorious cyber terrorist organization.
The family-friendly entertainment venue accommodates tourists, locals and convention attendees to corporate groups for team building activities. Managers associated with team building events will have the option to either participate in the games or watch their employees from the Ultimate Escape Games control room to examine their teams dynamics in a new, high-energy environment.
Due to the challenging level of the games, the Ultimate Escape Game recommends players be at least 14 years old to participate. Tickets are $28 and can be purchased online at atlanta.ultimateescapegame.com/booking.
For more information about team building discounts, please call (770) 693-2318.
Fifth Third names senior manager
Fifth Third Bank, which has several locations in the Marietta and Kennesaw area, announced Anne Cross has joined the banks Georgia affiliate as vice president and senior commercial relationship manager, focusing on middle market commercial and industrial companies with annual revenues up to $500 million. Cross has 31 years of experience in the financial industry and was previously a senior relationship manager for Wells Fargo in Atlanta.
She is an Atlanta resident and serves on several community/civic boards. She is a board member with the Center for Puppetry Arts and the HAVE Foundation. She is also an advisory grant panelist with the Atlanta Office of Cultural Affairs, Arts Leadership of Metro Atlanta Class of 2010, Leadership DeKalb Class of 2004, past president of the Wyndham Hill HOA and is a deacon, choir member and personnel chair at Wieuca Road Baptist Church.
Cross received a Bachelor of Science degree in business administration/finance from Florida Southern College.
Chiropractor offers community workshop for relieving back pain
Blumsack Family Chiropractic, 3770 Due West Road, Suite 200 in Marietta, will have a free community workshop with Carrie Padgett on March 7 at 9:30 am
Participants can learn how to relieve aches and pains on their own at home by joining Bodywork By Carrie for a free Active Isolated Stretching class. Learn to gently loosen muscles, increase energy and recover from injury. The class is safe for all ages as well as pregnant women, even in the first trimester.
Space is limited, so make reservations by March 6 at (770) 362-6430.
For more information, visit www.blumsackfamilychiropractic.com.
New West Cobb homes offered by Fortress
Fortress Builders announced it is currently offering new homes at three West Cobb communities.
Homebuyers can choose from three inventory homes priced from $339,900 at the small 12 single-family home enclave of Church Hill off of Mars Hill Church Road in Acworth. Features include classic brick exteriors, gourmet kitchens complete with granite countertops, stainless steel appliances and oversized cabinets.
Brookstone Manor, an active adult community that is part of the popular Brookstone Country Club in Acworth, has four ranch condominium homes available from the $230s. Amenities include a golf course, swimming pools, tennis facilities and a clubhouse.
Bruster Manor, between Powder Springs and Hiram in west Cobb, has four inventory homes priced from $289,990. Features include spacious backyards, hardwood flooring and kitchens with granite countertops, stained cabinets and tile backsplashes. Children in the community will attend Cobb County schools.
Fortress Builders is also offering a limited-time buyers incentive at all three communities. Buyers who purchase a standing inventory home will receive free blinds and a refrigerator.
For more information, visit www.FortressBuilders.com.
And welcome to TD Bank Groups First Quarter 2015 Investor Presentation. My name is Rudy Sankovic and I am the Head of Investor Relations for the Bank. We will begin todays presentation with remarks from Bharat Masrani, our CEO; after which Colleen Johnston, the Banks CFO will present our first quarter operating results. Mark Chauvin, our Chief Risk Officer, will then offer comments on credit quality; after which we will entertain questions from those present and from pre-qualified analysts and investors on the phone.
Also present today to answer your questions are Tim Hockey, Group Head - Canadian Banking, Auto Finance and Wealth Management; Mike Pedersen, Group Head - US Banking; Bob Dorrance, Group Head - Wholesale Banking; Riaz Ahmed, Group Head - Insurance, Credit Cards and Enterprise Strategy. Riaz is also responsible for the capital and treasury activities at the Bank.
Please turn to Slide two. At this time, I would like to caution our listeners that this presentation contains forward-looking statements. There are risks that actual results could differ materially from what is discussed, and that certain material factors or assumptions were applied in making these forward-looking statements. Any forward-looking statements contained in this presentation represent the views of management and are presented for the purpose of assisting the Banks shareholders and analysts in understanding the Banks financial position, objectives and priorities, and anticipated financial performance. Forward-looking statements may not be appropriate for other purposes. Id also like to remind listeners that the Bank uses non-GAAP financial measures to arrive at adjusted results to assess each of our businesses and to measure overall Bank performance. The Bank believes that adjusted results provide readers with a better understanding of how management views the Banks performance. Bharat will be referring to adjusted results in his remarks. Additional information on items of note, the Banks reported results and factors and assumptions related to forward-looking information are all available in our Q1 2015 report to shareholders.
