The Skytrain travels underneath the Vancity Credit Union headquarters, in Vancouver, in an undated file photo.Jeff Vinnick/The Globe and Mail
Vancity, Canada’s largest credit union, is looking to fill gaps in small and niche markets after two of the country’s big six banks made large acquisitions in Western Canada, the chief of the Vancouver-based financial institution said in an interview.
Canada’s highly regulated banking sector has been further consolidating since No.1 lender Royal Bank of Canada RY-T bought HSBC’s domestic operations for US$13.5-billion and National Bank NA-T proposed to buy Canadian Western Bank CWB-T for US$5-billion in the past year.
The acquisitions, and other deals in the credit union space, reduce the number of options for consumers in Western Canada, Vancity’s CEO Wellington Holbrook said in an interview.
“That’s why I think there is a huge opportunity for credit unions, in general, to step up and fill that void,” he said on Tuesday.
Had they not been acquired, HSBC would have been the largest headquartered financial institution in British Columbia while Canadian Western Bank would have been one of the largest in the region.
British Columbia-focused Vancity, which has nearly 600,000 clients and US$36-billion in assets, is now investing in technology to help it scale its operations and compete with the big banks.
Canada’s banking space is largely dominated by the big six banks while smaller banks and credit unions hold a small share of the market focusing on specific provinces.
Mr. Holbrook, who took charge in January of this year, has slashed jobs to cut costs after the company reported an annual loss for 2023.
He said 2025 will be the year of investing to build its technology platforms to capture market share in everyday banking, small and medium sized business banking in British Columbia.
“We can be small enough to fill the niches,” he said, noting that the large banks could find it challenging to cover every niche and unique needs in local markets.