Message from the CEO
The end of 2019 closed out a decade that – in many ways – ended the way it started: with our world facing uncertainty. Ten years ago, the world was grappling with the challenge of a global financial crisis that sparked a decade of rapid change and complex new challenges: technological disruption and questions about the future of employment, trade conflicts that cast uncertainty on both local economies and world markets, and of course our biggest challenge, that of a growing climate crisis.
Through all of this, Vancity has proven that doing the right thing for our members and their communities – using the tools of finance to do right by our world – produces strong business results. And though 2019 was a challenging year for institutions throughout the financial sector, we’re proud of our achievements.
Total assets plus assets under administration increased 3.0 per cent or $0.8 billion over 2018, and now stand at $28.2 billion. Our membership growth rate in 2019 outpaced that of our region, increasing by 1.8 per cent or 9,685, and our assets increased 1.2 per cent or $0.3 billion over the previous year.
That growth speaks to the strength of our business model and the confidence our members have in us. But 2019 was a low-margin environment and a challenging year for financial institutions, which make money on the difference between the interest we collect on loans and the interest we pay out on deposits. As a result – and due in part to reduced earnings on our loans – our net income in 2019 was lower than the previous year at $61.0 million.
“Our long experience using the tools of banking to build the social, economic and environmental
well-beingof local communities has taught us that these same tools will be our most effective way to deal with our larger global challenges.”
While that is down from the previous year, it is a good result, and will give us money we can both invest in the future of our credit union and return to our members and their communities. As we do every year, we have allocated 30 per cent of our net income, or $18.3 million, to distribute to members and communities over the course of 2020.
Taking the lead
Vancity has never been just about money or membership counts. For us, our annual results represent real people: those throughout our communities who got access to financial services they may otherwise have been denied, families who were able to find housing they could afford, communities that became more inclusive and businesses that became more environmentally sustainable. The numbers are a means to an end, not an end in themselves.
For many years, we’ve worked to direct the whole of our business towards making a positive impact on people or the planet. These are our triple bottom line assets under administration (see page 31) and in 2019, 27.6 per cent of our assets were in this category, above our target of 27.0 per cent. Our efforts in this area are way ahead of any other financial institution in Canada. In addition, our triple bottom line assets grew at a faster rate than our assets overall, validating our values-based approach.
Our long experience using the tools of banking to build the social, economic and environmental well-being of local communities has taught us that these same tools will be our most effective way to deal with our larger global challenges. We know, for example, that if the financial system doesn’t support efforts to address the climate crisis, those efforts will fail. Money must flow to the things that make our world a better place to live for everyone. That’s why in 2019 we ensured that all the IA Clarington Inhance SRI Funds we offer are fossil fuel-free and we continued our work to more accurately measure our environmental impact (see page 22).
We certainly have more work to do in some areas. One I’d like to highlight here is our employee engagement score – a measure from an annual survey we do of employees across the organization. While our score remains higher than in previous years, our performance in 2019 came in lower than where we were in 2018 and that’s disappointing. We have taken a close look at what employees told us in this survey and have used those results to help guide our approach on everything from employee training to technology.
Our members also rightly have high expectations about how fast we can evolve, providing the digital products and services they want. We delivered 13 new products and features in 2019, more than one every month (see page 16). We also launched our One‑to-One service (see page 30), which provides much more flexible wealth management options and services for members.
The world has changed dramatically in the last ten years and Vancity has been leading the way when it comes to building a more socially and environmentally sustainable future. As we enter a new decade, the pace of change we’ve seen will only get faster. We’ll need to keep investing in people and organizations that improve our world, embed our purpose in everything we do and provide our members with the convenient, accessible services they deserve.
President and CEO
* Page references refer to the full Vancity 2019 Annual Report, downloadable at the top right of this page.