Consolidation of the province’s credit union system took a major step forward this week with the approval of a merger involving Conexus, Cornerstone and Synergy. This will create the largest credit union in Saskatchewan when the new entity officially launches on January first.
The push for consolidation is largely driven by the need for scale. When competing with the chartered banks, locally-based financial institutions must keep up with the latest and often expensive technology expenditures smaller units have trouble covering.
But the road to consolidation is not always easy.
Conexus and Synergy once tried a merger with Innovation Credit Union more than a decade ago. Back then, the members of Lloydminster-based Synergy rejected the board recommended consolidation. This time, the membership felt the time to bulk up had arrived.
When the original deal failed, Innovation which was based in Swift Current and North Battleford, went a different direction to become one of the only federally-chartered credit unions in the country, enabling it to operate in more than one province and moved it from provincial regulation to a federally-regulated financial institution.
