Frequently asked questions
What does OSFI, BCFSA, CUDIC, CDIC and FCAC stand for?
OFSI– Office of the Superintendent of Financial Institutions
BCFSA– BC Financial Services Authority
CUDIC– Credit Union Deposit Insurance Corporation
CDIC– Canada Deposit Insurance Corporation
FCAC– Financial Consumer Agency of Canada
Why should I vote in favour of becoming a federal credit union?
A YES vote is a vote to keep the good thing we have today growing for future generations. It is a vote to strengthen and preserve our local ties and community investment and power this presence with greater scale and investment in technology. It’s a vote to give your local credit union more options for responsible, thoughtful growth and it’s a vote to level the playing field so that we can compete fairly with fintechs and banks that do not face the same restrictions that we do.
Here’s the key: As a federal credit union, we’ll be stronger because we’ll have opportunities to grow and remain relevant today and for future generations. We’ll be in a better position to thrive no matter what the future holds. We’ll be able to keep a good thing growing.
We’ve been successful at preserving local decision-making and remaining connected in our communities while also leveraging the strength of our collective size. Together, Island Savings, Envision Financial, Valley First and Enderby & District Financial have been able to provide more value for members than they could have on their own.
Consider our Simply Free Account® as an example, which saves members approximately $200 in banking fees every year. We never could have offered that as a standalone credit union. It’s our collective size as First West that has enabled us offer this to our members for several years now.
To learn more about our six important reasons to become a federal credit union, click here.
Why can’t First West do business outside of British Columbia today?
Provincial credit unions are legislatively restricted from providing core banking services beyond provincial borders. This means First West members must use another financial institution to meet their financial needs outside of B.C. Federal continuance allows a credit union to serve its members anywhere in Canada, while retaining its co-operative roots and credit union values.
Today, your credit union must compete with fintechs and banks that don’t have the same geographic and regulatory restrictions we do. They can easily operate in B.C., across Canada and beyond. It is not a level playing field and this puts us, and our members, at a disadvantage as we work hard to keep pace with technological changes and the investments needed to anticipate our members’ needs of the future.
How does First West intend on staying true to its co-operative values once federally regulated?
Our federal journey is about keeping the good thing we have today growing for our members tomorrow and that means that our co-operative values will stay front and centre in all we do.
Democratic cooperative structure
If First West becomes a federal credit union, it will remain a cooperative. In fact, the governing federal legislation (the Bank Act) states that a federal credit union “is organized and carries on business on a co-operative basis.” This means members of First West as a federal credit union will retain the right to vote on big changes to the way the credit union is structured, such as changes to the Bylaws* and whether to amalgamate with another credit union in the future. As a credit union member, you will also continue to nominate and elect representatives to the First West Board of Directors.
*The Bylaws will replace our Rules if First West becomes a federal credit union.
How we treat our members reflects who we are—our culture and co-operative spirit. While regulations will change, our belief in neighbour-helping-neighbour won’t. We’ll continue our commitment to keeping members at the heart of everything we do.
Local decision making
One thing that sets First West apart from the big banks is that we make decisions as close to our members as possible This will remain the same.
We are deeply committed to supporting and nurturing the communities we operate in, whether by providing sponsorships and donations, supporting the local economy through employment and procurement or through our social vision, Lead Well, enabling employees to give back with hearts, hands and minds. This commitment will not change when we become a federal credit union. Since First West was founded in 2010, we’ve given back more than $28 million to local charities and causes in our communities. Additionally, our increased scale and strength has meant that we’ve been able to provide much needed support and investment in our communities during the pandemic, at a time when so many needed it most.
Can I expect changes to my products and services?
We will continue to offer the products and services members value, such as our Simply Free Account® and Unlimited Chequing for Business®.
Over the years, First West has also harnessed our increased size to keep hard-earned money in our members’ pockets by introducing best-in-class products like our Simply Free Account® and Unlimited Chequing for Business®. Our commitment to providing superior products and advice won’t change.
If First West becomes a federal credit union, a small percentage of members will be impacted by our deposit insurance provider changing from the Credit Union Deposit Insurance Corporation (CUDIC) to the Canada Deposit Insurance Corporation (CDIC). We invite you to look at more detailed information on deposit insurance changes, found here.
Will my local division’s name change?
No. First West’s members love doing business with the familiar names they have known for years: Island Savings, Envision Financial, Valley First and Enderby & District Financial. These names will remain the same.
What will change as a result of becoming a federal credit union?
We will be able to operate across Canada
As a provincial credit union, First West can only conduct its core banking business within B.C. Becoming a federal credit union will open doors for future opportunities and choice, presenting us with the opportunity to conduct business across Canada.
We will be regulated federally and not provincially
First West is currently regulated provincially by BC Financial Services Authority (BCFSA). Federal credit unions and banks are governed by and organized under the Bank Act and regulated and governed by Office of the Superintendent of Financial Institutions (OSFI), Financial Consumer Agency of Canada (FCAC) and CDIC.
Federal credit unions receive some of the highest levels of prudential oversight afforded to financial institutions in Canada. Stringent regulatory requirements protect our members’ interests and help us continually strengthen and improve our practices.
