Target dividend rate up to
6.25%*
Key Features at a Glance:
Potential to Earn a Premium Rate of Return
Diversified Investment Solution
Contribute to Local Growth
Welcome to an exclusive opportunity for Northern Credit Union members – the chance to be a part of our growth and success while diversifying your investment solutions. Introducing Class B Investment Shares, a unique equity investment that opens doors to a diversified portfolio and the potential for attractive returns.
Or call the True North Hub at 1-866-413-7071.
Class B Investment Shares are perfect for those who:
Are looking for
Portfolio Diversity.
Explore new dimensions in your investment strategy.
Have
Long-Term Vision.
Align your investments with a horizon that spans years, not just moments.
Value
Local Impact.
Contribute to the growth and success of your local credit union.
Everyone wins when you purchase investment shares – you and your credit union.
What are
Class B Investment Shares?
Class B Investment Shares offer a distinctive equity investment opportunity, available exclusively to Northern Credit Union members. Unlike traditional deposits, these shares offer the potential for an appealing rate of return within a diversified portfolio. Please note that returns are not guaranteed, and these funds do not qualify for deposit insurance through the Financial Services Regulatory Authority.
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Why Invest in
Class B Investment Shares?
Class B Investment Shares offer members the potential to earn a targeted rate of return of 6.25%*. By investing in Class B Investment Shares, you contribute to the sustainable, long-term growth of Northern Credit Union. The funds raised through this offering will empower us to develop new products, services, and digital transformation initiatives, catering to the evolving needs of our members.
* Dividend rates and payments are not guaranteed. Dividends may not be paid or may not be paid at the target rate.
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Invest with Confidence
Diversify your portfolio and invest with purpose. Choose Class B Investment Shares for a blend of growth, and community impact.
Visit your local branch to learn more.
Class B Investment Share Offering Historical Dividend Payment.*
Class B Investment Share dividend payments are based on credit union performance and the current environment. If dividends will be paid and the dividend rate is at the discretion of the Board of Directors, annually. The current year rate will be determined by the Board of Directors. Past performance is not indicative of future results.
A Northern Class B Share Representative will help you understand if Class B Investment Shares are right for you.
Class B
|
|
| 2012 | 3.22% |
| 2013 | 3.39% |
| 2014 | 3.75% |
| 2015 | 3.11% |
| 2016 | 2.85% |
| 2017 | 2.93% |
| 2018 | 3.53% |
| 2019 | 3.77% |
| 2020 | 2.96% |
| 2021 | 2.58% |
| 2022 | 4.62% |
| 2023 | 5.47% |
Frequently Asked Questions
What are Class B Investment Shares?
Class B Investment Shares represent a unique equity investment opportunity available exclusively to Northern Credit Union members. This presents an opportunity to earn a rate of return above the 5-year posted GIC rate and hold a diversified investment. It is important to recognize that Investment Shares differ from deposits; returns are not guaranteed, and these funds do not qualify for deposit insurance through the Financial Services Regulatory Authority (FSRA).
As an equity investment, there is an element of risk, which is detailed in the Investment Offering Statement starting on page 19.
Why is Northern Credit Union selling Class B Investment Shares?
The primary purpose of the proceeds from the sale of Class B Investment Shares is to strengthen our capital base. These funds will play a crucial role in supporting the sustainable, long-term growth of Northern Credit Union. Class B Investment Shares will empower Northern to invest in the development of new products, services, and ongoing digital transformation initiatives, catering to the expanding needs of both our current and future members.
Committed to adhering to standardized international liquidity metrics, Northern follows the stringent regulatory framework set by Canada's financial industry. This robust regulatory system is designed to provide essential checks and balances, ensuring the protection of our members and consumers. Rest assured, Northern Credit Union remains strong, diligently monitoring and upholding all liquidity requirements.
What kind of return can I earn on Northern Class B Investment Shares?
Annually, Northern's Board of Directors determines if a dividend will be paid on all Class B Investment Shares Series. If paid, dividends may be disbursed in the form of cash, shares, or a combination of both. Historically, Northern has followed the practice of issuing dividends on its investment shares in the form of additional shares.
