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After our announcement in November of 2008 about the launch of our initiative with Vancity, we were excited about having finally realized a large part of our dream. A financial institution was going to be launched - at first with an Ontario focus - but eventually nationally to address the needs of charities and non profits across the country. We began the process of hiring. And then the financial crisis began in earnest. And while we were relatively insulated from that, here in Canada, we were not entirely. Our partner institution was hard hit and had to make tough strategic choices, one of which was its decision to effectively sell the arm we were going to be operationally working with. Vancity had decided to sell Citizen's Bank largely to the TD. This decision meant that Vancity could no longer be a partner in going forward. As we had previously exhausted the list of organizations that would make potential partners - as well as being excited about Vancity being the partner - we were hugely disappointed, and aware that it would not be easy to go on. This means that the financial institution aspect of the work of Vartana will not be going forward. We came ever so close to achieving this dream. And now will share some of our story, many of our research findings and learnings, in the hope that initiatives like this in the future will be better positioned to succeed when they walk this path again. The key lesson is that we came close! Twice we almost had deals in place that would have made this a reality for the sector. This was a big dream, and while it didn't happen here, it has to be heartening to know that it is actually possible. And these dreams should continue to be pursued.

The background

The Vartana initiative has been underway for a number of years now starting in 2002. We started off with a simple dream based on the experiences a few of us had with non-profits previously, that new and better tools customized for non-profit organizations and charities were much needed. This was a foreshadowing of the development of the broader social finance agenda that has emerged more recently. A small group of brave individuals from the social sector, the private sector and the public sector came together as team members and board members to drive the initiative. The team members especially committed a great deal to the initiative in terms of the tremendous sacrifices they made. These worked with a board of leading lights to engage the social sector itself, the government and the banking sector.

The response we got back was overwhelming, this was a project that should be pursued. We were well positioned: Paul Martin was about to become prime minister, the social sector was hungry for new projects, the banking sector was open to collaboration, and there were private sector partners who were willing to commit a great deal to realize this vision. We got traction with the government and were in the budget and throne speech in 2004. We were also offered the funding we needed. But because it didn't line up well, and had complicated strings attached, we turned it down. A really tough decision. But we plugged away developing our plan. A key private sector partner, Deloitte, led the way doing incredible research and planning work for us. And this had us in good stead with the key regulators - the Office of the Superintendent of Financial Institutions (OSFI) and the Canadian Revenue Agency (CRA). As well as with others who wondered whether the project would be economically viable. In the meantime we played a key role on the social economy file, as well as in engaging the credit model people of a few banks.

In 2005, we heard directly from the Prime Minister and our file was made a priority for the then Minister of Social Development. What followed was an 8 month process of policy development against the background of the struggles of a minority government. When Belinda Stronach crossed the floor it made a huge difference to us! We continued to work with the department then known as Social Development Canada, until finally a file was approved by the government - $10 million, half for policy development, and half for financing our project. Unfortunately, again, the structure didn't work for us. And we had to turn it down. We then started to look in earnest at partnering more closely with the private sector.

We had heard a great deal of interest from Vancity over time, and began to talk to them, as well as consider other options. But it was clear they were the best partner. We worked closely with them and over 2 years carved out an agreement to collaborate to launch the new institution. That announcement was made in November. But sadly we now have to share the news that the project will not be going ahead.

The successes

There were great successes that need to be celebrated with the project. And the host of individuals who were willing to take this journey need to be thanked. We dreamt big, and several times were in a place where we could have achieved our vision. The next project might just be able to take that last step! Our wins include:

coming that close
working closely and collaboratively with the CRA to get charitable status for the proposed bank
working with a few of the banks engaging them on their credit models
huge support from private sector organizations, and voluntary sector organizations
playing a critical and behind the scene role on the social finance file which led to approximately $150M being invested in the social economy

The wrap up

We've been working pretty head to the ground over the last while which is why there haven't been much in the way of updates. But we're glad to share this with you. And to let you know that much more is to come. Our deep research into the sectors financial needs, the material and agreement from our getting charitable status for the bank, research into the value of financing for the sector including in job creation terms, as well as much more. All of that will be hosted on the vartana.org website. Thank you in the meantime for your interest and support.