Westforce Credit Union
In accordance with the Friendly Societies and Credit Unions Act 1982, by way of public notices in regional newspapers and on our website, we advised Members that Westforce Credit Union had asked to transfer their credit union to us. This is formally called a Transfer of Engagements. Under the rules of FCU, your board has to approve or otherwise any request for a TOE. FCU have over the years followed this process for a variety of credit unions that have asked to transfer to us – such as United Credit Union, NZCU Rotorua, NZCU North, Credit Union Health, CU Bay of Plenty and Te Aroha Community Credit Union, amongst others. Not all of these credit unions were in good shape when they transferred to us, but through the hard work and diligence of board and staff, the transfers have all been successful.
Westforce Credit Union members formally voted on Thursday 16th June to transfer their credit union to First Credit Union.
Today your board resolved as follows:
In accordance with rule 76 of its Rules and section 135 of the Friendly Societies and Credit Unions Act 1982, the Board resolves, on behalf of the members of First, to accept a transfer of Westforce Credit Union's engagements and undertakes to fulfil those engagements (the same having been approved by special resolution of the members of Westforce Credit Union at a meeting held on 16 June 2022). The Board further resolves to do all things necessary or desirable to give effect to this resolution.
The transfer will occur on 1 August 2022 subject to regulatory approvals.
Westforce have over recent years struggled to make profits and that is why their board made the decision to recommend the transfer to FCU. FCU’s board and management have undertaken a rigorous risk assessment and due diligence process, looking at both financial and non-financial matters, including potential risks from not accepting the TOE request. As a result FCU’s board believe that Westforce will be a good, and positive fit for many reasons, including but not limited to:
- It enables FCU to expand into Auckland with readymade branches rather than greenfield sites. As an example - FCU had looked at the growing region of Pukekohe as a possible expansion area but Westforce were already there. Now we can build on that presence.
- Westforce have great staff – and we at FCU are (like just about every employer in New Zealand) struggling to get great new staff.
- Westforce were constrained by liquidity for lending, but with FCU this will not be an issue. We are confident we can increase the loan book, providing additional loan opportunities for the members, and increased income for the credit union.
- Westforce will no longer have the same cost structure – compliance costs, auditing costs, trustee costs, board costs, duplicated back office and some IT costs will no longer exist and will be part and parcel of the business as usual costs of FCU.
- Westforce operate on the same banking platform as FCU, and have the same debit card suppliers – and we are mindful that with extra scale will come future cost savings.
- The transfer will strengthen our core Credit Union philosophy of serving the underserved with access to credit and banking products.
- Our wholly owned subsidiary, First Insurance Limited, will be able to provide Loan Protection and Funeral products to Westforce as a further member benefit.
I can say that the staff and board of FCU are excited to be able to increase the reach of FCU to our members and potential new members. We look forward to welcoming the Westforce team on 1 August, along with their 4,000 members.