Desjardins is always there for its members and clients
AN ACTIVE AND INVOLVED GROUP. First-quarter highlights include Desjardins Group's leadership in managing the COVID-19 pandemic situation. The cooperative group quickly implemented measures for members and clients most affected by the situation.
The cooperative group has rolled out a number of relief measures since the pandemic began.
Lévis, May 13, 2020 - For the first quarter ended March 31, 2020, Desjardins Group, Canada's leading financial cooperative group, recorded surplus earnings before member dividends of $285 million, down $116 million or 28.9% compared to the corresponding quarter of 2019. This decrease in surplus earnings was due to the negative financial consequences of the COVID-19 pandemic. These consequences include an increase in the provision for credit losses, mainly as a result of the significant deterioration in the economic outlook, the rise in travel insurance provisions after the Canadian government's announcement of travel restrictions, the increase in credit balance insurance provisions, and the decrease in the fair value of derivative financial instruments, due in particular to the volatility of financial markets and credit spreads. Sustained growth in caisse network operations and the solid performance of the Property and Casualty Insurance segment, which reported higher premium income and a favourable claims experience compared to the first quarter of 2019, mitigated the decrease in surplus earnings.
The amount returned to members and the community totalled $104 million, including a $77 million provision for member dividends, $16 million in sponsorships, donations and scholarships, and $11 million in Desjardins Member Advantages.
Despite the impacts of the COVID-19 pandemic on Desjardins Group's financial results for the first quarter of 2020, the cooperative group is still a financial institution with a solid foundation that is capable of withstanding an economic slowdown.
"Last March, Québec and Canada were temporarily shut down to slow down the spread of the COVID-19," said Desjardins President and CEO, Guy Cormier. "Desjardins was one of the first financial institutions to put in place relief measures for its members and clients. We managed to return $104 million to our members and the community, despite the pandemic's financial impact. Desjardins was able to quickly adapt to the situation, thanks to its wide range of online services and the 38,000 employees who were able to work from home. Our financial stability will help us contribute the social and economic recovery, especially through the $150 million GoodSpark Fund announced at the end of April. I would also like to thank our members, clients and employees for their courage and resilience in these troubled times".
COVID-19: Desjardins Group's rapid response
On March 11, 2020, the World Health Organization declared a COVID-19 pandemic. On March 13, 2020, the Québec government declared a public health emergency throughout Québec. Meanwhile, the Canadian government introduced various protection measures during the first quarter of 2020.
On March 16, Desjardins Group became one of the first financial institutions to implement relief measures to help support members and clients who might temporarily experience difficulty in meeting their financial obligations.
On March 18, Desjardins Group reduced the number of service points open to 320 to limit the spread of
COVID-19 pandemic. It also reviewed the hours of physical accessibility to its points of service.
On March 20, Desjardins increased its contactless payment limit on Desjardins POS terminals from $100 to $250. Desjardins credit cardholders can take advantage of the temporary increase in pharmacies, grocery stores and convenience stores.
On March 27, the cooperative group took another step toward limiting the spread of the virus by encouraging members and clients to sign up to receive their government benefits by direct deposit instead of by cheque. It also said that it would reimburse fees to members who exceeded the number of allowed transactions under their plans.
Members and clients with travel insurance were able to get travel assistance that helped them book tickets for flights back to Canada, find new accommodations, organize translation services and coordinate next steps with the government.
On April 2, Desjardins Group announced that it would temporarily reduce the annual interest rate to 10.9% for Visa and MasterCard credit card holders who have been granted a payment deferral on a Desjardins financing product. It also said it would offer emergency loans of up to $3,000 at an attractive rate of 4.97% for individual members most affected by the pandemic. The cooperative group also introduced new measures for young people, seniors and community organizations.
On April 6, Desjardins Group's property and casualty insurance subsidiaries announced a discount on car insurance premiums for people under lockdown who are covered by Desjardins personal and business P&C insurance.
By the beginning of May 2020, Desjardins Group received more than 616,000 requests for relief measures. Of these requests, more than 74,000 were for payment deferrals on credit cards, Accord D financing and automobile loans. In terms of loans and lines of credit, a total of nearly 111,000 applications were also received, including more than 89,000 relating to mortgage loans. As for business members and clients, a total of more than 23,000 requests were received. Finally, more than 408,000 requests were received concerning automobile insurance.
In addition to these measures, Desjardins set up partnerships with the Québec and federal governments in order to offer solutions to members and clients. The cooperative group will continue to offer them support so they can get back to business.
Support for economic and social recovery
On April 29, Desjardins announced its initial strategies for contributing to the economic recovery and to regional development. The strategy consists of five initiatives worth more than $150 million to promote innovation and entrepreneurship that will help businesses and community organizations get back to work. One of these initiatives, the GoodSpark Fund, will provide social and economic support to communities.
Giving back to the community
During this pandemic, Desjardins has been more involved in people's lives than ever and quickly signalled its desire to participate actively in the economic recovery that would follow. Over the past few weeks, many initiatives have been established to help the entire community.
- Support for youth:
- Psychological and legal hotline for members aged 30 and under.
- Donation of $210,000 to Jeunesse, J'écoute/Kids Help Phone and Alloprof.
- Increase in the Desjardins Foundation scholarship fund to $1.8 million for this year.
- Support for the elderly:
- $300,000 in financial support to the Caregiver Support service.
- In Charge of Your Life and Your Property program to protect the elderly from financial abuse and fraud.
- Merit Service (60+ years): $4 discount on plan service charges.
- Support for organizations:
- Donation of $475,000 to counter the humanitarian crisis caused by the COVID-19 pandemic
(Centraide, Red Cross, Food banks of Quebec and Feed Ontario).
- Donation of $475,000 to counter the humanitarian crisis caused by the COVID-19 pandemic
- Support for the government of Québec:
- Donation of more than 20,000 N95 masks and 40,000 surgical masks.
- Support for economic recovery:
- $150 million GoodSpark Fund for projects in all regions.
- $10 million Momentum Fund in support of business growth and job creation projects.
- Partnership with Google and Startup Montréal to hold an innovation competition.
- Partnership with La Ruche Québec to encourage people to buy local.
- Partnership with the École d'Entrepreneurship de Beauce to assist 500 entrepreneurs.
Desjardins is one of three North American financial institutions recognized by the United Nations as a responsible institution in the context of the COVID-19 pandemic. UNEP-FI, a sub-group of the United Nations, promotes responsible finance principles that the financial sector can follow to actively contribute to the development of a more sustainable and responsible economy.
Desjardins is constantly innovating to meet the needs of its members and clients. In today's environment, the cooperative group has further leveraged its ingenuity to limit the spread of COVID-19:
- 38,000 out of 48,000 employees have been able to work from home.
- Stronger public health measures were introduced in our points of service and offices.
- More than 95% of transactions can be completed without having to go to a point of service, whether in one of our 1,689 ATMs, by AccèsD Internet, telephone or mobile phone.
- Contactless payment limit on Desjardins payment terminals raised from $100 to $250 for holders of Desjardins credit and debit cards.
- Many procedures were automated for members and clients (online forms, direct deposit registration).
Before the pandemic, nearly 92% of member/client interactions with Desjardins were online. Now this figure is closer to 94%.