With that, let me turn the presentation over to Bharat.
Thank you, Rudy, and good afternoon. I want to comment briefly on Q1 before I turn it over to Colleen for a more detailed review of our results. Overall, I am very pleased with the quarter, earnings per share were up a solid 6% year-over-year with all of our businesses performing well. Today, we announced a $0.04 increase to our dividend up a healthy 9% reflecting the Board's confidence in the stability and strength of TD's long-term earnings power. This increase should move our payout ratio closer to the midpoint of our 40% to 50% target range. On the capital front, our common equity Tier 1 capital position remains strong at 9.5%.
Lets take a closer look at our financial performance. TD's earnings of $2.1 billion speak to the strength of our business model, diverse, business mix and organic growth engines which were evident in the healthy loan and deposit growth we delivered on both sides of the border. The strength in both credit and the US dollar were also helpful contributors to our financial performance.
Our Canadian retail business delivered year-over-year earnings growth of 8%. This result was fuelled by good volume growth in our personal, commercial and wealth businesses in fact just recently our TD Mutual Funds exceeded a $100 billion in AUMs. We also benefitted from great performances in credit cards and insurance. Strong results in our US retail segment led to a year-over-year increase in earnings of 15%.
Good organic growth in loans and deposits, strong credit quality, good expense management and improved margins versus the fourth quarter contributed to an impressive start to 2015.
However, we continue to expect modest growth in the US for the full year. We expect credit to normalize, our NIM for the full year will be down compared to 2014 and we anticipate lower securities gains. Our wholesale bank had a solid quarter with good trading results in a volatile market offset by lower fee based revenues.
Let me now turn to some of our major focus areas for this year. TD strategy is and has been about growth. We have delivered on this goal in the past and we intend to do so in the future. This quarter demonstrated the strength of our growth engines, but major external forces like technology innovation, regulatory changes and the sustained low rate environment impact our business and industry. We are evolving our strategies to add that to these changes. Let me share a few examples.
We are making great strides in advancing our digital and mobile capabilities including modernizing our technology infrastructure to drive agility and improve efficiency. Equally important, these efforts will better serve our customer's needs across all of the TD's distribution networks. We continue to extend our service and convenience model into our digital channels. Mobile deposit, remote deposit capture and image enabled ATMs on both sides of the border are great examples.
We are also piloting different branch and store formats working to both optimize our retail distribution network and adapt to changing customer preferences. Additionally we are enhancing our products to better meet the needs of our customers. The recent launch and success of our new [indiscernible] product in Canada is a great example. In the US we are very focused on increasing our customer share of wallet by proactively offering new products and services. All these initiatives will help TD to be more responsive to customer's evolving needs.
We are also adapting to a world where many new competitors are unencumbered by legacy systems and using their speed to compete and win. As such we are harder to become fitter and faster organization. Our productivity focus is an important element of this initiative. I said previously that we would redouble our efforts to increase efficiency and streamline our cost base. Well I am satisfied with our expense performance so far, we know we have to do more and we are.
We continuously review our Canadian and US retail distribution networks to ensure our branch and store locations are optimized. In last year we reviewed some of our corporate functions. Given our significant growth over the past decade including integrating our acquisitions we have expanded these reviews across the organization. They will take place over the balance of the year.
In particular we are focusing on streamlining our executive and corporate management structures outside of our client facing areas. We are working hard at modernizing our processes and infrastructure for better efficiency and effectiveness. Initiatives range from digitizing processes with a view to eliminate duplication to leveraging our North American platform to drive cost savings.
And finally we are adding more discipline to our expenses processes and practices with particular focus on all discretionary spending big and small. This is simply a reality of today's slower growth world. All these initiatives are being carried out in a systematic and a thoughtful way, the TD way. We want to enhance our ability to compete and win without sacrificing long-term growth prospects for short-term gains. It will take some time before we see a meaningful impact to our expense base but we expect to see an improvement in our efficiency in the medium term.
