Business model has proven very successful for Manitoba credit unions

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WINNIPEG, Manitoba (March 23, 2017) — The annual convention of Manitoba credit unions takes place in Winnipeg today, followed by the annual general meeting of Credit Union Central of Manitoba (CUCM) on Friday.

Among the topics credit union leaders will be examining is the variety of paths to the future that all Canadian financial institutions are considering, as they try to balance traditional customer service, emerging technology, compliance, member-customer needs and profit. For some, profit is the deciding factor.

“As co-operatives and community based organizations, credit unions operate on the principle of ‘profit for service, not service for profit’,” says Garth Manness, CUCM’s President and Chief Executive Officer.

“Credit unions are profitable enterprises and all members are shareholders,” he explains, “so that when credit unions plow profits back into their operations — to enhance electronic services, offer very competitive loan and savings rates and keep fees low — all members benefit.”

After contributing to their own equity to meet regulatory requirements, and supporting community groups and initiatives, credit unions return any profit that remains directly to members in the form of shares or rebates.

It’s a business model that has proven very successful in Manitoba, with its long co-operative tradition, but the popularity of credit unions doesn’t stop with the model, Manness says.

“In survey after survey, Manitobans say they are highly satisfied with credit unions’ level of service and the services — in-branch and electronic — that provide them with what they need. They also say credit unions have the best interests of their members at heart, compared to other financial institutions.”

Over 38 per cent of Manitobans belong to a credit union, and 47 per cent of businesses use a credit union as their financial institution.

At year-end 2016, credit unions had over 600,000 members and combined assets of $27.2 billion. Since 2006, assets have grown 137 per cent. The province’s 33 credit unions have branch operations in 109 distinct communities; in 61 of those communities, a credit union is the only financial institution in town.

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Manitoba Credit Unions: 2016 Results at a Glance

Dec 31 results 2016 2015 change
Members 612,016 610,831 1,245
Deposits $24.97 billion $23.93 billion 4.35%
Loans $22.89 billion $21.61 billion 5.92%
Assets $27.21 billion $25.91 billion 5.02%
Profitability $126.3 million $116.7 million 8.20%
Equity $1.75 million $1.62 billion 8.02%
Equity as a percentage of assets 6.42% 6.24% 0.18%
Credit Unions 34 34
Branches 182 186 – 4
Number of communities where a CU is the only FI 61 62 – 1

About Credit Union Central of Manitoba (CUCM)
CUCM is the trade association and service provider for the province’s 33 autonomous credit unions and is governed by Manitoba’s Credit Unions and Caisses Populaires Act and the federal Cooperative Credit Associations Act. CUCM manages liquidity reserves, monitors credit granting procedures and provides trade services in areas such as corporate governance, government relations, representation and advocacy. CUCM also provides payment and settlement systems, banking, treasury, human resources, research, communications, marketing, planning, lending, product/service R & D, business consulting and legal services to credit unions. Manitoba credit unions jointly own CUCM and representatives from six credit union peer groups sit on its board of directors. CUCM is financed through assessments and fee income derived through its operations.

Contact: John Hamilton, Manager, Knowledge Services & Communication
Cell: 204-223-1976 Office: 204-985-4785
Facebook: ManitobaCreditUnions  |    Twitter: @ManitobaCUs