Thursday, 13 June 2013 08:58

Innovation Credit Union closing six branches in southwest Saskatchewan

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For six small communities in southwest Saskatchewan the local credit union will soon not be down the street anymore.

 

Innovation Credit Union has announced the closure of branch locations in Climax, Coderre, Hazlet, Pennant, Sceptre and Shamrock on Oct. 1.

Innovation CEO Dan Johnson said it was a difficult decision, but the credit union will continue to provide members with the services they require.

“We have a strong array of additional channels that our members can utilize, things like online banking, mobile banking, our call centre,” he mentioned. “So those channels are definitely available for them and what we've found is in all the communities that we've looked at the community members had to go to other locations to do most of their business anyways.”

Nine staff members, some working full time and others part time, will be impacted by the closure of the six branches.

Johnson emphasized the branch closures do not reflect the current financial health of Innovation Credit Union.

“We are very sound financially,” he said. “However, going forward we have certain legislated minimums that we have to comply with and so we have to make sure that in this competitive environment that our organizational structure is build to survive. It's not like we're losing money but we need to keep our profits appropriate.”

Innovation announced a patronage allocation of $2.35 million to members in March. This was the largest payout in five years and for the first time ever members also received a cash dividend of 4.58 per cent on active equity accounts.

According to Johnson a few key issues played a role in the decision to close six branches. The profile of each community, including projections of population growth, and the evolving financial needs of members were considered.

“Across all of the industry and all of our branches our members are using the branches less and less,” he said. “So they're endorsing more electronic means versus in branch traffic. That's a general theme across the entire industry.”

The financial viability of the six branch locations was considered within the broader context of operating efficiency and ensuring Innovation’s future sustainability.

“So given the size of the branch and the amount of business that resides there, is it enough to sustain a branch presence,” he explained. “So that's a financial element.”

The issue of staff safety at smaller branches was also a concern, as only one or two staff members are currently working at these locations.

“We feel they're prime targets for robbery and that sort of thing,” he said. “You see every once in a while a branch that's been impacted. So we're aware of that and we want to make sure it doesn't happen to us.”

Lindsay Alliban, the economic development officer for Hazlet, said the community will be losing one of its essential services. Residents will have to drive to an Innovation Credit Union branch in Cabri, Gull Lake or Swift Current.

“It's a terrible thing for the community,” she noted. “We're a small village, we have limited services here, but we are growing in the same sense. We've maintained our K to Grade 12 school here, we have a co-op, a cafe, a store, a library, and without our credit union that really takes a hit on all those businesses.”

Hazlet has a population of about 100 residents and also serves 300 people in the surrounding area. According to Alliban the residents are upset about the closure of the credit union branch.

“Hazlet isn't known to just let things slide,” she said. “We usually are known for fighting back for anything in our community. We fought to keep our school open, we fought to keep lots of businesses open. So losing the credit union was a big shock.”

She is confident the community will rally to address the need for a financial institution in their village.

“We refuse to accept that our credit union is closing,” she said. “We definitely aren't just going to let this happen. We're going to fight to stay with Innovation or we're going to try and attract some other credit union that may want to be part of our community.”

Innovation Credit Union has invited members to attend a number of member meetings in the affected communities during June to learn more about the decision.

“Some just aren't aware of the process we go through and it is an extensive process,” Johnson said. “It’s to provide them with an opportunity to voice their concern and then indicate how we can still serve them effectively going forward.”

The Hazlet and Sceptre meetings took place on June 10. The Pennant member meeting will take place on June 24 (6 p.m., Pennant Community Hall). The meeting in Climax will take place on June 25 (12 p.m., Climax Community Hall) and the Coderre and Shamrock member meeting is scheduled for June 26 (12 p.m., Coderre Hall).

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Matthew Liebenberg

Reporter/Photographer

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