Is There a Credit Union Difference? Comparing Canadian Credit Union and Bank Branch Locations
DOI:
https://doi.org/10.22230/cjnser.2016v7n2a236Keywords:
Credit Unions, Canada, niche, location, branchAbstract
This study of credit union and bank branch locations and neighbourhoods in Canada seeks to discover if there is a distinct credit union niche. The study builds on an earlier paper of credit unions and banks in the US which found that credit unions in Wisconsin, Arizona and New Hampshire were more likely to be located in lower-income areas than bank branches (Mook, Maiorano & Quarter, 2015). In Canada, we find that credit union branches are over-represented in rural areas, and under-represented in large population centres relative to bank branches. Additionally, credit unions are overrepresented in middle income areas and underrepresented in high income areas compared to bank branches both at the national level and in all provinces where differences are statistically significant. Another significant finding is that while both credit unions and banks cater to marginalized communities, the type of marginalized communities they cater to distinguishes them. Making use of the Canadian Marginalization Index, we find credit union branches in Canada to be overrepresented in communities marginalized along the dimensions of Material Deprivation and Dependency, while bank branches are overrepresented in communities marginalized along the dimension of Residential Instability and Ethnic Concentration.
Downloads
References
Bank of Canada. (2014). Financial System Review. June 2014. Retrieved from: http://www.bankofcanada.ca/2014/06/fsr-june-201
Bank of Montreal. (2016a). Everyday banking essentials. Retrieved from http://www.bmo.com/newstart/pdfs/Everyday_Banking_Essentials_ENG.p
Bank of Montreal. (2016b). Immigrant Banking Services. https://www.bmo.com/asia/immigration_banking_services.ht
Brennan, M., McGregor, B., & Buckland, J. (2011). The changing structure of inner-city retail banking: examining bank branch and payday loan outlet locations in Winnipeg, 1980-2009. Canadian Journal of Urban Research, 20(1), 1-3
Brown, S. (2015 Mar). Serving the cultural mosaic: Attracting an immigrant membership is a win-win deal, Enterprise, Retrieved from http://enterprise-magazine.com/features/serving-the-cultural-mosai
Bank of Nova Scotia (BNS). (2016). Creating the life you want in Canada. Retrieved from http://www.scotiabank.com/ca/en/0,,4355,00.ht
Canadian Credit Union Association (CCUA). (2016 July 4). CCUA congratulates UNI Financial Cooperation on becoming first Canadian credit union to obtain a federal charter, Retrieved from https://www.ccua.com/media/2016_07_04_UNI_financial_cooperation_obtain_a_federal_chart
Canadian Imperial Bank of Commerce (CIBC). (2016a). CIBC Quick facts. Retrieved from https://www.cibc.com/ca/inside-cibc/quick-facts.ht
Canadian Imperial Bank of Commerce (CIBC). (2016b). New to Canada? Meet the bank that wants to meet you. Retrieved from https://www.cibc.com/ca/advice-centre/newcomers-to-canada.ht
Canadian Credit Union Association. (2015a). System results: First quarter 2015. Retrieved from https://www.ccua.com/~/media/Public/About/facts_and_figures/documents/Quarterly%20National%20System%20Results/2015_05_27_1Q15_system_results.p
Canadian Credit Union Association. (2015b). System results: Largest 100 credit unions/caisses populaires. Retrieved from: https://www.ccua.com/~/media/Public/About/facts_and_figures/documents/Largest%20100%20Credit%20Unions/2015_09_22_top100_2Q15.p
Cheung, B., Christian, J., La Rose, M. (2013). Financial Services Needs of Immigrant Communities in Canada and the United States. Filene Research Institute
Deller, S., & Sundaram-Stuckel, R. (2012). Spatial patterns in the location decisions of US credit unions. The Annals of Regional Science, 49(2), 417-445. doi:10.1007/s00168-011-0457
Desjardins. (2015). Financial statement, first quarter 2015. Retrieved from http://www.desjardins.com/ressources/pdf/2015051301-e.pdf?resVer=14315317280
