Credit Unions – Owned By Their Customers
Instead of being owned by shareholders like chartered banks, credit unions and caisses populaires are owned and controlled by their members. Their main purpose is providing financial services to members.
To become a customer of a credit union or caisse populaire, you must become a member. The cost of joining ranges from $5 to $125. This makes you a shareholder and gives you one vote, no matter how much money you have in your account. Members can vote for the board of directors, run for election, attend annual meetings and vote on motions. As shareholders, members also receive dividends and profit sharing.
Almost all credit unions (outside Quebec) are shareholders in one of the nine provincial “Credit Union Centrals”, which provide wholesale lending and look after settlement of cheques and electronic payments for local credit unions. And all nine provincial centrals are the main shareholders of Credit Union Central of Canada (CUCC), which is responsible for making sure there is enough available cash at the national level. The CUCC is chartered and regulated by the federal government under the Cooperative Credit Associations Act and gives the credit union system a national voice on financial service issues.
Caisses populaires are more centralized than credit unions and operate under a single name. The Mouvement des caisses Desjardins consists of a network of caisses populaires in Quebec, Manitoba, New Brunswick and Ontario – as well as a holding company called the Desjardins-Laurentian Financial Corporation (DLFC). They are all members of the Fédération des caisses Desjardins du Québec. If you add together all their assets, the Mouvement des caisses Desjardins is the sixth largest deposit-taking institution in Canada (Dec. 31, 2001).
In addition to key service areas such as residential mortgage financing, consumer credit and deposit services, most credit unions offer term deposits, RRSPs, RRIFs and RESPs, business financial products and services, loans, financial counselling, trust and insurance services and more.
Credit unions tend to be very receptive to the special needs of members. During periods of economic difficulty in many parts of the country, for instance, some credit unions have developed innovative loan repayment options and adopted a sensitive approach to accommodate individual member needs.
There are more than 500 credit unions and caisses populaires in Canada with more than 4.5 million members and combined assets of almost 78.5 billion dollars. Canada has the world’s highest per capita membership in the credit union movement, with over 10 million members, or about one-third of the Canadian population.
The largest credit unions in Canada include:
BC based Vancity Savings, which owns Citizens Bank of Canada, serving members across the country by telephone, ATM, and the Internet.
Coast Capital Savings is Canada’s second largest credit union with $6.7 billion in assets and 44 branches across the Lower Mainland, Fraser Valley and Vancouver Island.
Meridian Credit Union, launched on April 1, 2005, the result of the merger of two of Ontario’s largest credit unions, NIAGARA Credit Union and HEPCOE Credit Union. Meridian is now the largest credit union in Ontario and the third largest in Canada.
Alterna Savings, which was formed by the merger of Metro Credit Union and CS CO-OP, . With 24 branches, approximately $1.8 billion in assets and over 190,000 members, Alterna Savings is now the second largest credit union in Ontario and one of the five largest in Canada.
Edmonton based Capital City is the largest credit union in Alberta and the fifth largest in Canada.
Employment in the sector increased from almost 41,000 employees in 1991 to about 56,400 in 2000 and, as with other financial institutions, a large proportion of their employees are immigrants.