Osoyoos Indian Band Development Case Study

Dealing directly with the First Nation instead of with TD will be very beneficial since the Band will be able to adapt the loan requirements to the needs of the community. With such a large population and wide spread of age groups and income levels, this will be much more suitable than Option 1.

Furthermore, the greatest risk in this program is the possibility of loan default, which reinforces why Option 2 is a better suit. The Osoyoos Indian Band Development Corporation has achieved exponential growth in revenues over the past decade. Their most recent available annual revenue was $17,582,000 in 2013 (Chief Clarence Louie: The key to the future is building a strong economy). They are also known to have a strong credit rating with the banks they work with (Journey to Economic Independence). If TD operates a line of credit directly to the First Nation, there should be less of a chance of default due to the Band’s economic stability. When dealing directly with members of the Band, there is the issue of information asymmetry. TD has a lower ability to assess whether the information given to them

The Osoyoos Indian Nation has prospered over the years through leases and joint ventures. This has allowed them to develop successful businesses, such as NK’MIP Cellars, which is North America’s first Aboriginal owned and operated winery (OIBDC) The Band is currently looking for investment in multiple business projects, including Canyon Desert Golf Villas, Senkulmen Business Park and Spirit Ridge Resort Phase Two (OIBDC). Their land has great potential for opportunities in agriculture, eco-tourism, commercial, industrial and residential developments. They are constantly expanding their economy, which means an increased demand for investments and loans. If TD sets itself up as a reputable bank for the Band, they will look to TD ahead of other banks for their investment or borrowing