Credit unions de­cry ‘bank­ing’ terms ban

The Hamilton Spectator - - BUSINESS - THE CANA­DIAN PRESS

TORONTO — The na­tional group rep­re­sent­ing credit unions says its mem­bers are be­ing treated un­fairly by a fed­eral reg­u­la­tor that is pro­hibit­ing them from us­ing the terms “bank,” “banker” and “bank­ing” to de­scribe their ser­vices.

The Cana­dian Credit Union As­so­ci­a­tion says the ban on the ter­mi­nol­ogy makes it dif­fi­cult for credit unions to com­pete fairly with banks.

The di­rec­tive was con­tained in an ad­vi­sory is­sued last Fri­day by the Of­fice of the Su­per­in­ten­dent of Fi­nan­cial In­sti­tu­tions (OSFI).

The as­so­ci­a­tion says it has in­ter­preted the ad­vi­sory to mean that any mem­ber who con­tin­ues to use these terms can face crim­i­nal charges.

The group also notes that due to the changes, credit unions will have to re­move any bank­ing ref­er­ences from their ad­ver­tis­ing ma­te­ri­als and their web­sites — a move it called an “un­nec­es­sary and ex­pen­sive un­der­tak­ing.”

OSFI says it is­sued the ad­vi­sory to pro­vide clar­ity af­ter ob­serv­ing in­creased use of the words “bank,” “banker” and “bank­ing” by fi­nan­cial ser­vice providers that aren’t banks.

The di­rec­tive will take ef­fect in stages, with com­pa­nies re­quired to re­move bank­ing ref­er­ences from web­sites by the end of this year and from printed ma­te­ri­als by June 30 of next year.

The credit union as­so­ci­a­tion says it had 278 credit unions and caisses pop­u­laires in its mem­ber­ship in the first quar­ter. Cana­di­ans had $176 bil­lion on de­posit with its mem­bers, it said.

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