• This decision is based on our experience with existing and prospective members, where the majority clearly prefer a best up-front rate instead of a rate and patronage; as LCU pricing is consistently better than our competitors, a rate-only approach positions LCU in the best light.
• To make it easier for staff to communicate the LCU price advantage and for our members and prospective members to comprehend it, noting banks do not have patronage; a rate comparison adjusted for patronage will no longer be required.
• Provide greater certainty for members of the LCU better rate advantage, noting patronage was historically estimated at the time of say a mortgage decision and the actual patronage paid varied year-to-year.
• More transparent and easier to interpret pricing = higher membership growth = increased profitability = increased investments intended to raise our service levels to heights unprecedented in banking anywhere in Alberta!

Lakeland Credit Union is one of, if not the best capitalized credit union in Canada based on standard capital ratio measurements.

• Lakeland Credit Union’s financial strength can support a doubling of our book of business overnight, and this is why we are moving to a pricing structure that better supports growth by providing increased and more certain member value right up front.

Fiscal 2025 income is down for the primary reason that we substantially reduced mortgage rates in recent years to provide members with the best rate on the street (expanded on in the response to question #4).

• Credit union policy limits the annual payout of patronage and dividends to 60% of annual income such that historical payout of patronage and dividends would not be possible this year without an exception to policy.
• An exception to policy was considered and possible based on Lakeland Credit Union’s capital strength however, the reasons presented above in support of even better pricing was in the membership’s best interest.

Noteworthy, income for 2026 is forecast to be substantially higher than 2025 and provide the opportunity for even more competitive overall pricing.

For members experiencing a financial strain, a one-month mortgage payment deferral is offered free of charge, available between now and January 31, 2026 (subject to standard credit approval criteria).

• The credit union co-operative model can be best defined by the primary distinction that unlike a bank, a credit union is not required to generate the same level of profits needed for distribution to bank shareholders, and a credit union can therefore offer its members better banking value.
• The above distinction, coupled with Lakeland Credit Union’s strong capital position (strongest capital ratios of any credit union in the province), is why we can offer the best in-market pricing to our members.
• Lakeland Credit Union’s co-operative principles are evident in numerous other practices and initiatives, a few of which are referenced below.
  • Dividend payouts on common shares which will continue this month (December) and be 4.25%, higher than the most recent dividend payouts at Canadian chartered banks and comparing favourably to a one-year term deposit rate of one year ago; two common benchmarks used to evaluate a credit union dividend.
  •  LCU gives back to the local communities more than all the banks combined! Our community donation budget for 2026 is $100,000.
  • Lakeland Credit Union people volunteering at events throughout the year is a most common sight throughout the Lakeland!
• We are not alone in moving away from patronage with many credit unions across Canada having chosen to do as we are today and for similar reasons.