Despite stagnant economic growth in Canada and ominous signs in Europe and the U.S., Island Savings Credit Union has decided to spread its wings.
The credit union, which boasts 58,000 members and about $1.7 billion in assets under administration, has undertaken a three-year, $15 million rebranding and expansion program that will see two new Victoria locations open in the next six months and a new approach to customer care within its branches.
"This period of uncertainty has been going on for a while, and people are saying it's the new normal and are planning accordingly," said CEO Rod Dewar, noting that can mean shopping for better interest rates, reining in spending or getting their affairs in order.
But Dewar was quick to note there are plenty of people taking advantage of the situation to invest, and Island Savings can be counted in that number.
"We have seen growth in our business the last three years despite this environment," Dewar said. "And we are actually investing in the future. My hope is when [the business cycle improves] we will hit the ground running."
Dewar said the company is taking advantage of low construction, labour and materials costs and good deals in real estate to expand its footprint.
The company has plans to convert what was a Blockbuster Video near the corner of Fort Street and Foul Bay Road into a 4,600 square foot branch by next spring. And they hope to open a location at Tuscany Village - also in a former Blockbuster store - before the end of the year.
That will give the chain six locations in Victoria.
Dewar estimates the credit union could have $2.8 billion under administration by 2015 on the Island and $1.24 billion of that in Victoria. There could be further expansion in both Victoria and Nanaimo as economic conditions improve.
"We have decided to move forward and be part of our own destiny rather than waiting for things to fix themselves," Dewar said.
That could take a while, according to Central Credit Union 1 chief economist Helmut Pastrick, who was in Victoria this week to meet with Island Savings members.
Pastrick said the Canadian and B.C. economies will continue on the modest-to moderate-growth path for the next year before strong growth returns after 2014.
"I expect that kind of growth in 2015, 2016 and 2017. We'd get a lift from the U.S. economy. That rising tide should help everyone," Pastrick said, noting there are already glimmers of hope with improved auto sales, house prices and home building numbers coming out of the U.S. "Coming out of [recession] in the U.S. has been a laborious process.
"But when the U.S. picks up, the global economy will be that much healthier and we'll see trade flows improve."
Pastrick said B.C.'s economic growth, held back by a general economic slowdown in North America because of influences in Europe and Asia, should expect growth of between 2.0 to 2.5 per cent next year, with improvement beyond that in 2014.
As for the Island, he expects it to lag behind the provincial number.
"The Island never really had any significant recovery from the recession," Pastrick said. There was some noticeable improvement in housing but that has flatlined."
Pastrick said while Europe is making some moves to stabilize the economy, it still poses trouble for financial markets worldwide, which will hold back growth in North America and continue to impede both investor and consumer confidence.
But over the long-term, Pastrick was bullish on Canada and B.C.