Looking ahead a number of economic headwinds will continue to challenge the industry in 2015. I will talk about two that are top of mind with just about everybody, oil prices and interest rates. The Bank of Canada has said the decline in oil prices in unambiguously negative for the Canadian economy. We agree, however the impact will be uneven. Oil producing provinces will bear the brunt of the drop while others including Ontario will likely benefit from a weaker dollar and stronger export demand.
From a credit perspective we believe our direct exposure to oil and gas producers is manageable. We are not seeing any signs of deterioration though it is early days. From a business perspective we believe TD is relatively well placed given our higher concentration on business in anterior.
In the US the drop in oil prices is equal to a longer waited fiscal stimulus, leaving more money in the hands of consumers. Lower energy prices are likely to be a positive for the US which is already in the midst of recovery. Again I think TD is well positioned to benefit from an improving US economy particularly in our markets along the eastern seaboard where oil prices would help to drive future growth.
On the interest rate front during the quarter we saw a flattening of a yield curve and material drop in both short and long rates. The 30 day BA rate dropped by 27 basis points and the five year swap rate by 84 basis points. The impact of these declines will place continued pressure on our margins in Canada.
Overall 2015 will continue to be a tough and uncertain environment and increase regulatory expectations and intense competition on both sides of the border. However the fundamentals of our business remain strong and Im confident in the resilience of our model.
The Canadian retail business continues to deliver good results and is well positioned for future growth. The US franchise continues to deliver peer leading loan growth and will further benefit from our exposure to a robust US recovery. Our wholesale business continues to grow by extending his franchise model into the US to take advantage of a strong retail and commercial presence. To conclude, I am confident that our strategy, brand and great people will continue to create value for our customers, grow our franchise and build an even better bank. Thank you very much and now I'll pass it on to Colleen.
Thanks, Bharat, and good afternoon everyone. Let me take you through our results. Please turn to Slide 4.
Turning to Q1, we delivered adjusted EPS of $1.12, up 6% year-over-year. The quarter reflected strong growth in our retail businesses with record results on both sides of the border, solid wholesale performance and a higher corporate segment loss. The quarter benefitted from continued credit favorability and a strong US dollar. Adjusted total revenue increased 4% year-over-year or 2% excluding FX led by strong loan deposit and wealth asset growth, the addition of Aeroplan and better insurance performance. The strong growth this quarter was partially offset by margin compression reduced security gains and lower corporate segment revenue.
Adjusted expense growth was 7% year-over-year or 35 excluding FX, half of this quarter's expense growth was due to business initiatives including regulatory projects. The remaining expense growth was related to base expenses partly offset by productivity savings. As Bharat mentioned, we announced a $0.04 dividend increase this quarter, up 9%. Overall, a solid result for the Bank this quarter.
Please turn to Slide 5. This slide presents our reported and adjusted earnings this quarter with a difference due to one item of note which you've seen before. Please turn to Slide 6.
Canadian retail delivered a record quarter with adjusted net income of 1.4 billion, up 8% year-over-year. The increase was driven by continued good loan, deposit and wealth asset growth, good credit management and strong growth in insurance and credit card earnings including the fourth quarter impact of Aeroplan. Loan and deposit growth was good this quarter, total loan growth was 6% year-over-year with real estate secured lending volume up by 4% and business lending growth up a strong 9%.
Card growth also remained strong at 9%, driven by Aeroplan while auto lending grew 15%. Deposits increased by 5% due to strong growth in core checking and savings accounts, up 9%, while business deposits were up 8%. Margin was down 4 basis points sequentially, primarily due to competitive pricing a decline in refinancing revenue and the low rate environment. We expect margins to trend down slightly for the balance of the year reflecting the impact of the continued low rate environment.
Credit performance continues to be favorable with the quarter also benefitting from a debt sale. PCL and personal banking was down 29 million, business banking PCL decreased 11 million, mainly driven by higher recoveries. Adjusted expenses were up 8% year-over-year primarily due to higher employee-related cost, including revenue based variable expenses and growth initiatives. These increases were partially offset by productivity gains. Overall, a great start to the year for Canadian Retail.
Please turn to Slide 7. US retail, excluding TD Ameritrade had earnings of US 457 million, up 15% year-over-year. Results for the quarter reflected strong organic growth, favorable credit, and good expense management partially offset by margin compression and lower security gains. Revenue decreased by 1% year-over-year, as strong volume and deposit growth was offset by lower gains on sales of securities, lower target revenues and lower margins partially driven by competition. Excluding the decline in security gains and lower target revenue, US retail revenue rose 2% year-over-year. Targets contribution to earnings was relatively consistent year-over-year, the lower target revenues were largely driven by an accounting reclassification.
