Government assistance proposed up to now is probably not enough to help individuals and businesses, believes the boss of the Desjardins group; Guy Cormier.
In the space of two weeks, Ottawa and Quebec have injected nearly $ 200 billion into the economy, in the form of assistance to workers and employers. But as the duration of the isolation is unknown, the extent of damage remains difficult to assess, supports the financial.
“If, in June, we restart the economy, it may be that the current aid will be sufficient. But if one is in containment, until August or September, which, I think, could happen, it is clear that it will take other measures. ”
It welcomes the timely action of the governments of Trudeau and Legault, he recognizes that confusion exists at the present time.
“It is necessary to decipher the measures that have been created. We need support from entrepreneurs, ” he says, insisting on the fact that his financial institution will be very proactive with its customers.
Reassuring but not too much
They have to worry about the state of their portfolio ? Guy Cormier is careful, is more than reassuring. “It depends on the situation of each. Someone who is five or ten years of retirement will be the time to do it again, if we rely on the history. ”
As for the pensioners, he hoped that they had already secured their assets in anticipation of their old days. The more we advance in age, the more our approach must be cautious, ” he recalls. “The people who were a lot invested in the Stock market, it will take time to straighten out their portfolio. ”
How are you personally in this crisis (work, home, family, etc)
I saw it at home basically. I have an office, once a week I come to the complexe Desjardins for interviews or see employees. I try to be home as possible. Sure it poses some challenges, but it is quite challenging. I’m talking about the 45, 000 employees. We want to inform them and answer their questions. The management team meets each day to follow the decision and to take decisions, to manage the Movement daily. People need insurance, life insurance, automobile, we continue our digital transition. We managed very quickly to put 35, 000 to 45, 000 employees working at home. Being an essential service, it also has thousands of employees in the boxes, the centers of contact to the customer. The morale of the troops, the level of stress and anxiety is to take into account. We saw all of the personal property in our families at this time.
What was your first priority, when the crisis broke?
Ensure the safety of our members and employees. It was not obvious, because the directives were not the same from one province to the other. It has put in place the measures that are most demanding for all our employees, regardless of the province.Also, as a financial institution, we want to ensure that the access to cash, and programs, our ability to follow the needs of our members to be there. We has among the best liquidity ratio in north America at this time.
You have experienced the attacks of September 11, 2011 and 2008. There are there things that you learned from these crises that are useful to you today ?
In 2008 I was a DG in a box here in Montreal. In 2001, I was in the service points. What I learned, it is communication. It is necessary to keep his blood cold. Yes it moves fast, but when it manages 45,000 employees, the last thing to do is to panic. We need to accept that it is chaotic but it works to get the answers.Financially the important to responsibly manage our members ‘ assets. You have to get up in the morning remembering that this money does not belong to us, that it is to our members. And that it is prudent and well capitalised.
Is it that you can reassure Quebecers that you’re going to show compassion for individuals and SMES in troubled waters ?
The answer is yes. From march 16, we were the first to introduce relief measures. It receives 1,000 applications per day of deferral or a moratorium of payment for the companies. It is always a yes answer. It has over 100,000 applications currently in the. It is every day in contact with the authorities to put measures. It is not expected that members call us. For individuals, it was announced several relief measures : payment deferral, review the financing of certain loans. Thursday, it was announced that next week we are going to allow a loan of last resort of $ 3000. Any member with a loss of wages related to the COVID-19 will be entitled to a loan of $ 3000 in six months, at a rate of 4.97 %. To all members who ask for relief measures, we will automatically offer a reduction in their interest rate 10,97% instead of 19 % on their credit card.
Is what Quebecers must fear for their retirement? And the current retirees ?
