Northeastern B.C.'s North Peace Savings and Credit Union is moving into the northwest.
Placing a business account manager in Terrace who, for now, will work out of his or her home, is being described as a modest first step.
“We're starting from zero and will build from there,” said North Peace chief executive officer Mitchel Chilcott this week.
The decision has been two years in the making and is meant to diversify North Peace's business out of northeastern B.C. which is heavily reliant on the fortunes of the oil and gas industry.
Chilcott said the move is intended to spread the risk and so provide North Peace with more than one geographical area of operation.
“We see a lot of similarities with Terrace. It has small businesses and there's an entrepreneurship which fits in with our members and values,” he said in explaining North Peace's attraction to Terrace and area.
“Credit unions in B.C. are provincially regulated so we could not go into Alberta and the Yukon is to the north,” he said.
There are no geographic limitations imposed on B.C. credit unions – Kitimat's credit union is Envision, a branch of a larger Lower Mainland credit union and Chilcott noted that Northern Savings moved into Terrace from Prince Rupert, eventually absorbing the former Terrace and District Credit Union.
“In selecting Terrace (skipping over Prince George and the Cariboo) we looked at such things as demographics, state of the completion, industry composition and longer term economic outlook. Terrace also has the advantage of location, in that service can be provided to the Prince Rupert and Kitimat areas from there as well. Although there are no plans for further expansion at this time, once Terrace is successful, it could be leveraged to act as a hub for service into other communities,” Chilcott said.
“The Lower Mainland is a free-for-all,” Chilcott noted of credit union competition down there.
Chilcott hopes North Peace can hire a local person who is already familiar with the area.
Formed in 1947, North Peace Savings and Credit Union has more than 13,300 members, an asset base of $492 million and branches in Fort St. John, Fort Nelson, Hudson's Hope and Taylor, the latter location being 180 square feet in size with just one employee and a video connection to its other branches.
Last November it announced it will open a small office in Dawson Creek.
While North Peace Savings contemplates expansion into the northwest, Northern Savings Credit Union late last year announced it was scaling back operations outside of the region
They called the move one of prudent risk management, done despite Northern Savings having built up a healthy mortgage business down south over the years, with that value growing to $450 million—a substantial portion of the credit union's asset base last year of just under $1 billion.
Selling approximately $150 million of those mortgages would reduce the exposure of Northern Savings down south and bring the value of that asset more in line with its overall asset base.