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Merger Proposal discussed

Posted on March 4, 2014 by Shaunavon Standard

About 60 people turned out for an informational meeting last week that outlined details about Shaunavon Credit Union’s proposed merger with Affinity Credit Unions.

“We’ve been very transparent all the way through this whole process,” said Shaunavon Credit Union general manager Chuck Gartner. “This is a member driven organization and we want to be up front and honest about the merger.” The gathering, held at Christ the King Church Hall on Feb. 24, opened with a presentation by SCU president Linda Kutschall. Kutschall revisited the conditions that led SCU to investigate a merger in the first place, such as the local organization’s difficulty attracting skilled workers, a tight financial environment, changing compliance regulations, and the challenges of meeting ever-changing technology and banking services and products. “Throughout the last several years SCU, and the Saskatchewan Credit Unions, have been faced with unprecedented industry upheaval, increased regulation and competitive challenges,” Kutschall told the crowd. “Your board determined that given the challenges that were facing SCU now and in the future, it would become increasingly difficult to maintain the high quality of services and products that our members have become accustomed to, and remain a financially strong independent credit union.” After a lengthy and thorough investigation into the pros and cons of a merger, and holding discussions with a number of the province’s major credit unions, the Shaunavon board of directors ultimately felt that Affinity would provide the best partner for Shaunavon members. SCU officials pointed to Affinity’s strong commitment to ongoing community support, as well as its governance structure that will see a Shaunavon representative appointed to its board of directors, as two of the deciding factors. Affinity will also establish a community council in Shaunavon that will provide some grassroots input into the local operation. Kutschall also said that the board’s top priority, while exploring merger possibilities, was its members’ financial well being. Affinity, which serves 140,000 members through 76 branches in 68 communities across Saskatchewan, also has the size and scale to provide members with better product offerings, service locations and technological advancements. Another high priority for the SCU was the well-being of its employees and officials last week said that there would be no loss of employment if the merger is approved, and that no Shaunavon worker will be required to relocate in order to keep their job. There will also be no reductions in employee compensation, and in some cases the local workers will actually see a wage increase. Community donations should also remain similar to what Shaunavon Credit Union has provided in recent years, and may even increase slightly. Affinity also provides a special community allocation of $50,000 every three years for community projects – with the local district councils deciding where the money will be distributed. “Your board believes the proposed merger provides a long term improved value proposition in key strategic areas – members, community, employees and financial,” said SCU board member Owen Sebastian, who also made a presentation during Monday’s meeting. “The merger is not a method to resolve any financial difficulties,” he added. “However, we feel we are reaching our growth capacity and wish to merge while we are in a position of strength. Affinity is also a financially strong credit union.” “Your board believes that a merger with Affinity CU will position us to operate more efficient and to be effective in an increasingly competitive market.” Last week’s meeting also included several visitors from Affinity, including Tim Schroh (Chief Operating Officer), Shawna Miller (VP Governance & Strategy), and board of directors Ed Cechanowicz (president) and Hugh Sampson. The meeting ended with a brief question and answer session. Among the queries was one about the future of the Bracken branch. Kutschall said that senior management from the SCU would be visiting with the branch later this spring, and meeting with community members, to determine its viability. However, she also said that no decision has been made yet regarding the future of the Bracken location. In order to proceed, members of Shaunavon will still have to give their approval for the merger at the annual meeting on March 31st. Seventy-five per cent of the eligible members present at the meeting must vote in favour of the proposal in order for it to be approved. If members approve the board’s recommendation, the merger will officially take place on January 1st, of 2015. SCU officials also said that if the merger proceeds, that local members can expect a full patronage payout at the end of the year. Affinity does not have a patronage allocation policy. Instead, its philosophy is to put those funds back into member services and products. Otherwise, local members will see very little change once the merger is approved. Gartner says that Shaunavon members will notice minimal disruption in being part of Affinity Credit Union. “Members will continue to have the same service they are accustomed to, from the same great people. What this merger will do is allow us to take advantage of the larger size and greater capacity to better meet member needs now and in the long term.” Affinity has branches across the province with $4.7 billion in managed assets and approximately 1,000 employees. Its head office is located in Saskatoon. Although it has branches in both Regina and Saskatoon, Affinity’s largest branch is actually located in Estevan. If approved, Shaunavon would become the eighth largest Affinity branch in the province, and its largest rural location. Members can learn more about the merger plan by visiting the Shaunavon Credit Union web site at myscu.ca

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