Spectra Credit Union explained its proposed partnership with Affinity Credit Union during a membership meeting March 18.
Spectra CEO Tim Schroh, vice-president of finance Cory Prokop and board chair Wayne Amos discussed the benefits of Spectra coming together with Affinity. Several Affinity representatives attended the meeting.
The meeting emanated from Spectra's head office in Estevan, and was broadcasted to branches in Carlyle, Carnduff, Oxbow, Redvers and Minton. Spectra members and employees were in attendance at each branch.
Only one person spoke up during the question-and-answer session, and it was more of a statement, as he said that the partnership would only benefit about five per cent of Spectra's membership.
Schroh countered that the partnership would give Spectra's members access to banking services in Regina and Saskatoon, and it would improve Spectra's financial position, while allowing it to offer more products and services.
He said he expected more questions during the meeting.
“Maybe it's a sign of the times, because partnerships, mergers and amalgamations are so commonplace now,” said Schroh. “I think it also speaks a lot to the process that the board went through in terms of setting those guiding principles, and digging into those guiding principles through due diligence.”
There haven't been many concerns or support about the partnership, he said. People have told him that they think the partnership is a done deal.
But if it doesn't receive 75 per cent support from the members, and two-thirds support from the investment shareholders at Spectra's annual meeting on April 8, then it won't proceed, and Spectra will continue to operate on its own.
Schroh noted that Spectra's board first discussed amalgamating with another credit union in 2009. But it wasn't until 2011 when serious discussions began, thanks to issues related to a surge in assets at the credit union.
The partnership would allow Spectra to loan more money to clients. Currently their cap is $12 million.
"We have a lot of commercial clients who are starting to require more than that amount," said Schroh.
Also, only 65 per cent of their loan portfolio can be in commercial and agriculture departments, and much of their loans are tied up in those two areas.
A partnership with Affinity would solve these problems.
The meeting April 8 will start at 7 p.m. with the annual general meeting. Afterwards, Spectra will again offer their rational for the partnership with Affinity. Members will then have their chance to vote.
Results of the vote will be known that night.
Advantage Credit Union out of Melfort is also seeking a partnership with Spectra, but Spectra's proposed partnership with Affinity is independent of Advantage's. If Spectra's members approve the partnership, but Advantage's members don't, Spectra and Affinity would still come together.