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A ban on common sense: Voicing our concern and opposition through advocacy

November 23, 2017

Jessica Brandon-Jepp, Government Relations and Advocacy Advisor, Canadian Credit Union Association

Update on our Hike the Hill issues
A record number of Hike the Hill meetings last month has helped to advance three key issues in Ottawa. Here's a look at the current state of each.

Use of banking terms
During Hike the Hill, credit union advocates asked legislators to urge the minister to amend the Bank Act to give credit unions clarity and future assurances on the use of the verbs "bank" and "banking."

Since then, Minister Morneau appeared before the House Finance Committee and stated that his approach "…will allow us to ensure that [credit unions] can maintain the appropriate usage of terms that customers have come to associate with their business." (See the video starting at the 16:56:54 mark)

The Minister's statement is a positive sign, but it doesn't resolve the issue yet. CCUA has engaged in productive discussions with his office since his committee appearance, and believes that the signal he sent is a deliberate one that should result in a positive announcement in the months ahead.

In the meantime, we encourage all credit unions to continue to update their legislators on this issue. MPs will return to their ridings in mid-December. Give yours a call and remind them that credit unions want clarity on this issue early in the new year.

'Right-sizing' financial sector policy
CCUA is has been working to advance the idea of "right-sized" or proportional regulatory approaches that will better suit the undersized risk and realities of credit unions and small banks. This is an idea that is being advanced internationally by the Bank for International Settlements and leaders of European banks. It has also formed a key part of CCUA submission to the federal financial institutions framework review and was an ask during Hike the Hill meetings.

Since then, the idea of proportionality was shared once again with legislators in CCUA's presentation to the All-Party Credit Union Caucus meeting on November 7.

Many legislators were surprised to hear that regulation derived from international guidance trickles down to the provincial level to impact smaller, cooperatively-owned institutions. Many were sympathetic to the compliance challenges this creates for credit unions.

While more work needs to be done to popularize the concept of proportionality among MPs, some are already of the view that it should be considered in the context of the federal financial institutions framework review. CCUA encourages you to share our submission with your MPs and continue to stress the importance of further study of this issue in the context of the review.

Mortgage risk sharing proposal
As a result of Hike the Hill, legislators have expressed interest in learning more about the impacts that the government's proposed mortgage risk sharing approach to CHMC-insured mortgages could have on credit unions and, in turn, their constituents, particularly in rural ridings.

As MPs begin to think about re-election, they are acutely aware of issues that will impact their constituents. Many MPs were not aware of the impact of this proposal could have on credit unions' ability to provide mortgage loans in smaller centres.

Risk sharing is still very much at the proposal stage right now, however CCUA recommends that you continue to bring this issue to the attention of your local MP and inform them of the impact it could have in lower cost markets.