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Tech on tap for Access

By: Jordan Ross

Posted: 04/12/2018 8:17 AM

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The president and CEO of Access Credit Union says technological trends, and the impending loss of a provincial tax credit, are prompting the board to think creatively about the future.

Larry Davey made the comments following last week’s annual general meeting in Winkler, where members were briefed on last year’s progress.

"We enjoyed growth in both assets and loans, in and around eight percent on both," Davey said.

That translates into assets of $2.4 billion, deposits of $2.2 billion, and loans totalling $2.1 billion, according to figures contained in an annual report.

Davey attributed the growth to a two-fold focus on launching technology and reinvesting patronage dividends into financial products, such as its higher-interest savings accounts.

The latter strategy means members reap small benefits throughout the year, rather than receiving a single annual reward, and Davey said members are warming to the shift, first implemented three years ago.

"But it is an education process," he added.

ACU is also witnessing what Davey called a "vast increase" in technology use, resulting in fewer visits to local branches.

"Right now about 90 percent…of transactions are completed electronically," he said.

"Five or six years ago, that would have been in and around the 78 to 80 percent range."

As that figure continues to rise, Davey said the board will "search for a better way to have that contact with membership."

"It certainly could have an effect on the number of branches we hold," Davey said.

In 2019, ACU—which has branches in Grunthal, Morris, Vita, Sprague, Emerson, and Dominion City—will also reassess its brick and mortar locations.

Davey acknowledged that maintaining branches in small communities is "something that our board is wrestling with."

If any changes were proposed, "I would imagine that we would hold town hall meetings," he said.

For now, the board is navigating the gradual rollback of a longstanding special deduction that Finance Minister Cameron Friesen said will save the province $800,000 this year.

Beginning Jan. 1, 2019, the tax credit will be reduced by 2.5 percent annually.

For the past 45 years, Manitoba credit unions could claim the deduction, originally intended to level the playing field as upstart credit unions began competing with chartered banks.

It departs just as financial institutions are also being squeezed by regulators who want to see them hold more equity in the wake of economic recessions.

For ACU, Davey estimated the removal of the credit will amount to a hit of $4 million over five years.

As a result, ACU will double down on its technology offerings to further decrease the cost per transaction, he said.

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