First Nations Bank of Canada expands its service to more communities

Canadian banks are famous for their enormous profits, even during tough economic times. From boardrooms in Toronto and New York City, executives set out policy that guides investment and personal finance.

Eeyou Istchee can feel like a world away.

Yet the services banks offer – the ability to safeguard savings, get a mortgage and cash cheques – are vital for day-to-day economic life.

That’s one reason why the First Nations Bank of Canada is selling itself as a natural fit for Canada’s First Peoples.

“It’s a bank created for Aboriginal people by Aboriginal people,” said CEO Keith Martell.

“The First Nations bank is 80% Aboriginal owned and operated and is primarily focused on serving Canada’s Aboriginal market place. It currently boasts 12,000 customers, including 1,500 commercial clients, like Aboriginal entities and businesses.”

Martell says that many banks see tremendous potential in Canada’s First Nations and are vying for a market share. But they lack a true understanding of the specific needs of communities, many of which are rural and still operate in traditional languages.

“Lots of banks tried to focus on the Aboriginal market. But they fail to understand the socioeconomic situation of the communities or even the basic regulations surrounding taxation. And if you don’t understand that, it’s hard to meet the needs of the customers.”

Martell says while Aboriginal communities represent a “sideline” opportunity to bigger banks, they have always been the focus of the First Nations Bank.

In addition to eight full-service branches, it operates four community-banking centres in remote First Nations communities.

Two recently opened up in Pond Inlet and Baker Lake, Nunavut, communities that have never hosted financial institutions. Martell says they play an important role in the communities, allowing people to have access to basic banking services.

These banks, he says, help foster business and save people from using expensive, non-bank, private cheque-cashing services, which charge large sums of money.

“Community banking centres are an example of our commitment to the Aboriginal market. We recognize that they are important to these communities,” said Martell.

The Saskatchewan Indian Equity Foundation and TD Bank launched the bank in 1996. TD continues to hold a 20% stake, but Martell says it has been completely independent since 2009: TD has no special rights with regards to the bank’s operations.

“They are actually our competitors in some markets,” Martell joked.

The Cree connection to the bank also runs deep. Grand Chief Mathew Coon Come was a founding member of the bank. And since 2001, the Board of Compensation and the James Bay Eeyou Corporation have owned 16.5% of the bank.

It operates a full-service branch in Chisasibi and a community-banking centre in Nemaska.

Grand Council Executive Director Bill Namagoose currently sits on the board of the bank. He says having an independent Aboriginal-run bank is important for the Cree and other First Nations.

“Developing a financial institution is a form of nation building,” said Namagoose. “Most nations have their own financial institutions. Having access to capital gives you lots of social and economic options.”

He says that other banks can sometimes take First Nations business for granted and points to Chisasibi to illustrate his point.

People were calling on the CIBC to open up an ATM for years, he says. “And it was not until the First Nations bank opened that they finally put one in.”

Martell says that he is excited about the massive economic potential of Canada’s Aboriginal people. He sees a young population with increasing access to education, and governments that are increasingly looking to include First Nations in economic-development opportunities.

“Take mining – in the past it would happen despite us. Now it’s happening with us,” said Martell.

He says the bank is in the “advance stages” of developing a new, more competitive credit card. And he says he sees more opportunity for expansion in the James Bay area.

His pitch for new customers is simple and strong: “We offer competitive services that are focused on you.”