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Vote to merge with Outlook Financial
August 3, 2021
9:00 am
BestBankerEver
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Beware...while Implicity is good......there is a vote to merge with Outlook Financial. I see Outlook Financial as being the new lead of the 2. And my experience with Outlook Financial is dim (because I don't bank there any more).....40% of the time they screwed up my GIC orders.

August 3, 2021
11:47 am
topgun
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I found them excellent. I use the online process. It has worked well for me. Assiniboine is merging with Entegra Credit Union. They are the parent companies.

Have a Great Day

August 5, 2021
11:06 am
AltaRed
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Assiniboine is in the driver's seat here with a far larger asset base...so it is really the other way around, i.e. Entegra being bought by Assiniboine.

Bulk up or become irrelevant. More of these to occur in coming years.

August 5, 2021
12:47 pm
Loonie
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Just wondering, do you actually do any significant business with CUs, AltaRed? It seems to me you are extrapolating from the bank model.

August 5, 2021
7:49 pm
Norman1
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The proposed amalgamation is far from a merger of equals.

According to the Winnipeg Free Press:

  • Assiniboine Credit Union has 125,000+ members, 16 branches, 450 employees, and $5.45 billion in assets at Dec. 31, 2020.
  • Entegra Credit Union has 16,000+ members, four branches, 75 employees, and $711 million in assets at Dec. 31, 2020.

Assiniboine CU members will have 88%+ of the combined 141,000+ member votes and $6.2 billion total assets.

If approved, the merged credit unions will continue on January 1, 2022, as Assiniboine Credit Union.

August 5, 2021
8:24 pm
AltaRed
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Loonie said
Just wondering, do you actually do any significant business with CUs, AltaRed? It seems to me you are extrapolating from the bank model.  

I no longer have any personal business with CUs but the business model applies as importantly, and perhaps more so, with CUs than with banks that are mostly associated with larger entities, e.g. Home Capital Group, Equitable Group, Manulife, Motive, etc. with customer base spread over multiple regions, almost nationally. HCG is one of the smaller ones and has about $20B in assets, and would rate 4th in assets if a CU. https://www.desjardins.com/ressources/pdf/f05-o00107-ccua-top100.pdf One could argue only the top 10, and at most the top 20 in that list can survive on their own and be competitive long term.

The few small CUs I know something about back in Alberta have pretty amateur executives and management, inexperienced (amateur) Boards, and who knows what for business controls and risk management. Membership doesn't always have the collective expertise to know better either. They are like amateur condo boards.

If it sounds like I am denigrating 'some' CUs, that is not the intention. It's just a fact of life that many of them don't have the resources or size to serve their members well. Members should be pushing their 'regional CUs' to consolidate for a variety of common sense reasons.

In the BC Interior, I wouldn't touch #24, #38 and #48. They need to get their shite together like Prospera did and merge, maybe taking one or more of #14 and #23 on the coast with them to spread loan risk across disparate regions.

Point being, #24, #38 and #48, all within ~200km of each other will lose ground on their own and still may too close regionally.

August 6, 2021
12:23 am
Loonie
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I agree with most of what you say AltaRed, but there are lots of other factors you haven't mentioned which run counter to your conclusions.

While some small CUs are run by what you call amateurs, this doesn't mean they aren't doing a good job. They have in many cases been run this way for decades quite successfully. Pretty well all CUs were founded by "amateurs". A prudent person seems to be able to learn what they need to know, and there are courses that many of them take which teach them how to be a responsible board member, including those leading to certification by the Institute of Corporate Directors. Banks, even large ones run by professionals, have sometimes been brought to their knees by poor decision-making. They seemed oddly incapable of foreseeing the financial meltdown of 2008, for example, which I and some of my friends could see coming even though we are by no means financial professionals. Financial professionals placed their clients' money with Bernie Madoff, having chosen not to look very hard at his peculiar claims of success and failing to verify his trades.
Further. all CUs are subject to regulatory oversight and other criteria in order to maintain their deposit insurance.

I usually do vote in board elections and am often dismayed to find that in the larger CUs, every candidate is some kind of financial professional or entrepreneur. I don't know any of them and there is no procedure by which one can contact them to ask them a question. Meridian's board recently effectively fired the CEO but I have no idea of the real reason - despite his many years of service and a vague memo to members from the Chair. Such boards could use a dose of "real" everyday members with their feet on the ground, common sense and the ability to ask good questions. The ideal board, in my view, has a mix of both, not all cut from the same cloth.

