It’s no secret that the Canadian economy and the Canadian banking sector fared better during the 2008-09 recession than their American counterparts. Canada’s banks avoided many of the woes that plagued American financial institutions, which in part helped cushion Canadian businesses against the worst of the global recession.
However, credit unions—nonprofit, member-run financial institutions—felt more economic pressure in Canada than banks. AFP recently spoke with Rod Ancrum, chief financial officer of Credential Financial in Vancouver, British Columbia, to get his perspective on the financial crisis. Ancrum started at Credential Financial in January 2009 just as the global economy bottomed out. He helped steer his firm—which provides wealth management offerings and services to Canada’s 225 credit unions—back to health and to strong growth.AFP: What are your responsibilities as the CFO?
My role evolved over the time that I’ve been here. When I started as the CFO and my sole responsibility was finance and over the last five years my mandate has increased, so it’s now finance and I’m also responsible for human resources, technology, the project management office and I play a significant role in the development of our strategic plan.AFP: That sounds like a lot of AFP members, where they started off in a traditional finance role or treasury role and over the years they’ve accumulated HR, accounting, IT, and the like. So I’m wondering, does that make things more challenging for you? Do you relish picking up these other departments that may not necessarily fit into the traditional finance box?
It’s more challenging definitely but at the same time I relish it. It’s an opportunity for personal growth. It’s also an opportunity to challenge myself and expand my skillset and my horizons and as well my ability to help the organization move forward to achieve its vision and goals.AFP: What do you think is the biggest challenge that you faced in your five years as CFO?
The biggest challenges were in the early days. When I joined the firm we had been without a CFO for several months. We had a new executive team come in and basically the new executive team all started within two weeks of each other. And it was January 2009, so we were right in the middle of the financial crisis.
So the challenge of those first two years was working with the CEO and the other members of the executive team to bring stability to the finance team. I needed to re-staff the team, bring in the right skill sets to help us not only to survive the day but to move forward into the future. We needed to deal with the realities of the marketplace at that time, which was an extremely volatile stock market with obviously negative momentum, interest rates that were falling at a very rapid rate and resulting just in a loss of investor confidence. So every possible driver in our business at that time was negative—the business had been slow to react to what was going on in the marketplace.AFP: What keeps you up at night?
The thing that keeps me up at night is in our environment it’s tougher and tougher each year to make a dollar because of increased regulatory pressures and increasingly large infrastructures that you need. The margins that are available on products are declining. The low-interest rate environment has a significant impact on our business, again, compressing our margins.A longer version of this article appears in the June edition of AFP Exchange.