Average loans were up 9% year-over-year with a 3% increase in personal loans and a 15% increase in business loans. Average deposits increased by 5%. Margin increased 6 basis points quarter-over-quarter, driven primarily by an increase in deposit margins as a result of treasury actions partially offset by loan margin compression. We are forecasting some variability in margins over the course of the year, but we expect the full year margin to be roughly at the same level as Q4 of 2014. PCL decreased 31% due primarily to the lower losses in auto lending and real estate secured lending.
Expenses were down 3% versus last year. The decrease was driven by strong cost control, a positive pension item and lower target revenue share. Earnings from our ownership stake in TD Ameritrade in US dollars were up 22% year-over-year due mainly to increased TD Ameritrade earnings which rose 10% versus last year; all-in, a strong performance in the US
Please turn to Slide 8. Net income for wholesale was 192 million down 17% compared to a strong first quarter last year. Revenue was down 1% year-over-year as strong equities and FX performance was offset by lower fixed income trading. Non-interest expenses were up 5% drive by higher initiatives spent and the impact of foreign exchange. ROE this quarter was 13% reflecting higher allocated capital to the segment and foreign exchange.
Please turn to Slide 9. The corporate segment posted an adjusted loss of 143 million in the quarter compared to a loss of 38 million in the same period last year. The elevated loss was a result of prior year gain on sale of TD Ameritrade shares of 38 million, the impact of treasury activities on funding mix including lower preferred share recoveries and lower favorable tax items. Compared to the prior quarter adjusted net income improved 22 million.
Please turn to Slide 10, our Basel III common equity Tier 1 ratio was 9.5% in the first quarter versus 9.4% in the previous quarter. The increase reflects solid organic capital generation partially offset by actuarial losses on employee benefit plans due to the decline in long-term interest rates. Overall, we continue to remain well positioned for the evolving regulatory and capital environment.
With that, let me turn it over Mark.
Thank you, Colleen, and good afternoon everyone. Please turn to Slide 11, strong credit performance continued across all portfolios during the quarter. Provision for credit loss rates are at cyclically low levels with new impaired formations and gross impaired loan remaining stable quarter-over-quarter when adjusted for the weakening in the Canadian dollar.
The provision for credit loss rate decreased to 29 basis points in the quarter, down 4 basis points from Q4 and 11 basis points year-over-year. With respect to the oil and gas sector, a series of stress tests were completed during the quarter to determine the potential impact of sustained low oil prices on the Canadian and wholesale business segments. The test indicated the sustained low oil prices are not expected to have a significant impact on the bank for the following reasons.
First, lending within the oil and gas industry is governed by disciplined underwriting standards based on strong collateral positions.
Second, unsecured consumer credit exposure to the regions most impacted is less than 2% of the bank's total Canadian consumer credit exposure.
Third, the bank's higher concentration in Ontario.
And lastly deposit impact of low oil prices on our Ontario and US businesses. As result, I don't believe the sustained low oil prices represent a material risk to the bank.
Looking forward I am satisfied that credit quality across the portfolio should remain strong over the balance of the year based on current economic forecast.
Now, Ill turn the presentation back to Rudy.
Thank you, Mark. Well now open it up for questions. To give everyone a chance to participate, please keep to one question and re-queue if there is time. For those participating in person, can I ask you to identify your name and firm before asking your question? Before ending the call today Ill ask Bharat to offer some final remarks. So why dont we get started in the room. John, you're the only guy in the room.
According to the state-run Shanghai Securities News publication, Ant Financials revenue rose by an outstanding 92 percent to reach 10.2 billion yuan last year, equating to a 2.6-billion-yuan net profit sum and a 26-percent margin.
Alipay forms the crux of Ant Financials earning power, representing over 70 percent of its operating income, while about a third of its revenue comes from a 30-percent stake in MYBank (a private-investment bank that received regulatory approval in September) and relatively minor financial operations, such as small loans and credit management businesses.
The immense value of Alipay, which is presently Chinas most widely used online payment platform, means that Ant Financial is valued at between $35 billion and $40 billion.
While representatives from Alibaba, Ant Financial, and financial advisor China International Capital Corp. (CICC) remained tight-lipped about the status of the IPO proceedings, a piece in Caixin magazine reported that Chinas state-backed social security fund, the Postal Savings Bank of China and CDB Capital, are in the process of negotiating stakes of 5 percent, 3 percent and 3 percent, respectively.
