Lake View explains decision to reduce branch hours

Trent Ernst, Editor

On June 21, Kelly Longley, CEO of Lake View Credit Union came to Tumbler Ridge to discuss changes to the hours of operation for the local Lake View branch with the Tumbler Ridge District Council. He was joined by Board President Everett Beaulne, Board Vice President John Kurjata and Board Member Joe Judge.

Longley says the credit union has seen a dramatic impact with the oil and gas slowdown and with what’s happening with coal.

“Specifically, in the last two years, we’ve added over two million in loan allowance, and we continue to add because of residential housing foreclosures, business closures and things of that nature” says Longley. “The economic environment we operate in has had a really big impact on us and our members as well.”

The loan allowance is a calculated reserve and is established to pay off bad debts and other credit risks. “It’s income we would have had before and we no longer have,” says Longley. “And it’s us preparing to have to write off loans in the future.”

Much of that is coming from Tumbler Ridge. “When the mines shut down, delinquency doubled. The Loan allowance we set aside for Tumbler Ridge is in the neighbourhood of $1.5 million. The loan allowance for the Credit Union itself is $3 million.”

This means roughly half of the delinquencies are from Tumbler Ridge, says Longley.

Longley says the credit union has to look at what is best for the membership as a whole, not just in Tumbler Ridge, but in Chetwynd and Dawson Creek as well. “We’re hoping the moves we make today will allow us continue to do business in the future. Our members expect us to provide services at a good rates, they expect us to see us keep service charges at adequate levels. If we don’t have our membership, we don’t have a credit union.”

Longley says the Credit Union didn’t want to make these changes. “We didn’t want to make these moves. It’s hard on our staff, it’s hard on the communities. If we had different options, we wouldn’t be making these decisions, but it’s allowing us to move ahead with a lower cost structure.”

He says he’s aware that the credit union is the only financial institution in town, and they have tried to make their decision to meet the town’s needs. “We didn’t make the decision overnight. We chose the times based on when most people come into the branch. There are people who come into the branch at 10 or 10:15, but the reality is we’ve watched our traffic flow, and we believe for the community of Tumbler Ridge, we will be able to provide the services we have in the past with these hours.

Acting mayor Mike Caisley says these decisions go contrary to things that Longley told Council in the past. “A couple years back, when we talked about this, you had indicated that service levels would be maintained,” he says. “Council of the day accepted that fact, but it has proven not to be the case.”

Longley says while the changes in Tumbler Ridge are the most obvious, economics has impacted all three communities. “In Dawson Creek, we’ve announced the lay off of eight people in. We’ve seen our staff count go from 72 to 57 [since February 2014].”

In Chetwynd, they’ve also lost staff by people leaving and the people not being re-hired. “We’ve decreased the staff [in Chetwynd].

“Our organization has changed a lot. We’re probably going to be down to 48 staff members after August. We are trying our best to control our costs, but the economic environment is having an effect in this. If we didn’t have to put that money into loan allowances, we wouldn’t be having this discussion right now. We wouldn’t be laying off people. We are affected, just like many other businesses and we are trying to plan for the future and offer the same services as we have in the past, whether that is through reduced hours or reduced staff.”

Councillor Joanne Kirby says Lake View stood beside the town during last downturn. “We understand that the economy is not good right now and everyone suffers. We’re also trying to stay afloat. When you have a bank that’s cutting hours, it doesn’t look good to people coming in wanting to invest. And we’ve had issues with the bank machine running out of cash; is there any backup for that, as people are going to be banking through the machine more?”

Longley says the Tumbler Ridge ATM has the largest cash limit of any of their ATMs. “It should be no different. There should be no issue.”

But, says Councillor Krakowka, there have been issues in the past. “We’ve had three or four weekends where that machine has gone down. We’ve had tourists stuck in town because they can’t get money.”

Longley says this is something he’s not aware of, but he’ll look into it.

Banking has changed, he says. More people are doing it online. “We are trying to include more technology for our members. Deposit anywhere is something we are hoping to bring on stream. Hoping to enhance our mobile app service. I know it doesn’t do justice to the announcement we’ve made, but there are alternatives for our members. From our standpoint, we’re trying to have the least amount of impact to the community Tumbler Ridge. If there’s a long weekend and it falls on Monday, we’ll be open Tuesday. That is our commitment.”

While they need to work with third-party providers for the online banking issues, Longley says he’s hoping to see these services in place by August, though that is, he is quick to point out, his hope, and not a hard and fast date.

Longley says the board supports keeping service in Tumbler Ridge and they are doing their best to do what they can, but it’s hard to compete with other financial institutions who offer service in town through online banking, but don’t have to provide an actual bank, don’t have to provide staff. “We can’t compete with institutions that have no cost structure here.”

Board member Joe Judge says he was involved with the Regional District when Teck closed Quintette. “At the time, the only financial institution in Tumbler Ridge closed their door and left,” he says. “Nobody came out to talk to you from Toronto. No bank was going to come to Tumbler Ridge. So they approached Lake View. An arrangement was made with Council as to how things would unfold. We felt the community should have a financial institution.”

The big banks, says Judge, are closing branches in small towns across the country. “TD is closing 40 branches in communities bigger than Tumbler Ridge. In each of these case it’s because people are moving to online banking. Most people only go to the bank once a month. That’s a factor as well. When this discussion came up, it was not something we took lightly. If things could turn around in the community, our board would look at readjusting. But its like any business, if things go bad, you have to cut back. You look at the best case scenario in the current economy.

“We thought it was better to have a financial institution and to have it open half of the time rather than closing. We thought that was better. We want to see the community succeed. It’s tough. We could have communicated this better. But we all have to put our collective shoulders to the wheel and see and make it work for all of us.”