August 6, 2021
4:56 am
canadian.100
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I have dealt with a number of CUs and I agree with Alta Red that there is an "amateurish" tone and approach in the way some are governed and in the way they operate.
Reading all the posts in regard to Pace CU and the way they serviced and advised clients - for sure, a very amateurish and unprofessional operation.
While banks are not perfect, it is those amateurish vibes at CUs which I have picked up more quickly in my own experiences dealing with CUs and I am referring not to my dealings with just the front line "associate" but with the Supervisor and Manager levels.

August 6, 2021
7:33 am
AltaRed
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Loonie, there is no need to bring wealth management (portfolio management) types like Bernie Madoff into the conversation because it is not remotely relevant. We are discussing retail banking and CUs, not wealth management and capital markets. I agree a lot of US and European banks did poorly (or collapsed) in the financial crisis, primarily triggered by CDOs and the like by investment banks. Retail banking was not their downfall.

That is a world removed from retail banking, personal loans and mortgages and the business controls, systems and risk management of that part of bank business. Smaller CUs simply can't compete with the business controls, systems and offerings such as e-transfers, bill payments, credit cards and worldwide phone access associated with larger banks and CUs. Imagine trying to call a small CU from Nepal because your credit card is frozen.

Many of the CUs see the writing on the wall for the need to not be left behind in the world of online banking and product offerings and that is why they are consolidating. This process will continue unabated for years to come. I only entered this conversation to 'ring the bell' on what appeared to be resistance and horror from an individual with Implicity who appeared to be against being bought out. That individual really should be looking at the bigger picture and running flat out to support that merger.

P.S. In my research yesterday, I discovered that one of the small CUs I was familiar with (in my previous post) recently consolidated with a much larger CU within the past year. It was the only thing they could do to stay relevant and competitive. Smart of them!

August 6, 2021
11:45 am
Loonie
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Yes, I knew you'd object when I mentioned Bernie, but he did borrow from big banks when he could. RBC was actually one of the few that refused him in his final months. You can't say it's irrelevant to retail banking because big banks certainly do wealth management and portfolios.

The point is that being a big FI does not mean you won't have incompetent managers, no matter how "professional" they are.

You got into this conversation for a particular reason, but you have made these points numerous times, and I got tired of reading them, so it was time to put out another point of view.

You have now switched to your usual excuse as to why small CUs won't survive, which is not to do with management professionalism or amateur board members but rather that you think they won't be able to handle the regulatory stuff and new product. (Personally, I have found that new banking products usually favour the house and that's why they invent them.)

An advantage of CUs is that they are not , as far as I can see, involved in that "other" side of the banking business that big banks do deal in. A large bank with international presence deals in a lot more than mortgages and GICs, with associated risks.

I know you're out of touch with CUs right now, but most of them do offer etransfers, bill payments and credit cards. The credit cards, as far as I can tell, are all offered through Collabria, and are provided through Mastercard or Visa, so you should get the same service as any other CC holder if you happen to be in Nepal, bearing in mind that the vast majority of people never get to such exotic locations and that phone and internet connections in Nepal can be iffy. Your level of suspicion is unwarranted.

Like everything, some CUs are better managed than others. I can clearly see that from the ones I deal with. I don't mind if they join up with another one or two others, but if they start imagining themselves being Meridian or Coast Capital, that will be their undoing for sure. From what I have seen, most of them are growing annually as more people understand that the big banks don't really serve their needs.

I got a phone call the other day from a friend in Alberta who had some cash to put into GICs and wanted my advice on where to put it. He said he and his wife have always dealt only with their local credit union in the past. These people are both retired professionals with good pensions and they travel all over the place. Obviously doing all their banking with a CU has not impeded them, and they intend to continue to do most of their banking with that CU. I didn't ask which one it was, but AB doesn't have the largest ones.

Something else worth remembering is that CUs don't siphon off profits to pay out large dividends to non-members.

As for "competitive and relevant", I get that much more frequently from my small CUs than anywhere else because they are more likekly to have good promos. I am keeping my acounts at CIBC , TD and Meridian for now, but they don't offer me anything I need that I can't get at a small CU. Meridian occasionally has some good GIC offers but they normally save them up for RSP season.

If regulatory demands get so out of control that they kill off smaller businesses, then we're in trouble. A well managed economy allows them to grow and thrive and doesn't snuff them out.

I could say a lot more but that's probably enough.
Well, maybe one more thing, and that is that it's unwise to assume anything is inevitable. Boxing oneself into a corner like that makes one less able to see what you didn't anticipate.

