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Oct. 27 (Bloomberg) -- Cooperative financial institutions such as credit unions should play a larger role in the global financial sector because they are owned by members and less focused on quarterly results, the head of Canada’s largest credit union group said.
Monique Leroux said some clients of large banks were frustrated by losses posted during the financial crisis, leading to protests on Wall Street that began last month.
“When you look at the situation on Wall Street and other countries, it shows a situation where people feel disconnected from the large financial institutions in the world,” said Leroux, president and chief executive officer of Caisse Centrale Desjardins du Quebec.
Banks and brokers have posted more than $2 trillion in losses during the financial crisis that began in the third quarter of 2007, according to Bloomberg data. Many cooperatives around the world, including in Europe and Asia, are closely held and are managed “with less of a perspective towards quarterly results,” Leroux said.
“What the cooperative model brings is really a connection of people and the economy,” said Leroux. “The cooperative model emphasizes the importance of the equilibrium between human capital and financial capital.”
The top 300 cooperatives in the world have combined revenue of more than $1.1 trillion and have more than 1 billion clients, Leroux said. Decisions at cooperative institutions are made by a large group of individuals that represent their members, she said.
“They are not making headlines very often, but their contribution in the economy is absolutely fantastic,” Leroux, 56, said today in a telephone interview.
Desjardins will be a host of the Quebec International 2012 Summit of Cooperatives in Quebec City from Oct. 8 to Oct. 12, an event that Leroux will be promoting next week in New York. It will be part of the United Nations International Year of Cooperatives.
“We want to build a global network of cooperatives to make a sort of influence in economic and political circles,” Leroux said. “We believe the summit will be a crystallization of that collective effort.”
Desjardins, the largest Quebec-based financial institution and based near Quebec City in Levis, has C$173 billion ($174 billion) in assets.
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