Desjardins. (2016a). Organizational chart. Retrieved from http://www.desjardins.com/ca/about-us/desjardins/governance-democracy/structure/group-organization-chart/index.j
Desjardins (2016b). Quick facts about Desjardins. Retrieved from http://www.desjardins.com/ca/about-us/desjardins/who-we-are/quick-facts/index.jsp?navigMW=m
Eaton, C., & Lipsey R.G. (1982) An economic theory of central places. Econ J 92(March):56–72
European Association of Co-operative Banks. (2013). Latest key figures. Retrieved from http://www.eacb.coop/en/cooperative_banks/key_figures/last_key_figures.ht
Feinberg, RM. (2008) Explaining the credit union entry decision, and implications for performance. Review Ind Organ 33:81–91
Flaherty, J. (2010). Budget 2010: Leading the Way on Jobs and Growth. Retrieved from: http://www.budget.gc.ca/2010/pdf/budget-planbudgetaire-eng.p
Flaherty, J. (2013, March 21). Jobs, Growth and Long-Term Prosperity: Economic Action Plan 2013. Retrieved from http://www.budget.gc.ca/2013/doc/plan/chap3-2-eng.html#a92-Phasing-Out-the-Additional-Deduction-for-Credit-Unio
Graves, S. (2003). Landscapes of predation, landscapes of neglect: A location analysis of payday lenders and banks. The Professional Geographer, 55(3) 2003, pages 303–317
International Monetary Fund (IMF). (2014). Financial Sector Assessment Program: Intensity and Effectiveness of Federal Bank Supervision in Canada - Technical Note. Washington, D.
Ketilson, L., and Brown, K. (2011). Models for Effective Credit Union Governance: Maintaining Community Connections following a Merger. Retrieved 20 May 2016 from http://usaskstudies.coop/documents/occasional-papers/Models%20for%20Effective%20CU%20Governance%20pdf.pd
King, L.J. (1984). Central place theory. SAGE Publications, London
Macpherson, I. (1979). Each for all: A history of the co-operative movement in English Canada: 1900-1945. Toronto, Ontario, Canada: Macmilla
Macpherson, I. (1999). Hands around the globe: A history of the international credit union movement and the role and development of World Council of Credit Unions. Victoria, British Columbia, Canada: Horsdal and Schubar
Macpherson, I. (2012). Historic changes in the Canadian credit union movement. In L. Mook, J. Quarter, & S. Ryan (Eds.), Businesses with a difference: Balancing the social and economic (pp. 19-39). Toronto, Ontario, Canada: University of Toronto Press
Matheson, F., Dunn, J., Smith, K., Moineddin, R., Glazier, R. (2012a). Canadian Marginalization Index (CAN-Marg) [Data file]. http://www.crunch.mcmaster.ca/canadian-marginalization-ind
Matheson, F., Dunn, J., Smith, K., Moineddin, R., Glazier, R. (2012b). Canadian Marginalization Index: User Guide Version 1.0. Centre for Research on Inner City Health. Retrieved from: http://www.crunch.mcmaster.ca/canadian-marginalization-ind
McNish, J. (2011). Desjardins quiet revolution. Globe and Mail, Feb. 24. Retrieved from http://www.theglobeandmail.com/report-on-business/rob-magazine/desjardins-quiet-revolution/article597309/?page=a
Mook, L., Hann, J., & Quarter, J. (2012). Understanding the rural tilt among financial co-operatives in Canada. Canadian Journal of Nonprofit and Social Economy Research, 3(1), 42-58. http://anserj.ca/index.php/cjnser/article/download/107/6
Mook, L., Maiorano, J., & Quarter, J. (2015). Credit Unions: Market Niche or Market Accommodation? Nonprofit and Voluntary Sector Quarterly, 44(4), 814-831. doi:10.1177/08997640145381
Morneau, W.F. (2016, March 22). Growing the Middle Class. Retrieved from http://www.budget.gc.ca/2016/docs/plan/ch8-en.htm
Pierce, N. (2011). Credit unions. In J. R. Whitman (Ed.), The curriculum on cooperatives. Retrieved from http://cooperative-curriculum.wikispaces.co
Prospectus (Federal Credit Unions) Regulations. (2012), Retrieved from Minister of Justice website: http://laws-lois.justice.gc.ca/eng/regulations/SOR-2012-265/FullText.ht
Quarter, J., Mook, L., & Armstrong, A. (in press). Understanding the social economy: A Canadian perspective. (2nd Ed.). Toronto: University of Toronto Press