August 7, 2021
7:35 am
AltaRed
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You continue to mix the broad definition of banking with everyday retail banking but that is not the real issue. You have your bias as I do mine.

The realism of the matter is current consolidations are happening in the CU space with smaller CUs being gobbled up by larger entities. That is happening for a number of reasons, most of them associated with future competitiveness and survival in this rapidly evolving digital world. I see that in the consolidation news releases (marketing spin aside).

I have little doubt consolidations will continue at the rate of several per year and members, in my opinion, should be supportive of such consolidations by not recommending a vote 'against'. The CU landscape will most likely look radically different within 10 years.

P.S. FWIW Loonie, I do appreciate your posts even if we have different views. I continue to learn from what you write and expanding one's views has never been a bad thing. Keep it up!

August 7, 2021
8:07 am
canadian.100
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Loonie said

I got a phone call the other day from a friend in Alberta who had some cash to put into GICs and wanted my advice on where to put it. He said he and his wife have always dealt only with their local credit union in the past. These people are both retired professionals with good pensions and they travel all over the place. Obviously doing all their banking with a CU has not impeded them, and they intend to continue to do most of their banking with that CU. I didn't ask which one it was, but AB doesn't have the largest ones.
 

So what advice did you give them re where to put their extra cash - I am always looking for places to put extra cash, GICs included if attractive, so wondered what your recommendation was. Thx.

August 7, 2021
9:55 am
Bill
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Personally I see a bright future for credit unions. Canadians increasingly disparage large corporations and the notion of (except for their own) "profit", many prefer small businesses and the notion of "non profit", so credit unions should prosper at the expense of the evil big banks, seems to me. The few folks I know who deal with credit unions do it at least partly as an ideological signaller, a public expression of the ethics they like to think they have, and those are extremely popular sentiments these days. Plus their banking needs seem pretty basic, not a lot of wealth, if any, to manage, so again fits in nicely with credit union model.

August 7, 2021
11:44 am
AltaRed
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The CU model does serve the community well. That has never been an issue. CUs sprang up because banks were serving so many communities poorly, or not at all.

Loonie made a comment about the relative lack of CUs in AB and that may well be true, but if it is, it is because the AB government a long time ago got fed up with Eastern Canada based banking centroids ignoring the west and they established Treasury Branches (now ATB) to serve Albertans province wide. Many smaller communities had no broad based banking except via ATB.

I still see CU consolidation happening over time. Perhaps as few as 3-5 in BC total. The whole southern interior of BC could be served by one large regional CU with the critical mass, e.g. $15-20B in assets, to be competitive in the digital world that knows few boundaries.

August 7, 2021
12:33 pm
Norman1
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I think that times have changed. Those poorly served communities are now well served by the banks and the reasons for starting some of those credit unions don't apply anymore.

For example, the credit card market in Canada is now saturated. Banks will now issue a credit card to anyone who doesn't have a bad credit record. They will even throw in signup bonuses! Access to credit is not a big issue anymore.

Even before recent changes, I saw little reason to deal with a credit union besides the virtue signalling that Bill mentioned.

Bank accounts. I've found lower service fees with the Big Banks than with credit unions. The credit unions nickeled-and-dimed just like the banks did. Unfortunately, I didn't run into any exceptions, like BCU Financial and Equity CU, back then.

Similar with interest rates. Years ago, I rescued a relative from his credit union that was offering to renew his 5-year GIC at three full percentage points below what Royal Bank was offering! sf-surprised

We certainly don't need another me-too financial institution offering a savings account that pays 0.05% per annum. The Big Banks already offer that to anyone already.

August 7, 2021
12:47 pm
Bill
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I've read that 99% of Canadians have a bank account, lots of business for the relatively few banks to share. There are about 6 million credit union members for the 230 or so credit unions to share, and not sure how many of them use CU as their primary banking source (e.g. spouse and I are still nominally members of a bunch because we once bought a gic or opened a high interest account there). Pretty clear, especially with concentration of people into cities, there will be more CU mergers, perhaps especially involving the many small, rural-located ones. CU's in cities will probably do quite well (lots of hipsters) going forward.

August 7, 2021
6:56 pm
Norman1
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I think it will depend on what those small rural credit unions provide the remaining members.

If the rural credit union provides specialized rural-related lending and financing that the Big Banks are not interested in, then it will continue to thrive.

