Vancity says it is laying off seven per cent of its staff after a year of losses and rising costs.
The decision affects nearly 200 workers at Canada’s largest community credit union, according to a Thursday news release from the credit union’s CEO, Wellington Holbrook.
Holbrook said Vancity needs to restructure to meet current market conditions and invest in its growth.
According to its 2023 annual report, Vancity ended the year with a net loss of $1.3 million after tax. Without profit, Holbrook said the credit union wasn’t able to share dividends with members, despite previous “record” allocations.
The CEO attributed the challenge to rising costs and the “unprecedented” rise in interest rates over the past few years. In particular, he said Vancity holds many loans that were issued at record low interest rates while the higher interest rates have lowered demand for new loans.
“Our results are also not surprising given the economy around us,” he said in the annual report.
Holbrook noted in the report that the credit union set aside “ample reserves” to cover contingencies, even if it restricted last year’s profitability.
Vancity said in the Thursday news release that it is offering laid-off employees “a comprehensive, fair and equitable package of compensation, health and well-being, and career supports.”
Vancity declined to comment further. CBC News has also requested comment from the B.C. General Employees’ Union, which represents some of the credit union’s workers.