REGINA - Now it is up to the members to decide.
News broke this past week that the boards of Conexus Credit Union, Cornerstone Credit Union and Synergy Credit Union are formally recommending to members that they merge into a single entity.
If it happens, it will be Saskatchewan’s largest credit union, spanning east to west with 57 branches in 50 communities. Conexus is based out of Regina, Cornerstone out of Yorkton and Synergy out of Lloydminster.
But now it’s up to the members to decide, with voting to be held this spring. Each credit union will need a 75 per cent yes vote for the merger to proceed.
Conexus’ board chair Ken Kosolofski is urging members to have their say.
He expects a member vote is “going to happen sometime in June. We haven't firmed up the dates. We are basically going to be having a meeting with our members as well, probably sometime in May, and we ask members to take part in this. They're shaping the future of this credit union. They're shaping the future of the credit union system in Saskatchewan. So we want our members to take some interest in it and to actually vote.”
It was last November that Conexus, Cornerstone, and Synergy Credit Unions initially announced they were exploring the merger.
“We have done all of our due diligence,” said Kosolofski. “We put together a business case. We've worked hard with our lawyers and our regulators to get to a point where we have a business case that was approved by all three boards, and we're recommending it to our members.”
Celina Philpot, CEO of Conexus Credit Union, said that the finished merged entity would “combine approximately $15 billion in assets under management with 57 branches located throughout the province, that's north to south, east to west,” and 1,400 employees.
Philpot said the exploration phase consisted of due diligence to understand risks and opportunities and the regulatory requirements.
From the due diligence, “we worked into the next phase, which was a detailed business case. And that's where we explored financial projections, understanding what the new entity would look like, understanding where we come from, and then putting that information in at forward-looking with all the kind of information from the due diligence, our kind of assumptions, and built out what would those financial projections look five years out from this merger.”
That information, she said, “answered a lot of our questions and proved out to us that the newly merged entity would be a strong entity. So collectively, we would be a very strong financial institution with capacity to be able to serve our members today and into the future. So that's what we were able to discern.”
Kosolofski said that from the board's perspective, “we were looking for, are there any red flags? You know, all three of these credit unions are pretty strong financially. They have good capital base, but are there some red flags that we should be concerned about? There was no red flags.”
The other issue, he said, was wanting to make sure this was a benefit to their members. He said this was important to all three boards.
“So we're very, very concerned about our members, 200,000 members, a large swath of Saskatchewan. We want to make sure that we're very careful and that we were very diligent in putting together what was required to do this merger.”
The credit unions have issued a news release with 10 commitments to members about the new entity.
Those commitments include a Modern digital banking experience, a combined branch network with no overlap, competitive banking with low to no-fee options, profit-sharing with members, local service and local decision-making, enhanced lending capacity, specialized expertise, personalized service and modern offerings to meet diverse needs, making sure profits stay local, and a commitment to employees.
Should the members vote yes the target date for the new Credit Union to be up and running is Jan. 1 of 2026. That is the earliest legal date in which they can begin, according to the Competition Bureau. A new board will be set up for the new Credit Union and a name chosen, as well as a new CEO appointed.
As much planning will be done in advance of that date, but it is expected the full transition would take place throughout 2026.
But first, the three credit unions need to get the merger across the finish line with members.
Philpot said that to get it approved, they will need to “lean into our members collectively as three partners and expressing, again, that solid recommendation coming from our board that was unanimous. And then just listening to our members.What are they concerned about? The ten commitments that we had issued in our press release was in response to what we learned from our members during a survey that we conducted earlier on in the year. We just wanted to understand the sentiment where people were at with even the thought of us exploring a merger. So we got lots of really good insight that we used, rather, to build out our commitment.”
“There’s some work to do,” Kosolofski said of the mood of members.
“They don't know what this actually means. If you look at the broader credit union system, we are seeing lots of mergers across Canada. You know -- lots in Manitoba; a big one that happened last year, Servus Credit Union in Alberta that has 85 of the credit union members in Alberta under that banner; and recent announcements in B.C. So mergers are a thing that's happening in the credit union system for a variety of reasons...
“But, you know, the mood of the credit union system is good. The mood of our members, they're cautious and rightfully so, and that's why we need to spend some time making sure that they're satisfied with what we've done and they want to vote in favour of it.”
“When we did our initial survey with members, it was just under the messaging of, hey, we're exploring this,” said Philpot.
“And a lot of the sentiment from our members was, speaking on Conexus members only: 'you know, that sounds interesting. Looking forward to learning what you learned, and get back to us and tell us what you find out.' So I think there was some optimism, with still a little bit of, ‘I'm going to reserve the right to tell you whether I think it's positive or not, because I don't have all the information yet,’ so we're committed to doing that. But I think generally, even when we just reached out in early January, it was positive... There's a lot of consolidation happening in the system. And really for credit unions, we know we have a task to compete against the ‘Charters’ in our own province, and we believe coming together would give us that opportunity to be strong in our messaging, to enable us to be differentiated in market, so that we can provide a really strong alternative to the chartered bank.”
Philpot said the merger was really 小蓝视频 driven by "hyper-competition" not only from traditional banks, but also 'fintechs' wanting to have access to the Canadian market.
“So we're in the financial institution industry, but our members compare us to their experience with, say, an Amazon. So their expectations are changing and becoming more robust, and we have to, in kind, deliver a service experience that meets that expectation, and it's customized and personalized to a certain extent. So that is the challenge, and we believe by coming together and working on these items together, we could go further.”
