Tootoo calls for home-grown credit union

GREG YOUNGER-LEWIS

A strident critic of the Bank of Montreal’s decision to leave Nunavut suggests the territory needs a home-grown credit union to put residents’ needs first, instead of corporate profits.

Hunter Tootoo, MLA for Iqaluit Centre, recently blasted the bank in an open letter to its president and chief executive officer, accusing BMO of abandoning its policy of providing services to remote and aboriginal communities.

Bank officials have defended their decision by saying that despite earning profits in Nunavut for a decade, they can’t sustain a “viable” operation in the eastern Arctic because the profits aren’t big enough. They refuse to release information on how much money they made in the territory, but admit they earned about $600 million nationally in their last quarter.

Tootoo said in an interview this week that the bank’s attitude about profits shows Nunavut would be better off with a credit union designed specifically for the territory.

“The banks don’t really care about the people up here,” said Tootoo, a long-time client of the Bank of Montreal. “They’re just here to take the money out. A credit union would be a good way to provide the service to people here and keep the money here.”

A credit union is similar to a co-operative, in that its customers are part of its membership. Instead of aiming strictly for massive profits like the banks, credit unions usually follow a mandate of providing a service to members for the lowest price possible. Credit unions often give members voting powers to elect a board of directors.

Tootoo joined the push for a credit union in the North in the mid-1990s. He worked with staff from the Arctic Co-operatives Ltd., which runs the co-op stores around the North, and managed to raise $6 million towards launching the project.

However, Tootoo and his supporters fell $2 million short of the minimum required by law to start a credit union. When they turned to Nunavut Tunngavik Inc. to fill the gap, Tootoo said NTI officials vacillated and eventually came up with the money, too late.

This time, NTI seems poised to make a Nunavut credit union or bank a reality.

Paul Kaludjak, NTI president, confirmed that the organization will be doing a feasibility study on creating a financial institution for Nunavut.

Kaludjak said he was especially disappointed about BMO leaving Nunavut because most Inuit economic development funds held accounts with the bank.

Kaludjak takes special interest in creating a credit union or bank because he promised in his recent campaign that he would follow up on NTI’s past commitments to make direct payments to beneficiaries.

The northern co-op movement also has an interest in bringing a credit union to Nunavut.

Barry Cornthwaite, the Arctic co-op’s regional manager for Nunavut, has recently held meetings with Government of Nunavut officials about setting up a credit union in the territory.

He said a credit union will help Inuit in ways that banks can’t because large, Toronto-based corporations don’t have the personal touch that small, remote communities require.

Cornthwaite said Nunavut’s communities need a local bank branch for transactions like taking out loans for buying skidoos and trucks, or making sealift orders when they’re short of cash.

“It’s something that’s needed at the community level,” Cornthwaite said.

Results from NTI’s feasibility study are due by the end of the year.