Major Canadian credit unions are putting their weight behind proposed federal legislation that would turn them into federal players and ultimately more important broker partners.
Coast Capital Savings Credit Union, Canada’s second largest credit union, is the latest institution to come out praising Jim Flaherty’s framework for the federal expansion of credit unions.
Tracy Redies, president and CEO of Coast Capital said the union has been a long-time advocate of federal legislation that would allow credit unions to expand beyond their provincial boundaries. The opportunity as laid out by the Finance head make it easier for those cooperative lenders to operate beyond their provincial boundaries and increase consumer banking choices.
Brokers also stand to benefit, as MortgageBrokerNews.ca reported Friday, the legislation would allow mortgage professionals to help CUs break into new markets – those lenders usually dangling generous compensation plans to win broker support.
When giant Vancity was hunting around for the best way to catapult itself into the Vancouver Island market – what was then virgin territory – it targeted mortgage brokers as the best way to get that job done.
While Coast Capital has put it national support behind the regulatory framework, Redies said the credit union’s decision to move into federal lending would depend on a closer evaluation of the Bill C-9, saying Coast Capital will only pursue the federal credit union option if it aligns with the company’s growth plans.
"Coast Capital supports the federal credit union legislation in principle because we believe Canadians should have more choice when it comes to national banking alternatives," she said. "However, we are committed to open dialogue with our members, employees and community partners before making any move.”
Credit Union Central of Canada also welcomed the regulatory changes Friday. Gary Rogers, vice president, Financial Policy said the organization welcomed the step toward enabling credit unions to address growth opportunities.
Under the proposed legislation provincially regulated CUs would be given the option to become federally incorporated, allowing them to operate across provincial borders.