Your deposits will be protected by a different deposit insurance program
Today, members’ deposits are insured by CUDIC. If First West becomes a federal credit union, members’ eligible deposits will be insured by CDIC, the same organization that protects Canadian banking customers’ eligible deposits. CUDIC and CDIC have different levels of coverage. For more information and a list of eligible deposits, click here.
Where will First West be headquartered?
First West will remain headquartered in B.C. In recent years, we have reaffirmed our commitment to B.C. and our communities by making several significant investments into our regional office spaces, most notably the construction of a brand–new head office located in Langley, a significantly renovated regional office in Penticton, and new regional offices in Kelowna and Victoria.
How does First West plan to grow as a federal credit union?
Meeting our members’ out-of-province needs through our existing branch network
For many members, business and personal lives extend beyond B.C., whether through out-of-province job transfers, new business opportunities, children attending university or aging parents in other regions of the country. We can continue to serve our members and meet their needs outside of the province more fully by becoming federally regulated.
Serving Canadians outside of our branch network through digital channels
Members use and expect more digital solutions to manage their finances. Not surprisingly, the COVID-19 pandemic has accelerated the demand and preference for more non-physical service options. These technologies and digital solutions, however, require significant financial and resource investments by the credit union. To achieve a reasonable return on investment for digital innovation, we would benefit from access to the larger Canadian market.
Merging with other like-minded credit unions who see the value in First West’s business model
We do not intend at this time to grow across Canada by building new branches in communities outside of B.C. However, new branches in other provinces may be added to First West’s branch network through any successful merger with other like-minded credit unions.
- Becoming a federally regulated credit union presents more growth opportunities, putting us in a position to leverage those opportunities— granted, that doesn’t necessarily mean that we will act on them immediately. As we have always done, we will make strategic, measured decisions ensuring they make good sense for our members, employees, and communities.
How will becoming a federal credit union impact employees?
Our regulatory environment doesn’t change the things that make us who we are. Things like our culture, values and how we treat our members and employees will always be within our control. Through both First West and our predecessor credit unions, we have a 75-year track record showing an unwavering commitment to building a values-based culture where employees feel respected, included, and heard— this is never going to change. Cooperative principles, democratic member ownership and employee empowerment are in our DNA.
As a federal credit union, there may be small changes in day-to-day tasks or processes for certain employees, but change is nothing new for our organization. Whether the change is because of federal regulation or strategic decisions we make as an organization, employees can be confident knowing that they will be given the tools, resources, and training to ensure their continued success.
Becoming federally regulated expands our horizons, opens us up to future opportunities, and better enables us to ensure long-term viability and financial strength, all of which have a direct impact on future career growth and opportunities. In a fast-changing world where disruption is constant and jobs and skills are continually changing, becoming a federal credit union puts First West in the best possible position to continue growing and thriving, thereby increasing our ability to provide meaningful work for years to come. It also expands our talent pool and enhances our ability to attract and retain employees who have the experience and, in many cases, specialized skills to steward our members’ business with us.
What are some of the key milestones for becoming a federally regulated credit union?
The process to become federally regulated includes several stages and decision points along the way. Some of the major milestones and decision points include:
- Board of Directors asks management to analyze the risks and opportunities of becoming federally regulated (Completed, July 2017)
- First West submits pre-application to OSFI (Completed, Nov. 2018)
- OSFI reviews pre-application and begins initial round of bi-weekly meetings with First West (Completed, Feb. 2019)
- OSFI holds business plan review session with First West and issues Expectations Letter to First West board of directors (Completed, Dec. 2019)
- Board of Directors considers Expectations Letter and decides whether to present special resolution to membership (Completed, Jan. 2020)
- Members vote on federal continuance
- First West submits application to BCFSA and CUDIC
- BCFSA undertakes public consultation
- BCFSA and CUDIC considers First West’s business case for continuance. First West requires BCFSA and CUDIC consent to proceed.
- First West submits formal application to OSFI
- If the application meets the requirements as per the Bank Act and all applicable regulations and guidelines and all necessary capital, technology, policies and processes are in place, the federal Minister of Finance will review the application and render her or his decision on the issuance of the Order for Letters Patent of Continuance.
- If the Minister approves the application, First West Credit Union will commence its operations as a Federal Credit Union
What are the risks of NOT becoming a federal credit union?
Below you’ll find a summarized version of the risks associated with not becoming a federal credit union. To view detailed information about the risks of not becoming a federal credit union, click here.
Competitive pressure and declining growth opportunities
First West’s provincially tied operations hinder our ability to grow and compete more effectively in Canada’s financial services industry. Declining growth opportunities will challenge our ability to invest effectively in product and service innovation, improved member experiences and community giving.
Loss of existing members and irrelevance to potential new, younger members
First West is at risk of losing existing members and becoming irrelevant to potential new members, particularly younger ones, if it is unable to stay ahead of the financial technology curve and offer innovative digital tools, services and experiences.
