Thank you.
Mr. Chair, committee members, my name is Jodie Stark, and I'm vice-president of legal and corporate affairs at Concentra Financial. Our head office is located in Saskatoon, Saskatchewan. I'm please to have the opportunity to present to all of you today.
Concentra Financial is a successor of the Co-operative Trust Company of Canada, which has been operating since 1952. Concentra Financial is the only federal retail association in Canada operating under the Cooperative Credit Associations Act. Concentra has the broad powers of a national bank and is federally regulated by OSFI, CDIC, and FCAC. Concentra was designated as one of Canada's 50 best managed companies for the ninth consecutive year in 2012, and employs 287 staff across Canada.
Concentra exists to enable credit unions to optimize their financial performance and to provide full service offerings to their members. Recently, the federal regulators have expressed concerns that regionally based credit unions may be at greater risk than banks, as their operations are local and subject to the economic conditions within that region. Concentra is able to mitigate that risk, by acting as a financial intermediary through offering syndicated loans and investment opportunities for mortgage pools to credit union partners, which in turn diversifies their investment portfolio. In addition, Concentra offers advisory services to assist our credit union partners in managing their operations. We also operate a liquidity bulletin board, which allows credit unions the ability to post and acquire liquidity when it is available within the system.
Concentra Financial's wholly owned subsidiary, Concentra Trust, provides trustee services to almost 80% of Canada's credit unions outside of Quebec, so that registered-plan programs can be offered to credit union members. The credit union system supports the initiatives of the federal government in developing these savings programs so that Canadians can save for the future and be self-sufficient. Concentra enables credit unions to service these registered programs. Concentra Trust also provides trust and estate services to members of credit unions. Concentra's profits are returned to the system through charitable donations to community-based initiatives across Canada and through dividend payments to its owners, who are credit unions, centrals, and other cooperative entities.
SaskCentral has provided to you a brief that outlines the statistics showing the strength of the credit union system in Saskatchewan. I'd like to take this opportunity to share with you the importance of credit unions and cooperatives to Saskatchewan residents.
Before the formation of our province, our land was populated by first nations, Métis, and Inuit. These cultures were governed primarily by the same principles as today's cooperatives, with an emphasis on self-government and self-sufficiency. It has been said that they were the first cooperators to exist in North America.
By 1910, the first credit union in western Canada was developed in Wapella, Saskatchewan. From there, the cooperative movement blossomed and provided insurance, financial services, and retail products. Throughout the Great Depression and the drought of the 1930s, consumer and producer cooperatives ensured the survival of many Saskatchewan communities.
In 1928, the Saskatchewan Co-operative Youth Program was formed. Remarkably, that youth camp continues even today, and my daughter attended their program just last summer. The Federated Co-op was also formed that same year, and is now one of the most profitable businesses in Saskatchewan.
One of the advantages that cooperatives and credit unions have over larger traditional institutions is the ability to be innovative and creative in finding solutions. The Co-operative Commonwealth Federation, or CCF party, formed in the 1930s, was instrumental in the development of the universal medicare program, which was launched in our province in 1962. Coincidentally, my family was one of the first in Saskatchewan to be issued a health card at that time.
The Centre for the Study of Co-operatives was established at the University of Saskatchewan in 1984. In 1985, the first debit card in the world was piloted in Swift Current, and I recall my father explaining to me how to use the new ATM machine at our local credit union. He told me that electronic banking would change the way we do business, and how true that is. Three years later, my father walked me down the aisle, and I was wearing a wedding gown purchased from our local Pioneer Co-op.
Credit unions and cooperatives not only provide innovation to benefit Canadians, but, for many communities, they also provide the infrastructure. From gas stations to grocery stores and retail outlets to credit unions, cooperatives are the very heart of so many communities. Many of my friends graduated from college and went on to be employed by cooperative entities, enabling them to remain in their home province. I do my banking at a credit union that is managed by people I personally know and trust. My groceries and fuel also come from co-ops. In Saskatchewan, credit unions build buildings and operate the only financial institution in many communities. They sponsor sports teams and arenas, and almost every major centre has a credit union name attached to it.
It is no wonder that 5.2 million Canadians are members of credit unions, which represent community, giving back, and a sense of belonging.
Not only have credit unions been instrumental in establishing an infrastructure in developing nations, along with the early settlers in western Canada, they have also survived and flourished in the face of economic crises. From the stock market crash in 1929 to the recent economic crisis in 2008, banks and shareholders suffered great losses. However, credit union members took comfort in knowing that their money was safe and being managed locally by people they know and trust.
Scandals continue to erupt, involving executives of large banks and investment firms, something that is unheard of in the credit union system. Saskatchewan credit unions do not rely on government funding or bailouts, and these credit unions provide a 100% guarantee on members' deposits. Credit unions also offer financing to farmers and small business owners when traditional banks turn them away.
Cooperatives ensure that cultural traditions are sustained, while still engaging the youth, and they provide opportunities for development of first nations communities, small towns, and large urban centres. They are all encompassing and are embedded in the very fibre of what makes Saskatchewan the successful province it is today.
It is no coincidence that Saskatchewan has grown stronger in the last few years while many other provinces have struggled to survive the crippling economic crisis. Our reliance on our own people—our greatest natural resource—guarantees resilience in the face of diversity. It is our spirit of co-operation and self-sufficiency that creates our own success.
On behalf of Concentra and our partners in the credit union system, I ask the federal government to support the unique governance principles that make up the framework of credit unions. Now that we have the ability to form federal credit unions, I ask that the government refrain from considering and treating these credit unions simply as banks. To do so would be to threaten the very structure that has provided members with stability in the system for the last century
I also ask that the government consult with the credit union system on all matters relating to financial legislation. Although we have 5.2 million members, we are not always recognized as having a collective voice. However, we do have trade associations that represent us and are available for consultative purposes.
It is critical that we be considered when legislation is being developed or amended. I will provide a more detailed brief for this committee's review, which is being prepared.
Mr. Chair, Concentra Financial wishes to thank this committee for undertaking this study in recognition of the International Year of Cooperatives.
In conclusion, I want to thank you for this opportunity to provide a Saskatchewan perspective, and I would be happy to respond to any questions you might have.