Hi-Alta seeks banking license and name change

Western-based broker network consolidator Hi-Alta Capital Inc. (TSE: HIA) has applied for a federal chartered bank license under the new banking legislation, CEO Scott Tannas announced at the company’s annual general meeting. Shareholders also approved a change of name for the company to Western Financial Group, which will trade on the Toronto Stock Exchange under the symbol “WES”.

Tannas believes that the withdrawal by the big bank groups from rural communities and toward centralized automated services has opened opportunities for smaller players to cater to the needs of these communities. Under the new bank legislation, an insurance company is permitted to operate as a bank, while restrictions remain in place against banks selling insurance products through their branches. “We have built up a truly western financial institution, and the new [company] name symbolizes our move to a higher level of service with the addition of investments and agency banking to our existing insurance business,” says Tannas.

Currently, the broker consolidator operates through 44 locations in Alberta, British Columbia and Saskatchewan, servicing about 140,000 customers with total annual revenue of around $22 million. Hi-Alta also has a stake in Jennings Capital Inc., an Alberta-based investment brokerage. In total, the broker consolidator sold about $200 million in RRSP savings last year.

Hi-Alta increased net income by more than 3-times to $426,700 for the first quarter of this year compared with $136,800 reported for the same period a year prior. Total revenue for the latest reporting period rose by 17% year-on-year to $5.9 million.