First West anticipates that the sizeable growth it has achieved in the past 10 years will eventually slow if the credit union’s offerings are restricted solely to B.C.’s population. Becoming a federal credit union will enable First West to continue to grow by entering new markets through the acquisition of credit unions outside B.C.
Susceptibility to the effect of provincial economic downturns
First West faces a significantly higher degree of concentration risk than financial institutions with assets and operations in multiple provinces because First West’s success depends on a single provincial economy. This makes the credit union more susceptible to the effects of provincial market downturns or corrections, natural disasters or other localized business disruptions.
Unlike Canada’s federal regulatory bodies, many provincial regulators, including BCFSA, have not yet advanced in implementing leading global regulatory standards like the Basel III International Regulatory Accord. When provincial regulators eventually do adopt these standards, as is very likely to occur, credit unions like First West will face increased regulatory burden in a marketplace with few offsetting growth opportunities.
Employee acquisition and retention
As a provincial credit union, both the higher cost of living (especially housing) in First West’s trade areas and the higher concentration of specialized banking talent in Ontario and Quebec present challenges to acquiring and retaining specialized employees.
What are the risks of becoming a federal credit union?
Below you’ll find a summarized version of the risks associated with becoming a federal credit union. To view detailed information about the risks of becoming a federal credit union, click here.
Liquidity and funding
A change in deposit insurance coverage may prompt members to withdraw their deposits from First West, which could reduce the credit union’s liquidity and inhibit its ability to meet its financial obligations. A reduction in deposits that is not offset by new deposits or other measures would cause First West’s liquidity to diminish.
Extending member service beyond B.C.
As a federal credit union, First West will be positioned to serve members as they move, grow and expand their personal and/or business interests across Canada. We intend to invest in technology and digital solutions to serve these members effectively. It may take more time than anticipated to put these solutions in place and attract new members. To mitigate this risk, First West will develop and execute carefully designed business plans that balance cost with the goals of acquiring new personal and business members.
Through the process of becoming a federally regulated financial institution, there is a risk the credit union will be unable to meet regulatory requirements or that meeting regulatory requirements might prove costlier than anticipated
First West could experience delays in the federal continuance process should compliance with federal and provincial legal and regulatory requirements prove more challenging than anticipated. First West has flexibility in its target date for federal continuance and is well prepared to handle delays in the process.
Managing the transition to federal regulation
Operating under federal regulation is new to First West Credit Union. There is a risk that we may not have the organizational capacity or expertise required to successfully transition to becoming a federally regulated credit union.
Membership and regulatory approval
In addition to member approvals, regulatory approvals from the following governing bodies are also required:
- Federal Minister of Finance
Should First West fail to obtain any of these approvals, it will continue serving its current membership while remaining within B.C.’s provincial regulatory framework.
Voting (Voting is now closed)
Who is eligible to vote?
To be eligible to vote, you must be a member in good standing as of June 30, 2021. This means you must be 19 or older, hold a minimum of five Class A Membership Equity Shares and not be more than 90 days delinquent in any obligation to the credit union.
When is the voting period?
Voting will begin at 9 AM (PT), Nov. 1, 2021, and close at 11:59 PM (PT), Nov. 21, 2021. All mail-in ballots must be received by our third-party counters by Nov. 19, 2021.
What are my options to cast a ballot?
Eligible members have four ways to vote:
- Online (desktop and mobile banking app)
- Text message
- By mail upon request
The electronic voting methods listed above are easy to use, secure and accessible. These voting methods also provide convenience and gives members the flexibility to vote from wherever they choose.
Earlier this year, almost one thousand First West employees tested these voting methods and provided feedback on their experience. This feedback was incredibly valuable and has been used to ensure our members have a positive voting experience.
Can I vote in-branch or drop off my ballot at a branch?
Yes. Although it is preferred to have you cast your vote online, by text message or by telephone, every branch should be set-up with a tablet where you can cast your vote with the help of branch employee. You may request a mail-in ballot by calling our Member Outreach Team toll-free at 1-888-921-0580 (Mon. – Fri. 9 AM – 5 PM, PT) for assistance. Paper ballots can be deposited at any Canada Post mailbox.
I have more than one account— may I cast more than one ballot?
Each member in good standing who holds a minimum of five Class A Membership Equity Shares may cast one ballot, regardless of the number of accounts or memberships he or she holds.
I also hold class B equity shares— am I eligible to vote for this class of shares?
Each member who holds Class B Equity Shares may cast two ballots: one for the Class A Membership Equity Shares held and one forthe Class B Equity Shares held.
I have a business membership— how can I vote?
Can someone else vote on my behalf?
First West’s rules do not allow individual members to vote by proxy. As noted above, however, a business or organization must assign a non-member to vote on its behalf.
My voting information isn't working— what do I do?
Contact us toll-free at 1-888-921-0580 (Mon. – Fri. 9 AM – 5 PM, PT) for assistance.
I don't want people to know how I voted— how are you protecting my privacy?
All ballots are retained and counted by a neutral, third-party agency under the supervision of a returning officer who is not a First West employee. Following the ballot count, the returning officer will ensure all paper and digital ballots are destroyed.