The Province of Ontario Savings Office (POSO) was a

financial institution Financial institutions, sometimes called banking institutions, are business entities that provide services as intermediaries for different types of financial monetary transactions. Broadly speaking, there are three major types of financial insti ...

established by the

Government of Ontario The government of Ontario (french: Gouvernement de l'Ontario) is the body responsible for the administration of the Canadian province of Ontario. A constitutional monarchy, the Crown—represented in the province by the lieutenant governor� ...

Canada Canada is a country in North America. Its ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, covering over , making it the world's second-largest country by tot ...

in 1922 to provide a government-owned alternative to banks. The POSO was closed in 2003 when its assets were sold to the Quebec-based

Desjardins Group The Desjardins Group (french: Mouvement Desjardins) is a Canadian financial service cooperative and the largest federation of credit unions (french: caisses populaires) in North America. It was founded in 1900 in Lévis, Quebec by Alphonse Des ...

cooperative of ''caisses populaires'' (credit unions) to form

Desjardins Credit Union The Desjardins Credit Union was an autonomous Ontario credit union whose creation was funded by the Desjardins Group in a 2003 buyout of the Province of Ontario Savings Office . As of 2010, the credit union had 50,000 members and CDN$1.4 bill ...

. In 2011, Desjardins Credit Unions in Ontario were transferred to

Meridian Credit Union Meridian Credit Union Ltd. is a Canadian credit union. It was formed on 1 April 2005 through the merger of Niagara Credit Union and HEPCOE Credit Union. It is insured by the Financial Services Regulatory Authority of Ontario. History Meridia ...

History

The Savings Office was created by the

United Farmers of Ontario The United Farmers of Ontario (UFO) was an agrarian and populist provincial political party in Ontario, Canada. It was the Ontario provincial branch of the United Farmers movement of the early part of the 20th century. History Foundation and r ...

government of

Premier Premier is a title for the head of government in central governments, state governments and local governments of some countries. A second in command to a premier is designated as a deputy premier. A premier will normally be a head of governm ...

Ernest C. Drury Ernest Charles Drury (January 22, 1878 – February 17, 1968) was a farmer, politician and writer who served as the eighth premier of Ontario, from 1919 to 1923 as the head of a United Farmers of Ontario– Labour coalition government ...

to provide loans to farmers and other small borrowers who traditionally had limited access to credit, as well as to offer

savings accounts A savings account is a bank account at a retail bank. Common features include a limited number of withdrawals, a lack of cheque and linked debit card facilities, limited transfer options and the inability to be overdrawn. Traditionally, trans ...

paying interest on small deposits, something Canadian chartered banks at the time did not do. POSO's authority to make loans was withdrawn by Premier

Howard Ferguson George Howard Ferguson, PC (June 18, 1870 – February 21, 1946) was the ninth premier of Ontario, from 1923 to 1930. He was a Conservative member of the Legislative Assembly of Ontario from 1905 to 1930 who represented the eastern provincia ...

Conservative Conservatism is a cultural, social, and political philosophy that seeks to promote and to preserve traditional institutions, practices, and values. The central tenets of conservatism may vary in relation to the culture and civilization i ...

government that took office in 1923, and the institution's operations were effectively reduced to that of a government-run

savings bank A savings bank is a financial institution whose primary purpose is accepting savings account, savings deposits and paying interest on those deposits. History of banking, They originated in Europe during the 18th century with the aim of providi ...

, offering savings, demand-deposit and term-deposit accounts at interest rates slightly higher than those available from commercial banks. At the time of its closure, POSO had twenty-eight branches serving about 50,000 customers, approximately 100,000 accounts with deposits totalling about $

CAD Computer-aided design (CAD) is the use of computers (or ) to aid in the creation, modification, analysis, or optimization of a design. This software is used to increase the productivity of the designer, improve the quality of design, improve co ...

2.8 B, and was responsible for coordinating the sale and distribution of

Ontario Savings Bond Ontario Savings Bonds (OSBs) were bond securities offered by the province of Ontario from 1995 to 2018. Unlike the Canada Savings Bond, OSBs were sold only to residents of Ontario, and their principal and interest were backed by the Province of On ...

Sale and closure

In the provincial

budget A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environmenta ...

of 2001, Ontario

finance minister A finance minister is an executive or cabinet position in charge of one or more of government finances, economic policy and financial regulation. A finance minister's portfolio has a large variety of names around the world, such as "treasury", " ...

Jim Flaherty James Michael Flaherty (December 30, 1949 – April 10, 2014) was a Canadian politician who served as the federal minister of finance from 2006 to 2014 under Conservative Prime Minister Stephen Harper. First elected to the Legislative Assembly ...

signalled the government's intention to sell POSO's assets to the private sector, announcing that the Province was "getting out of the banking business" as part of the government's privatization program to end "wasteful activities that could be eliminated". Critics, most notably the

Ontario Public Service Employees Union The Ontario Public Service Employees Union (OPSEU; french: Syndicat des employés de la fonction publique de l'Ontario EFPOlink=no) is a trade union representing public sector employees in the province of Ontario, Canada. It claims a membership ...

, the provincial public-sector union that represented POSO's two hundred employees, objected that the sale was ideologically motivated. The union noted that POSO turned an annual profit of about $10 million, and that, as POSO's deposits went to Ontario's consolidated revenue fund, from which they could be loaned to the government at rates below those available from private lenders, the government would be increasing its borrowing costs at a time when its stated objective was eliminating the province's

budget deficit Within the budgetary process, deficit spending is the amount by which spending exceeds revenue over a particular period of time, also called simply deficit, or budget deficit; the opposite of budget surplus. The term may be applied to the budget ...

. An unsuccessful petition campaign was mounted to attempt to convince the government to abandon its plans for the sale, but the assets were sold to the

Desjardins credit union The Desjardins Credit Union was an autonomous Ontario credit union whose creation was funded by the Desjardins Group in a 2003 buyout of the Province of Ontario Savings Office . As of 2010, the credit union had 50,000 members and CDN$1.4 bill ...

and POSO ceased operations on April 1, 2003.

References

Defunct banks of Canada Former Crown corporations of Canada Defunct Ontario government departments and agencies Banks established in 1922 1922 establishments in Ontario 2003 disestablishments in Ontario Banks disestablished in 2003 Desjardins Group Meridian Credit Union 2003 mergers and acquisitions {{Canada-corp-stub

History

Sale and closure

See also

References