Reschovsky, A. (2010, September 5). Banks Take Aim at Credit Unions Tax Exempt Status. The CAP Times. Retrieved from: http://host.madison.com/ct/business/banks-take-aim-at-credit-unions-tax-exempt-status/article_37e495d6-b84c-11df-a86c-001cc4c002e0.ht
Royal Bank of Canada (RBC). (2016). Newcomers to Canada. Retrieved from: http://www.rbc.com/newcomer
Shecter, B. (2014, August 23). Credit unions staying under the radar in Canada’s patchwork regulatory system. Financial Post. Retrieved from: http://business.financialpost.com/news/fp-street/credit-unions-staying-under-the-radar-in-canadas-patchwork-regulatory-syst
Statistics Canada. (2011). Census Dictionary: Census year 2011. Ottawa: Minister of Industry, 2012. Catalogue no. 98-301
Statistics Canada. (2012). Population growth in Canada: From 1851 to 2061: Population and dwelling counts, 2011 Census. Ottawa: Minister of Industry, 2012. Catalogue no. 98-310-X20110
Statistics Canada. (2013a). Postal Code Conversion File (PCCF), Reference Guide: June 2013 postal codes. Ottawa: Industry Canada, 2013. Catalogue no. 92-154
Statistics Canada. (2013b). Postal Code Conversion File Version 6A1 [Data file]. Retrieved from: http://data.library.utoronto.ca/content/postal-code-conversion-fi
Statistics Canada. (2014). 2011 National Household Survey: Data Tables Selected Demographic, Sociocultural, Education and Labour Characteristics (322), Sex (3) and Income Status in 2010 (6) for the Population in Private Households of Canada, Provinces, Census Metropolitan Areas and Census Agglomerations, 2011 National Household Survey. [Catalogue no. 99-001-X2011001]. Retrieved May 25, 2014 from Statistics Canada: http://www12.statcan.gc.ca/nhs-enm/2011/dp-pd/dt-td/Rp-eng.cfm?LANG=E&APATH=3&DETAIL=0&DIM=0&FL=A&FREE=0&GC=0&GID=0&GK=0&GRP=1&PID=106715&PRID=0&PTYPE=105277&S=0&SHOWALL=0&SUB=0&Temporal=2013&THEME=98&VID=0&VNAMEE=&VNAME
Toronto-Dominion Bank (TD). (2016). Get your New to Canada Banking Package. Retrieved from: https://www.tdcanadatrust.com/planning/life-events/new-to-canada/index.j
Trichur, R. (2007, Dec 28). Banking on immigrants, Toronto Star. Retrieved from http://www.thestar.com/business/2007/12/28/banking_on_immigrants.ht
Ward, A. M., & McKillop, D. G. (2005). An investigation into the link between UK credit union characteristics, location and their success. Annals of Public and Cooperative Economics. 76(3), 461-489
Downloads
Published
Issue
Section
License
Submission of an original manuscript to the Canadian Journal of Nonprofit and Social Economy Research / Revue canadienne de recherche sur les OSBL et l'économie sociale [thereafter CJNSER] will be taken to mean that it represents original work not previously published, and that it is not being considered elsewhere for publication.
The journal takes the stance that the publication of scholarly research is meant to disseminate knowledge and, in a not-for-profit regime, benefits neither publisher nor author financially. It sees itself as having an obligation to its authors and to society to make content available online now that the technology allows for such a possibility. In keeping with this principle, the journal will publish all of its issues online.
Authors who publish in CJNSER agree to release their articles under the Creative Commons 4.0 International Licence (CC BY). This licence allows anyone to copy and distribute the article provided that appropriate attribution is given. For details of the rights an author grants users of their work, please see the licence summary and the full licence.
[Content published between 2010 and 2019-10 was licensed under the Creative Commons Attribution-NonCommercial-NoDerivs 2.5 Canada (CC BY-NC-ND 2.5 CA) License. Content published between 2019-10 to 2023-12 was licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0) License. Content published after 2023-12 is licensed under the Creative Commons 4.0 International (CC BY) License.]
