NIAGARA FALLS, ON – Every branch and both corporate offices of NIAGARA Credit Union and HEPCOE Union will remain open and the 1,000 employees of both organizations will have jobs if the largest credit union merger in Ontario history is approved.
In addition to keeping all 43 branches operated by the two credit unions open, NIAGARA Credit Union’s St. Catharines’ corporate office and HEPCOE Credit Union’s downtown Toronto office will remain at the same locations, Sean Jackson, President and CEO of NIAGARA Credit Union, and Ian McLeod, CEO of HEPCOE Credit Union announced today.
“No employees will be laid off as a result of this merger. Every branch employee will keep his or her job. Every corporate office employee will be offered a job in the new credit union,” Jackson, who will become CEO of the new credit union, said.
McLeod said that the merged credit union is committed to being the number one financial institution in Ontario for outstanding relationship service.
“We plan to reinvent neighbourhood banking over the next three years,” McLeod said.
He added that Members will see benefits such as branch operating hours tailored to local needs; fees that reward long-term loyalty and reduce banking costs; and more resources for employees so that they can better serve Members.
The merger will also provide the resources needed to expand the highly successful Business Banking model developed by Niagara Credit Union, according to Don Ariss, Chair of HEPCOE Credit Union.
“Our ability to deliver financial services to commercial Members will increase significantly, creating jobs and building communities in both the Niagara Region and HEPCOE Country,” Ariss said, adding that three new Business Banking Centres will be opened as a result of the merger.
The commitment of both credit unions to support the communities in which they operate will also be strengthened by the merger, according to Erv Krause, Chair of NIAGARA Credit Union.
Credit union contributions to community, charitable and other worthwhile causes will double to almost $1 million annually, four times the national average for an organization of this size.
“Partnering with the community is one of the many core values HEPCOE Credit Union and NIAGARA Credit Union share. We understand the importance of our role in building the communities we serve. We’re committed to expanding that role through this merger,” Krause said.
As well, the new credit union is committed to ensuring that the majority of community investment decisions will be made locally, in the communities where our members and branches are located.
Jackson and McLeod also announced that Meridian Credit Union has been selected as the name of the new credit union.
“Meridian stands for the line of financial service that connects every event in a Member’s life to personalized attention, the right people, the right advice, where and when it is needed,” McLeod said.
Both Jackson and McLeod said they were particularly pleased that this merger, unlike many others, can be accomplished with no layoffs or closures.
Jackson said keeping both corporate offices open and retaining employees who have been responsible for the success of both credit unions is not only the right thing to do, it makes good business sense.
“We value the experience and expertise of the people who have been serving our Members well, and are counting on their contribution to take our service to the next level,” Jackson said.
Corporate functions will be divided between Toronto and St. Catharines and corporate employees will be provided with relocation assistance if required. No changes will take place before April 1, 2006.
HEPCOE Credit Union, established in 1942, is a full service financial institution providing personal and commercial banking through 25 branches throughout central Ontario and around the GTA. HEPCOE is Ontario’s third largest credit union with $1.5 billion in assets under administration.
Established in 1945, NIAGARA Credit Union is Ontario’s second largest credit union with 100,000 members and over $2 billion in assets under administration. Niagara Credit Union provides a full range of retail and commercial financial services through 18 branches and four commercial banking centres in the Niagara Region and Guelph-Wellington County.
Pending approval by Members, Shareholders and regulators, the merger between two of Ontario’s largest credit unions, NIAGARA Credit Union and HEPCOE Credit Union, will create the third-largest credit union in Canada, and will strategically position the new organization as a significant competitor in Ontario’s financial services industry; signalling the beginning of the coming-of-age of the credit union system in Ontario.
What began in the 1900s as a solution to avoid excessive rates of interest charged by private lenders, the Canadian credit union system has stood the test of time. It currently consists of 572 credit unions and affiliate caisses populaires with combined assets of approximately $74 billion, serving 4.63 million Members.
The Credit Union Central of Canada (Canadian Central) is the national trade association and central finance facility for credit unions in Canada. Eight provincial Central credit unions form a middle level of the national credit union system with British Columbia, the largest, having a total of $30 billion in assets, 58 credit unions and more than one million Members, to Prince Edward Island with $565,000 in assets, 10 credit unions, and roughly 63,000 Members. By comparison, Ontario currently has 209 credit unions with over $19 billion in assets, serving approximately 1.5 million Members.
Initially credit unions struggled to find a niche in Ontario; however, during the ’40s, ’50s and ’60s, hundreds of credit unions emerged across Ontario fulfilling a financial need primarily in parishes, employee groups, and trade/professional associations. By the ’60s, credit unions and caisses populaires numbered 1,400 in Ontario, and in the ’70s, credit unions began to merge, resulting in fewer credit unions serving more Members.
Established in 1945 in Virgil, NIAGARA Credit Union is now Ontario’s second largest credit union — the seventh largest in Canada — with 100,000 Members and over $2 billion in assets.
Originally founded in 1942 to serve employees of Ontario Hydro, HEPCOE Credit Union is currently Ontario’s third-largest credit union — the twelfth largest in Canada — with approximately $1.5 billion assets and 80,000 Members.
With the financial services marketplace expanding nationally and internationally, greater incentives exist for credit unions to collaborate and combine their efforts across local and provincial boundaries not only to achieve efficiencies and economies of scale but also to provide incomparable service to their Members and communities. Recent indicators from the sector are signalling more mergers as the credit union sector reacts to these changing market conditions in the financial services sector.
If the merger is approved, the new credit union will hold approximately $3.5 billion in assets, more than 180,000 Members, and more than 40 branches in Central and Southern Ontario including the Greater Toronto Area, the Niagara Region, Guelph, Barrie, Collingwood, Hanover, and Owen Sound.
