Thank you, Mr. Chairman.
I have about five minutes of opening remarks.
Mr. Chair, members of the committee, thank you for the opportunity to speak to you today.
I'm joined by Mr. Ralph Luimes, chief executive officer of HALD-NOR Credit Union, located in southwestern Ontario. Mr. Luimes is also the chair of the steering committee responsible for the Canadian business owner strategy, our system's initiative aimed at the small to medium-sized business market. But more on that later.
Before addressing the issue that brings us before you today, please allow me to begin by making a few preliminary remarks regarding the role of Canadian Central, my organization, and more generally the credit union system in Canada.
Canadian Central is a federally regulated financial institution that operates as the national trade association for its owners, the provincial credit union centrals, and through them for approximately 440 affiliated credit unions across Canada. With over 1,700 locations, serving more than 5 million members, 24,000 employees, and holding $114 billion in assets, credit unions represent an important component of the Canadian economy.
Credit unions in Canada come in all shapes and sizes and operate in almost every community, including large urban centres. Credit unions are the first choice of financial institution for many Canadians. In fact, one in three Canadians is a member of a credit union or a caisse populaire.
We believe these numbers reflect the system's strong cooperative values and commitment to the economic development of their communities in good times and bad. This commitment is illustrated by our continuing presence in more than 380 communities in Canada where a credit union is the only financial institution in town. Community involvement and commitment are also evidenced by the high level of the system's charitable donations, scholarships and bursaries, and employee participation in community development. In fact, in 2007 Canadian credit union community involvement reached $35.8 million.
Let us now turn to the topic that brings us before you here today: credit availability and the stability of the Canadian financial system. Let me first assure you that as member-owned institutions, credit unions are very much aware of the economic difficulties currently facing Canadians, and credit unions are working closely with their members and their communities to temper the impact of the crisis.
That said, certain reports have claimed that the availability of credit to businesses and consumers has, in recent months, shrunk. As a general observation, this may be true in that non-traditional lenders have retreated as financial market liquidity has grown tighter and the market for securitization has shrunk. However, the credit union system has not participated in this pullback from credit granting. Instead, we have pursued our more traditional relationship-based approach to lending, and credit unions continue to meet their members' demands.
In 2008, credit union loans grew by 7.2%. In the last quarter of 2008, our loans increased by 1.6%, which on an annualized rate amounts to a growth of 6.5%. Loans as a percentage of total deposits were 93.7% at the end of 2008, down slightly from 95.8% 12 months before, a reflection of strong growth in deposits in 2008. That stated, it's interesting to note that 10 years ago loans represented only 87% of total deposits.
Credit unions are committed to the small and medium-sized business market. Industry Canada statistics illustrate this as well. A comparison of Industry Canada SME lending data, looking at the chartered banks, foreign banks, and credit unions reveals that nationally, credit unions account for 18% of the SME lending market for authorizations $500,000 and under. In P.E.I. and Manitoba, this figure is 50%. In Saskatchewan it equals 62%, in Alberta 20%, and in B.C. 28%. This market is a key to credit union growth, and our system will not pull back from our SME members.
Our commitment to this important market is further demonstrated by the system's Canadian business owner strategy, more commonly known within our system as CBOS. Created in 2005 to enhance the competencies and capacities of credit unions to serve the business owner market as well as to raise awareness about credit unions with business owners, CBOS has actively engaged over 300 credit unions since the start of the program.
As for the matter of financial stability, I wish to highlight that the credit union system remains strong. Despite the economic downturn that began in the last quarter of 2008, the Canadian credit union system ended 2008 on solid financial ground. System assets, savings/deposits, and loans all recorded gains, maintaining the annual growth reported in previous quarters, although down somewhat from the rates reported in 2007.
By the end of 2008, the combined assets for affiliated credit unions and caisses populaires across Canada rose by 8.7% or $9.1 billion, to reach $113 billion. This is a 45% increase, or a $35.2 billion gain, over the last five years. Deposits and savings growth remained strong as total deposits with credit unions increased to $100.6 billion in the fourth quarter of 2008, up 9.5%, or $7 billion, from the previous year.
We believe the system is well positioned to face the challenges presented by the current economic situation and the opportunities to come in 2009 and beyond.
We wish to thank you once more for the opportunity to address you today. Mr. Luimes and I will be pleased to answer any questions you may have.