Town of Stettler changes banks after more than 26 years

Written by ECA Review

Stettler town council decided to switch banking institutions after doing business with the same one for 26 years. The decision was made at the Feb. 1 regular council meeting.

Councillors read the results of a tender for banking services, which was presented by Chief Administrative Officer (CAO) Greg Switenky and Assistant CAO Steven Gerlitz.

The staff memo that included the tender results also included background information for the councillors. 

“The Town of Stettler has been utilizing the banking services of TD Canada Trust since September 1996,” stated the agenda memo. “The current extended banking agreement with TD Canada Trust will expire on March 1, 2022.”

Switenky stated the Town of Stettler has been with TD Canada Trust for a number of years but the agreement is subject to a tender-type process. 

The CAO added the town’s banking is “very complex” and the town shouldn’t consider switching simply because one bid is $2,000 lower than the next.

The agenda memo stated the town asks for a number of services from its banking partner. 

“The tender included an overview of the banking services offered and associated costs including savings account interest rates subtracted from prime, interest on USA bank account, investment services (short and long term), over the counter services (and much more),” stated the report.

The report included a summary of the banks that submitted tenders and included an important piece of information for councillors to consider: what the town would make on interest of a $10 million deposit minus costs. 

The tenders included Vision Credit Union (total interest minus costs of $83,750), ATB ($77,684.48), CIBC ($60,000), TD Canada Trust ($52,990.08) and Scotiabank ($40,000). 

Gerlitz noted the specific rates each bank offers to arrive at the interest minus costs is “sort of a trade secret” and were not included.

Gerlitz noted the staff recommendation was to go with Vision Credit Union.

Coun. Wayne Smith noted he’s conducted similar research for his business and warned you have to make sure you’re comparing apples to apples to make sure all the services you want are included n the offer but Gerlitz stated the town asked for the same services from all bidders.

Vision Credit Union was also described by staff and at least some councillors at the meeting, including Smith and Coun. Cheryl Barros, as a “local” bank. 

During discussion some council comments were made that the larger banks may make decisions out of Stettler or out of Alberta.

Councillors unanimously approved by resolution, “That the Town of Stettler council accept Stettler Vision Credit Union banking proposal for the period March 1, 2022 to Feb. 28, 2025 with the option of a two-year extension.”

 

Stu Salkeld, Local Journalism Initiative reporter

ECA Review

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