Government of Canada Partners With Affinity Credit Union to Improve Financing for First Nation Businesses in Saskatchewan
Ottawa, Ontario –(April 24, 2009) – The Honourable Chuck Strahl, Minister of Indian Affairs and Northern Development and Federal Interlocutor for Metis and Non-Status Indians, today announced an innovative partnership with Affinity Credit Union in Saskatchewan to provide debt financing to First Nation businesses with assets on a reserve.”The Government of Canada is working with financial institutions across the country to address some of the long-standing barriers to the growth and competitiveness of First Nation businesses,” said Minister Strahl. “I would like to commend Affinity Credit Union for its participation in this unique initiative and for its shared commitment to Aboriginal economic development.”
Under the arrangement, Indian and Northern Affairs Canada (INAC) will provide $1.9 million to establish a loan loss reserve fund with Affinity Credit Union. The reserve fund will be used by financial institutions as collateral to finance loans to medium and large First Nation businesses in Saskatchewan with the assets needed to secure the loan located on a reserve.
“First Nation people are an integral part of the social and economic fabric of Saskatchewan,” said Linda Moulin, Senior Vice President Corporate Development at Affinity Credit Union. “The loan loss reserve fund provides a unique opportunity for Affinity Credit Union to work collaboratively and co-operatively to enhance economic development among First Nation communities.”
INAC’s pilot Loan Loss Reserve Initiative will make First Nation businesses more competitive by addressing certain historical impediments to debt financing, including provisions in the Indian Act that prohibit the use of reserve land as collateral. The reserve fund works by offsetting a portion of the lender’s potential losses on loans to First Nation businesses.
Affinity Credit Union is the second largest credit union in Saskatchewan and is comprised of nine Districts, including a First Nations District. It provides access to a complete range of financial products and services including every-day banking, insurance, mortgages, and wealth management products to 95,000 member-owners though a network of 46 branches in 37 communities across Saskatchewan. Affinity commits at least 3 per cent of its annual pre-tax profits to community support each year.
Through the Loan Loss Reserve Initiative and other Aboriginal economic development measures, the Government of Canada is demonstrating its continued commitment to increasing Aboriginal participation in the Canadian economy.
This release is also available on the Internet at www.inac.gc.ca
For more information, please contact
Office of the Honourable Chuck Strahl
Nina Chiarelli, Press Secretary
Indian and Northern Affairs Canada
Affinity Credit Union
Aboriginal Business Development Manager
306-934-4041 OR 306-291-3060