The target dividend rate is calculated as the greater of:
- 6.25%; and
- 1.0% above the simple average of the posted rates offered by the Credit Union on its 5-year non-redeemable term deposits at the end of each month during the fiscal year. During the first 5 years after issuance, the Class B Investment Shares will pay a target rate of 6.25%.
The Board will establish a consistent dividend policy for all series of Class B Investment Shares, aligning with the principles outlined above for Series 2024. Dividend rates and payments are not guaranteed. Dividends may not be paid or may not be paid at the target rate.
Is the dividend guaranteed?
No, the approval of Northern Credit Union's annual dividend payment, as declared solely by the Board of Directors, is contingent upon the credit union's performance throughout the fiscal year. This decision considers factors such as profitability, liquidity, and adherence to operational and regulatory requirements. It's important to note that dividend payments are not guaranteed.
While Northern Credit Union has consistently declared and paid annual dividends across all existing investment share series; past payment of dividends does not guarantee the likelihood of payments or a specific rate of return.
Who may purchase Class B Investment Shares?
The sale of Class B Investment Shares is restricted to members of Northern who are at least 18 years of age.
Are investment shares eligible for Registered Savings Accounts?
Absolutely, Class B Investment Shares can be held in portfolios designated as either non-registered or registered (specifically, RRSP, RRIF, or TFSA). Class B Investment Shares are designed as long-term investment solutions, which make them well-suited for RRSP Investments. Members who have RRSP investments held at other Financial Institutions can be seamlessly transferred to Northern’s Class B Investment Shares without incurring any tax penalties. Funds must be received by the Credit Union in advance of the closing of the Class B Investment Share Offering to be considered as sold.Why would I want to purchase Class B Investment Shares, Series 2024 instead of other investment solutions?
Investment shares present an opportunity to diversify your investment solutions while simultaneously contributing to the growth of your credit union and community. However, it is important to thoroughly review and understand the associated benefits and risks.
Feel free to reach out to your local branch or contact our True North Hub to evaluate whether this investment aligns with your financial goals and preferences.
I currently have money locked into a deposit (GIC, RRSP, TFSA) with Northern. Can I transfer funds from this investment to purchase Investment Shares?
Yes. Members who wish to invest in Northern Class B Investment Shares will be permitted to transfer funds invested in an existing Northern investment (providing it is not currently pledged as security), with no early withdrawal penalty or loss of interest.
Note: Market Linked GICs are ineligible as they are held by a third party.
Note: RRIFs are not recommended for Class B Investment Shares because, as an income fund, withdrawals must be made in accordance with CRA rules. To review this solution and others please contact a Class B Investment branch expert or contact the True North Hub.
How will the Canada Revenue Agency treat dividend income?
According to the Canada Revenue Agency, the dividends paid on the Investment Shares will be treated as interest income from a Canadian source (not a capital gain), which must be reported on your income tax return. We will issue and mail to you the appropriate T5 form for this purpose.
Are the Class B Investment Shares insured through the Deposit Insurance Reserve Fund (DIRF)?
No. Class B Investment Shares are not insured through the Deposit Insurance Reserve Fund. The credit union deposit insurance is designed to cover member deposits and a deposit is repaid upon demand. Class B Investment Shares, Series 2024 are an equity investment in the Credit Union and are not redeemable on demand, but rather at the discretion of the Board of Directors. They are backed by the financial stability of the credit union. For more information on the Deposit Insurance Reserve Fund please click here: https://www.fsrao.ca/media/1906/download
What is the price of an Investment Share? Are there minimum and maximum investment limits?
Each Investment Share is priced at $1.00. The minimum investment is $1,000 and the maximum is 500,000.
The purpose of the limits is to make the Investment Shares easily accessible to the Northern Credit Union’s members and widely available, without unduly restricting those who wish to make larger investments.
Are there fees associated with either purchasing or redeeming these Investment Shares?
No.
When can I buy Investment Shares? How many are being offered?
The sales period commences on April 1, 2024, and will continue until either the subscription reaches the maximum issuance of $30 million, the Board officially declares the offering closed upon achieving the minimum offering of $10 million, or until October 2024, whichever occurs first.
