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Winnipeg Free Press - PRINT EDITION

It's credit union country

Banks take second place in hearts of Manitobans

By: Martin Cash

Posted: 12/29/2010 1:00 AM | Comments: 0 (including replies)

JOHN WOODS / WINNIPEG FREE PRESS Enlarge Image

Credit Union Central on Donald Street.

In Manitoba, credit unions have bootstrapped their way to a 40 per cent market share, a huge position in a country where the Big Five banks dominate the banking sector like almost nowhere else in the world.

So it's probably not too surprising that a recent Jory Capital/Winnipeg Free Press survey of 1,001 Manitobans conducted by Probe Research shows the rate of customer satisfaction among credit union customers is 10 per cent higher than among the province's banking customers.

The percentages

Customers who are "very satisfied" with their primary financial institution:

74 per cent -- credit unions

64 per cent -- banks

73 per cent -- ScotiaBank

69 per cent -- BMO

65 per cent -- TD Canada Trust

64 per cent -- RBC

54 per cent -- CIBC

Primary financial institutions of respondents:

22 per cent -- RBC

11 per cent -- CIBC

10 per cent -- TD Canada Trust

8 per cent -- ScotiaBank

7 per cent -- Assiniboine Credit Union

4 per cent -- Steinbach Credit Union

4 per cent -- BMO

3 per cent -- Cambrian Credit Union

19 per cent -- other credit unions

2 per cent -- other bank/financial institutions

12 per cent -- not stated

-- Source: Probe/Jory Capital/Winnipeg Free Press poll

Manitoba's largest

Largest Manitoba Credit Unions (by assets under administration as of the end of the second quarter, 2010):

Steinbach Credit Union -- $3 billion (7th largest in the country)

Assiniboine Credit Union -- $2.7 billion (8th largest in the country)

Cambrian Credit Union -- $2.1 billion (10th largest in the country)

Access Credit Union -- $1.24 billion (22nd largest in the country)

Crosstown Civic Credit Union -- $1.15 billion (24th largest in the country)

-- Source: Credit Union Central of Canada

The survey, conducted by Probe at the end of November and early December, showed that while the banks are doing a good job, credit unions are doing a better job of making their customers happy.

Among credit union customers, 74 per cent said they were very satisfied with their primary financial institution as opposed to 64 per cent of banking customers. Including those who are somewhat satisfied, credit unions narrowly scored higher than the banks at 97 per cent to 95 per cent.

Glenn Friesen, CEO of Steinbach Credit Union, the largest of Manitoba's 41 credit unions, said the Probe numbers corroborate market research SCU does annually or every other year.

"Customer satisfaction is something we work hard at," he said. "These are our members. It's different than shareholders and customers with the banks. We have members who actually own the credit union."

Manitoba is home to three of the country's 10 largest credit unions -- Steinbach, Assiniboine and Cambrian -- and credit unions' total assets under administration of $17.2 billion has been growing steadily.

"I don't know how these numbers compare to other parts of the country, but I have always felt that Manitoba is a credit union place," said Scott MacKay, president of Probe Research. "Ten years ago people might have said it's a rural thing, but it has become a city thing now."

In fact, the survey shows people in the city are more inclined than those outside it to change to a credit union if they were forced for some reason to switch to a new financial institution.

Overall, a slightly larger percentage of Manitobans -- 45 per cent -- would switch to a credit union as opposed to 37 per cent who said they would switch to a bank. In Winnipeg, the migration to the credit unions would be even greater -- 50 per cent, compared to 33 per cent to banks.

For those who are already credit union customers, 60 per cent would switch to another credit union, but only 47 per cent of bank customers would switch to another bank, according to the survey.

"Their loyalty and customer service trumps the banks," said Patrick Cooney, CEO of Jory Capital, one of the sponsors of the survey. "That is a big spread. It's significant."

The survey of 1,001 Manitobans is considered accurate plus or minus 3.1 percentage points 95 per cent of the time.

Although SCU's Friesen says credit unions have 40 per cent of the Manitoba market, 31 per cent of respondents to the Probe poll said credit unions were their primary financial services provider but 55 per cent it was a bank.

Despite the success and growth of credit unions in Manitoba, the big banks obviously have a strong and successful presence.

Andrew Addison, a spokesman for the Canadian Bankers Association, said the banks also work hard at providing top customer service.

The Probe poll asked respondents to disclose the name of their financial institution, showing a wide band of market share among the banks.

RBC is the largest at 22 per cent and BMO is the smallest at four per cent, the same share of the total market enjoyed by SCU.

martin.cash@freepress.mb.ca

Republished from the Winnipeg Free Press print edition December 29, 2010 B9

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