Western Financial Group Inc. was a hub of activity this past May. First-quarter results heralded a successful year for the High River, Alta.-based institution; later the same month, its wholly owned subsidiary, Bank West, acquired Ubiquity Bank of Canada, the Internet banking arm of Prospera Credit Union of Abbotsford, B.C.

“Bank West is a relatively new bank searching for a portfolio,” says Ubiquity’s director and chief operating officer, Peter Wright. “The acquisition will give it an instant portfolio.”

Both Bank West and Ubiquity received their charters in 2002; they were, however, created for different reasons: Western Financial was looking to expand its services beyond its property and casualty insurance brokerage. Meanwhile, Prospera — like all credit unions — was facing uncertain times, and figured expanding with a virtual bank guaranteed security and furthered opportunities for growth.

“In 2002, the credit union system was wallowing around,” says Wright. “It left everyone really uncertain of where to go. Because credit unions were bound by province, [Ubiquity] was created to follow our membership into other provinces.

But new changes in operations for credit unions means they can operate nationally, he adds: “The driving force for the bank has disappeared.”

The change in credit union operations suits Western Financial just fine. On the heels of record quarterly profits for Bank West, it is eager to expand its reach. Because Ubiquity has remained very much a virtual bank, acquiring it means little more than taking on its book of business, which is expected to add $125 million to Bank West’s assets under administration. For such a considerable swell in the bank’s portfolio — almost doubling as of March 31 — there will be few to no overhead costs; the few employees of Ubiquity will be brought back under Prospera’s umbrella.

“There won’t be any lost jobs,” says Bank West’s newly appointed president and CEO, Bob Marshall. “If anything, we’re creating jobs within Bank West to deal with the increased client base.”

Besides providing growth, the acquisition will pass along a book of Western Canadian clients similar in demographic to what Bank West has already amassed. The acquisition seems a logical step to Western Financial president and CEO Scott Tannas, who has observed similar experiences in the growing businesses of the two institutions.

However, no matter the good fit and the expedited growth, there are challenges ahead for Bank West. With the departure of its retiring president and CEO, Doug Foster, shortly after the deal was announced, it was important to get the right man for the job.

“We interviewed a lot of candidates. There aren’t that many chances to lead a Canadian chartered bank,” says Tannas, “although it might be a small one. Bob Marshall understands the small-town experience and perspective.”

Beyond an understanding of the client base, Tannas feels the Lacombe, Alta.-bred Marshall is well suited to handle the development necessary to meet Western Financial’s long-term goals of continued expansion. In the short term, Marshall’s previous experience with information technology will be an asset for a primarily virtual bank. Tannas is also confident Marshall can be the face for the organization as it works at gaining brand recognition in small-town Western Canada.

For his part, Marshall intends to focus on making the Ubiquity acquisition a worthwhile endeavour, and sees his first challenge as retaining Ubiquity’s clients.

“Once you acquire, you end up with a bigger client base,” says Marshall. “You have to start to market to those people and retain the accounts you’ve purchased.”

While Bank West will be busy accommodating new clients and preparing for further growth, Prospera won’t exactly be mourning the absence of Ubiquity. On April 17, Prospera announced its intention to merge its operations with North Vancouver, B.C.-based North Shore Credit Union.

“It really is ideal,” says Wright. “We’re culturally similar; our executive teams work well together.”

Currently in the midst of a mutual evaluation process, Prospera and North Shore are working out a merger, which would see their combined operations become the third-largest credit union in B.C. under the title of Prospera Credit Union. Although the merger will expand North Shore’s reach, it will also transfer some of its 60-plus years experience to Prospera, a relative newcomer.

“There’s no overlap of branches,” says Wright. “So, we can provide job security for our employees and have a corporate footprint from Whistler to the Okanagan.” IE

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