It depends on the situation of each individual. Some households have lost income, other two. In 2008 there were concerns about a reduction of 40% and 50% (of the portfolio). But after the market recovery 500 %. Someone who is within 5-10 years of retirement is the probability of redo, if it relies on history. Someone who is already retired, she should already have an investor profile which has secured its assets. If it does not, in fact, it is his choice. In some cases, they have not suffered any fall. In other cases, those who were significantly invested in the stock market, it may be time to review the portfolio..
Is it that the plans using the federal and Quebec are sufficient to revive the economy ?
Ottawa and Quebec have been very proactive in the face of this unprecedented situation. In 2-3 weeks the levels have injected several are. At the level of the monetary policy has been much more rapid than in 2008. There is still the extent of the damage. It is difficult to say whether these measures are sufficient, because no one knows the magnitude and duration of containment measures.If in June we restart the economy, maybe it was enough. But if one is in action until August and September, what I think could happen, it is clear that it will take other measures to help. Our governments are listening and adapting. It is also necessary to decipher the action current. We need support from entrepreneurs.
The Bank of Canada has lowered somewhat the prime rate to the banks. Is that these cuts will be recycled back to consumers and SMES ?
It has already adjusted some rates on some credit cards, 19 % to 10.9 %. All the people who have variable mortgages have lowered their prices. But the costs of procurement of funds increase and it affects the costs.
Quebec has put in place a committee of priorities to prepare for the economic recovery. Do you have priorities to propose to the prime minister Legault ?
Initially, all the manufacturing sector : it’s going to have to look at it quickly. In particular, companies that export goods and services in construction, infrastructure, it will have to work actively. Ditto for the tourism area which will be affected. We know it affects a lot of self-employed workers and smes. We could have a campaign to travel to Quebec to discover our regions.
Our largest economic partner is the United States. This country has become the epicenter of the contagion. Do you believe that this will have a major impact on your business?
This is a good question ! It is the balance to seek between health and business. The worst thing that could happen is that we close our economic borders are too long. It is important to avoid protectionism. Our SMES are exporting a lot, it will be necessary to remove as quickly as possible the trade barriers to create jobs. It is difficult to know how long this will be sustainable. How long the remedy of health put forward in the measure or the economic crisis could also have serious repercussions. I hope that in the summer we will see the economy come back a little.
Is it that you are now experiencing new ways of working and of doing business that will have impacts after the crisis ? (ex: the example of call centres and fewer branches physical, less of the headquarters, etc)
It is not there. We already had a lot of telework, thousands of representatives mortgage of project managers in telework. This is not new, and unprecedented. There it accelerates. Are we going to learn lessons to reduce congestion in road transport, for work-life balance? We are going to have this reflection.
What will happen to your turn to investment green ? Do you think speeding it up or rather put it aside ?
I think he’s going to have to continue to accelerate. It is already a leader. It was the fund members. We wanted to gradually reduce our investments in the oil industry. We are going to look at that on a case-by-case basis.
What have you learned so far from this crisis in terms of human resources ? Your business will come out of the crisis with many employees, or less ?
Close point-of-service, the answer is no. It is important to be physically in all regions of Quebec. It has several expansion projects. It is not in a state of mind to put on the feet or reduce our work force.
Is this the end of the banking system and/or financial as we know it?
No. Each time there is a crisis, we think it is the end of the banking system. But with the benefit of hindsight it is one of the countries with the systems, the more resilient and strong. There has not been such great impacts in the canadian system in 2008. Is that our measures of risk assessment will change, the answer is yes. In the same way that there are 4 or 5 years, we have adapted our measures to deal with cyber attacks.
Why the large financial institutions, did they not see it coming? What is this translated to their actual ability to assess the risk?
The institutions have several risk assessment tools such as epidemics, cyber attacks, natural disasters, etc, When I look at the measures put forward, the levels of capitalization, liquidity, I say we have learned from the 2008 crisis. From the beginning of the year we were in contact with the authorities concerning the coronavirus.
Is it that the banks, which were bailed out by place by the State, will in turn come to these difficult times?
We it’s been 120 years that it is much more than a financial institution.