According to Shanghai Security News, Ant Financial is seeking to generate an estimated $4-billion private share-placement amount for a 2017 domestic IPO.
Meanwhile, Ma has indicated to the media that he is uncertain about where the IPO will be held.
Gold Fields (NYSE: GFI) released their 2014 results earlier this month with some positives being overshadowed by issues at their South Deep mine. While Gold Fields managed to generate a substantial amount of cash, pay down debt and reduce costs, negative developments at South Deep appear to be front and center for the time being and are holding the stock back.Fourth Quarter and Year End Results
Gold Fields produced 556,000 ounces of gold in the fourth quarter and 2.2 million ounces for 2014, which was an increase of 10% over 2013. Adjusted earnings for the fourth quarter came in at $17 million compared to $14 million for the fourth quarter last year. For the year, adjusted earnings increased from $58 million in 2013 to $85 million in 2014. Gold Fields generated $54 million in cash flow from operating activities in the fourth quarter which marked the 6th consecutive quarter that Gold Fields has generated positive cash flow from operating activities, bringing their yearly cash flow total to $235 million despite 10% lower gold prices. Their fourth quarter 9% free cash flow margin was good considering the lower gold prices, but is a decrease from the 18% FCF margin reported in the second quarter and the 12% FCF margin reported last quarter. Still, in a gold price environment in which many miners are cash flow negative, Gold Fields is doing a good job in this area.
In the fourth quarter, Gold Fields managed to reduce net debt by another $45 million, bringing the yearly reduction total to $282 million. Total net debt stands at $1.45 billion which is still ugly, but is an impressive 16% lower than net debt of $1.74 billion last year. The net debt to EBITDA ratio now stands at 1.3:1 and net debt as a percentage of enterprise value decreased from 41% at the end of 2013 to 29% at the end of this year. With Gold Fields generating substantial cash from operations, I believe they are in a good position to continue to pay down net debt.
Gold Fields is guiding for production in 2015 of 2.2 million ounces which is in line with the 2.2 million ounces produced in 2014. All-in sustaining costs are forecasted to be $1,055 an ounce, which is also in line with 2014 AISC, which came in at $1,053 for the year. With no production increase for 2015, it is a bit disappointing that Gold Fields is not projecting to lower AISC further. It would be nice to see them come in under $1,000 per ounce which would be closer to the costs of other gold majors and would further increase cash flow and earnings.Problems at South Deep Persist
While Gold Fields enjoyed a strong 2014 on the cash flow front, shares were hammered after year end results due to issues that were highlighted at South Deep. Previously, Gold Fields had stated that they expected South Deep to be cash flow breakeven by mid 2015. Now, Gold Fields is stating that they forecast South Deep to be in a breakeven position in 2016. This was very discouraging for investors to hear as there have been numerous issues with South Deep in the past and South Deep is Gold Fields most important mine. The most concerning issue highlighted by management is a lack of skills in mechanized mining practices in South Africa. Gold Fields has stated that they are facing competition with other miners for these limited skills. This basically means that currently Gold Fields does not have the expertise to optimize South Deep which begs the question, if they dont have the expertise now, where is that expertise going to come from?
Gold Fields undertook a ground support remediation program at South Deep in 2014, which cost the mine significantly in ounces produced, with a 34% reduction from 2013. Gold Fields has stated that in light of all the issues at South Deep that they have decided to take a step back to get the basics right and set the foundation to unlock the long-term value inherent in the asset. Not exactly a statement that inspires investor confidence. Despite this, management has stated that they retain confidence in the ore body and the infrastructure at South Deep. To be fair to management, South Deep is the worlds second largest gold deposit and has an estimated 70 year life which invariably means there will be many hiccups along the way bringing a mine of this size to its full potential. I do credit management for their transparency as they have been forthcoming about their struggles at South Deep and have not tried to sugar-coat their problems. It will be important for investors to watch developments at South Deep closely as they will likely have a significant impact on Gold Fields stock price.
For the fourth quarter, AISC at South Deep were $1,640 an ounce which was an improvement over third quarter AISC which were $1,790 an ounce. For 2015, Gold Fields is guiding for AISC at South Deep of $1,400 an ounce which is still high but will be a big improvement if they can meet guidance. The real key for South Deep going forward will be for management to hire and train the skilled personnel required to operate the mine. Further delays on reaching the new break even target of 2016 will likely have a negative effect on the share price; however, any positive news in this regard could send shares much higher.