London-based Libro posts billion-dollar growth for second straight year

Article content

London’s Libro Credit Union has posted growth of more than $1 billion for the second year in a row.

The credit union revealed at its annual general meeting Saturday afternoon its total portfolio in 2021 hit $10.9 billion, an increase of $1.3 billion over 2020, according to its financial statements.

In 2020 its portfolio grew $1.1 billion over 2019.

“We are pretty happy,” Libro chief executive Steve Bolton said prior to the annual meeting.

“For the last few years more people have chosen to do business with us, they have rewarded us with their business.”

Libro also reported its assets under management grew 11.2 per cent to $6.8 billion. Assets under management include loans and investments managed by wealth advisers.

The credit union returned $13.96 million directly to owners in profit-sharing, dividends and investment shares, its annual report stated.

“We are growing at a fast pace. We are very proud of these numbers. It comes down to how we treat people,” Bolton said.

The financial services business also reported it has more than 110,000 “owners,” as it calls customers. That includes 6,470 people who joined Libro in 2021. Of those, 824 are locally owned businesses, meaning that 10,234 businesses bank with Libro.

While credit unions remain very small players in the national banking scene, they are carving a strong niche in the sector by offering service and a community focus to their business model, said Basil Kalymon, now retired Ivey business school professor, who specialized in the banking sector.

“There is no question people are attracted to a small institution closer to their communities where they reside. They have a core, a strong allegiance, which allows them to compete,” he said.

Kalymon said he was not surprised a smaller credit union would see such growth, adding Libro is likely getting a portion of personal mortgages and commercial lending business that is driving growth at banks, as well.

“There has been a huge boom in mortgage lending in the housing market and credit unions are active in that sector.”

Libro’s portfolio represents the total of all loans and deposits as well as funds under administration. Total loans grew 15.9 per cent, a significant increase from the four per cent growth in the prior year, according the credit union’s financial statements.

It was also more than doubled its profits, with Libro ending the year with net income of $25.4 million compared to prior year of $11.8 million. The increased profit was due to increased income from interest driven by more loans and gains on investments, to name a few reasons.

“Through growth, the more business we have the more revenue we earn, and we watch our investments and costs,” Bolton said.

In addition, its financial statements also revealed operating expenses increased $9.9 million to $103 million, an 11 per cent increase over 2020. Employees were the single largest expense at $66.8 million.

The annual meeting Saturday was virtual, although Libro executives and board members met in person Saturday at RBC Place, the convention centre.

As for what the future holds, Bolton pledged much of the same growth through “momentum” and it will add to its digital offerings, he said.

“The momentum will continue. We are convinced we have a strong business model for retail banking and we are investing more in digital banking,” both in cyber security and offering online and mobile options for customers.

ndebono@postmedia.com