Saskatchewan Credit Union Difference - saskcu.com

1 Saskatchewan Credit Union of Contents Message from the President and CEO .. 3 Credit Union System .. 4 Fair Taxation for Saskatchewan Credit Unions .. 5 Financial Literacy .. 9 Credit Union Impact Our Difference ..11 GIVING BACK in Hundreds of Ways ..14 Saskatchewan Communities Served by Credit Unions ..153 Message from the President and CEOThe Saskatchewan Credit Union system is pleased to share the enclosed information with elected officials throughout Saskatchewan . The messages contained herein reflect the collective voice of 55 Saskatchewan Credit unions that serve 502,000 members in 264 communities throughout the province.

2 This information is intended to increase your awareness about the distinct Credit Union Difference , in particular our concern respecting Credit Union taxation .We know the provincial government is committed to ensuring small-medium sized businesses can compete and thrive within Saskatchewan . Not only are Credit unions independent small-medium sized businesses, we also provide commercial lending to close to 50% of the small-medium sized businesses in Saskatchewan . A recent report from the Canadian Federation of Independent Business found that Credit unions came out on top for serving entrepreneurs in the areas of financing, fees, experience with account managers and service.

3 Earlier this year, the federal government, without consultation, announced changes to the Credit Union federal tax regime . We understand this means the provincial government will be reviewing the changes and considering how to respond . Any change to the current Credit Union tax regime will negatively impact Credit unions ability to exist as second tier financial institutions throughout Saskatchewan . This also means potential changes Credit unions may need to consider could include: reduced community investment, streamlined operations which could impact employment, changes in pricing, reduced growth to manage capital constraints and reduced investment in innovation and development.

4 Saskatchewan Credit unions evolved during the 1930s by providing financial services to people who were unable to obtain loans through mainstream banks . Since then, Credit unions have not only served as a financial service option to communities throughout the province, Credit unions have also proven to be a pillar of stability for Saskatchewan during good times and bad . Our long history of working with community leaders and elected officials to support the social and economic fabric of Saskatchewan is something we are inherently proud of.

5 We look to the Government of Saskatchewan to recognize our unique model, our purpose and commitment to the Province of Saskatchewan . We further ask the Government of Saskatchewan to advocate for and support our request to maintain the current tax regime for Credit unions and not impose a combined 14% taxation rate increase for Credit unions .In the coming weeks, Credit Union representatives will be taking steps to contact you to discuss this important issue of taxation . We look forward to the participation of government in these discussions to ensure continued strength of Credit unions and economic success of Saskatchewan .

6 Sincerely,Dean Walde, President of the Board Keith Nixon, Chief Executive Officer Credit Union Central of Saskatchewan Credit Union Central of SaskatchewanJune 20134 Saskatchewan Credit Union SYSTEM Credit unions: 551 Credit Union locations: 297 Number of communities served: 264 Members: 502,413 Employees: 3,479 Total assets: $16 .9 billion Agricultural loans: $2 .0 billion Commercial loans: $3 .5 billion Consumer and residential loans: $6 .6 billion CANADIAN Credit Union SYSTEM Credit unions: 348 Credit Union locations: 1,762 Members: 5.

7 3 million Employees: 27,500 (approximate) Total assets: $152 .5 billionCredit Union SystemVISIONB uilding lives, fulfilling dreamsMISSIONHelp our communities thriveVALUESH onest, Trustworthy, Co-operative, EnterprisingSaskatchewan Credit unions are committed to building financial well-being and growing communities through a common vision, mission and values . 1As of January 1, 2013As of December 31, 2012 unless otherwise stated .All figures have been rounded and are current as of December 31, 2012 unless otherwise indicated.

8 5 Fair Taxation for Saskatchewan Credit UnionsThe federal government recently changed the Credit Union tax regime . We understand the provincial tax regime currently mirrors the federal regime . As a result of the changes, the Government of Saskatchewan will be reviewing the changes and considering how to respond .Our Ask: The provincial government is committed to ensuring small medium sized businesses can exist, grow and compete within Saskatchewan . We ask the provincial government to maintain the current tax regime for Credit unions.

9 Any change to the tax provision will impose a 14% rate increase for Credit unions or approximately an additional $10 .6 million per year . The current tax provision in the Income Tax Act, 2000 achieves the following: Recognizes Credit unions as provincially regulated small sized financial institutions in comparison to banks Recognizes the requirements placed on the financial sector to increase capital standards and the reliance of co-operatives on retained earnings as their primary source of capital Maintains a tax regime that considers the co-operative business model and its democratic governance Considers the Credit Union impact and the maintenance of the robust Credit Union system that provides an alternative to

10 The large national chartered banks Enables Credit unions to continue to support the growing economy in Saskatchewan through their support of small and medium sized enterprises and provision of small business financing optionsCredit unions are not the same as banks . Credit unions are different in purpose, ownership and operation from other financial institutions . The 55 Saskatchewan Credit unions are each independent financial institutions . Any change to taxation overlooks the unique Credit Union business model and the important role Credit unions play in Saskatchewan and throughout Canada.