On the other hand, if the rural credit union just provides teller service for the remaining people to deposit or cash their paycheque every two weeks, then its days will be numbered. There would be little need for it once the employers do direct deposit payroll, instead of physical paycheques, and people start using Interac e-transfers, instead of cheques, for personal payments.

August 7, 2021
11:15 pm
Loonie
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canadian.100 said
I have dealt with a number of CUs and I agree with Alta Red that there is an "amateurish" tone and approach in the way some are governed and in the way they operate.
Reading all the posts in regard to Pace CU and the way they serviced and advised clients - for sure, a very amateurish and unprofessional operation.
While banks are not perfect, it is those amateurish vibes at CUs which I have picked up more quickly in my own experiences dealing with CUs and I am referring not to my dealings with just the front line "associate" but with the Supervisor and Manager levels.  

They're not all amateurish any more than all banks act professionally. The beauty of CUs in part is that there are real choices whereas the big banks are basically all the same.

In my own CU experience, I have dealt with the CEO at one of the small ones and he is excellent. At another, the rep I deal with is a CFP, several notches above the average rep (salesperson) at the banks. It's a matter of shopping around and seeing which ones are well run and really meet your needs. I have the advantage of living in Toronto where there are a number of CU choices.

That said, in general, the bigger they get, the less responsive they are to member needs. For example, yesterday I had to call DUCA because of issues with their website. It was the second time I'd had to call about the same problem. Only after about a half hour of conversation did she finally respond to my initial request. I also requested that she inform their tech dep't about the problem (which, although I now have a workaround, remains unresolved) but she was very reluctant to do this and I doubt she will. I wouldn't get that sort of canned response from my small CUs and it doesn't make me feel like a valued member-owner, which is key to a successful CU.
I strongly urge CU members to attend AGMs where possible; you can get a real feel for how the place is run and it helps you develop good questions to ask of the others.

August 7, 2021
11:53 pm
Loonie
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AltaRed said
You continue to mix the broad definition of banking with everyday retail banking but that is not the real issue. You have your bias as I do mine.

The realism of the matter is current consolidations are happening in the CU space with smaller CUs being gobbled up by larger entities. That is happening for a number of reasons, most of them associated with future competitiveness and survival in this rapidly evolving digital world. I see that in the consolidation news releases (marketing spin aside).

I have little doubt consolidations will continue at the rate of several per year and members, in my opinion, should be supportive of such consolidations by not recommending a vote 'against'. The CU landscape will most likely look radically different within 10 years.

P.S. FWIW Loonie, I do appreciate your posts even if we have different views. I continue to learn from what you write and expanding one's views has never been a bad thing. Keep it up!  

Broad based banking and consumer retail banking are not unrelated. The large banks do both, perhaps under different umbrellas.
Much of what I am trying to say about Bernie is that he fooled financial professionals, including several managers at the SEC who didn't think it was worth investigating him even when offered hard evidence. You say many CUs are run by amateurs. I say professionals don't necessarily do better than an intelligent informed "amateur" - although I don't think Ive ever encountered a CU CEO who was armed solely with a BA in psychology or equivalent. They all seem to have at minimum a degree in commerce or economics and usually a master's. I do think that the CUs should do more in cooperation with each other for greater efficiencies in the same way they do their credit cards and use the same brokerage.

If I understand your acronym correctly, the CDOs were based on retail mortgages initiated at retail level, although probably too many from Fannie and Freddie. I could be wrong but I think they turned them into CDOs when they realized they were a poor investment.

As I said, I would support mergers where there is a financial necessity, but not simply because it is assumed they can't succeed as they are.

Thank you for your kind words. I also have learned from you.

I don't pretend to know everything, and I have no formal education in finance, but I will continue to present what appears to me to be the case. Sometimes the lay person with some intelligence, critical thinking skills and common sense can see things that the professionals, who are all basically trained to think the same way and congregate at the same water coolers, miss.

August 8, 2021
12:03 am
Loonie
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canadian.100 said

Loonie said

I got a phone call the other day from a friend in Alberta who had some cash to put into GICs and wanted my advice on where to put it. He said he and his wife have always dealt only with their local credit union in the past. These people are both retired professionals with good pensions and they travel all over the place. Obviously doing all their banking with a CU has not impeded them, and they intend to continue to do most of their banking with that CU. I didn't ask which one it was, but AB doesn't have the largest ones.
 

So what advice did you give them re where to put their extra cash - I am always looking for places to put extra cash, GICs included if attractive, so wondered what your recommendation was. Thx.  

My recommendation was specific to their circumstances and there is nothing about it that you don't already know.

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