How do I transfer (sell) my Class B Investment Shares?
Members have the option to transfer (sell) their investment shares to other interested members. As sales requests are fulfilled based on the availability of members looking to purchase, Northern Credit Union cannot assure the sale of shares within a specific timeframe. Transfer requests must be in writing, using a form approved by the board. Transfer requests will be tendered to the registered office of the Credit Union. Class B Shares, Series 2024 will be transferred to other members at a price equal to the current Redemption Amount. There is no market for the Class B Shares, Series 2024 issued by the Credit Union. The Credit Union maintains a list of willing buyers and attempts to facilitate a transfer to a willing buyer rather than process a redemption when a holder of Class B Shares, Series 2024 requests redemption. To access funds held in Class B Investment Shares, members must submit a redemption request (partial or full) through their branch for the Board’s consideration.
For more information on transferring investment shares, please refer to the Share Offering Statement.
How do I redeem my Investment Shares after the five-year redemption period?
Redemptions are limited to a maximum of 10% annually, non-redeemable for the first 5 years (with exception) and redemption approvals within this limit are at the discretion of the Board. The Class B Investment Share Offering Statement provides comprehensive details on how members can initiate the redemption of their investment shares. Redemption requests are considered by the Board of Directors at its meetings held in January, March, June, and September annually. If approved, these requests will be processed.
Each year a maximum of 10% of the shares outstanding at the end of the previous fiscal year will be eligible for redemption. Members interested in redeeming their Class B Investment Shares are required to make a formal written request to the Credit Union. There is no market for the Class B Shares, Series 2024 issued by the Credit Union. The Credit Union maintains a list of willing buyers and attempts to facilitate a transfer to a willing buyer rather than process a redemption when a holder of Class B Shares, Series 2024 requests redemption. (Please refer to pages 19 and 20 of the Share Offering Statement.) Redemption requests will be considered on a first-come, first-served basis.
To obtain more information about redeeming investment shares, please get in touch with your local branch or contact our True North Hub.
How do I know if Class B Investment Shares are right for me and my investment goals?
Class B Investment Shares are well-suited for individuals who have a long-term investment horizon, exploring opportunities to diversify their current investment portfolio, are comfortable with a modest level of risk, and believe in the future growth and success of Northern Credit Union.
We strongly advise members to have a thorough review of pages 19-28 of the Offering Statement, specifically focusing on comprehensive details regarding the associated risks tied to the acquisition of these shares.
Who should not purchase Class B Investment Shares, Series 2024?
Members with a short investment horizon or who anticipate needing access to the funds held in a Class B Investment Share within 5 years should avoid investing in this product. Additionally, individuals with a lower risk tolerance should thoroughly evaluate all associated risks before considering the purchase of Class B Investment shares. We highly recommend reviewing the Investment Share Offering Statement in its entirety to gain a comprehensive understanding of all terms and conditions.
Can I decide not to purchase prior to the offering closing?
You may exercise your right to reverse your decision to purchase these shares within two days, excluding weekends and holidays, following receipt of a copy of the offering statement, dated March 30, 2024, for the Class B Shares, Series 2024, by signing an unsubscribe form, at any Northern branch. The Credit Union will release the hold on funds immediately upon being informed of such reversal.
How do I purchase Class B Investment Shares?
If you believe Class B investment Shares could be a valuable addition to your investment portfolio, talk with a Class B Investment Share Specialist at your branch or reach out to the True North Hub at 1-866-413-7071 to discuss further and request an offering statement.
Share Offering Statement Request
Please fill out the form below to request a copy of the 2024 Share Offering Statement. To be eligible for this request, you must be a member of Northern Credit Union.
Disclaimer
* Dividend rates and payments are not guaranteed. Dividends may not be paid or may not be paid at the target rate; however, Northern Credit Union has historically always paid a dividend on its previous three series of Investment Shares. Past payment of dividends in no way predicts future ability to pay dividends at all or at the target rate. Funds for each member’s subscription will be placed in a holding account based on where the money originated and will remain there until the issue date. These shares are only available by obtaining an offering statement detailing all the terms, conditions, and risks of this investment.
