Credit unions review welcomed

[TotalMayhem]

The appointment of independent consultants to carry out a review of the credit union sector in Ireland has been welcomed by the Irish League of Credit Unions.

Chief executive of the Irish League of Credit Unions, Kieron Brennan, said he sees the review as an opportunity to strengthen the credit union movement, and allow it to take a more influential position in Irish society.

Full story here (http://www.irishtimes.com/newspaper/breaking/2010/0728/breaking13.html).

gotta love the independent consultants, probably looking whether there's any capital left for the government to raise. :)

[concernedparent]

Probably wont even raise capital, just see how much they can legally redirect

[Captain Con O'Sullivan]

We had a thread on here some weeks back the title of which i cannot recall but I well remember the representative of the Credit Union Association back in May/June telling an Oireachtas committee that sure the Credit Unions were fine and that they had reserves and a system which was sound.

So now we hear there is going to be an independent review ... something isn't right.

[TotalMayhem]

just see how much they can legally redirect

i like the way you put it. it doesn't even remotely imply daylight robbery. :D

[ang]

We had a thread on here some weeks back the title of which i cannot recall but I well remember the representative of the Credit Union Association back in May/June telling an Oireachtas committee that sure the Credit Unions were fine and that they had reserves and a system which was sound.

So now we hear there is going to be an independent review ... something isn't right.

Hi Captain,

That thread including your post with link to the committee debate is here:-

http://www.politicalworld.org/showthread.php?t=2476&highlight=oireachtas+committee+credit+union

[Captain Con O'Sullivan]

cheers ang- that was good of you ...

[Captain Con O'Sullivan]

Here's the relevant Oireachtas committee meeting record from 27th May, just two months ago detailing how everything with the Credit Union system was fine...

http://debates.oireachtas.ie/DDebate.aspx?F=ERJ20100527.xml&Node=H2#H2

[Captain Con O'Sullivan]

Here is an extract to save people trawling along that annoying system they have for recording minutes on the oireachtas online record;

Extract: James O'Brien is the Credit Union Registrar.

Mr. James O’Brien: Credit unions are important and we believe the credit union movement will become even more important in the near future because of the shape of the financial sector. However, we should not be complacent. The credit union sector has done reasonably well but we need to be able to look forward and to take preventative measures where we see a risk. This is a preventative measure. We are not saying there are significant problems at present; we are looking a year to 18 months ahead.

Deputy Kieran O’Donnell: The strategic review could be completed within that timeframe.

Mr. James O’Brien: If the strategic review is completed in 18 months, it might be too late. We are now looking at a period where the stresses are increasing dramatically. We want to put a preventative measure in place where we help members while protecting the credit unions and the savers.

Deputy Kieran O’Donnell: How many credit unions are meeting the 10% capital ratio?

Mr. James O’Brien: We set a benchmark of 10% but we have also provided transitional arrangements for credit unions of 7.5%. The majority of credit unions are now meeting that 7.5%. A significant number of credit unions is also meeting the 10%.

Deputy Kieran O’Donnell: What would that figure be?

Mr. James O’Brien: About 84% of those meeting the 7.5%.

Deputy Kieran O’Donnell: That is 84% numerically speaking?

Mr. James O’Brien: Yes. They have total reserves of more than 10% of their assets.

Deputy Kieran O’Donnell: The assets are around €14 billion. What percentage of the top 100 credit unions are making 10%?

Mr. James O’Brien: We do not have figures for the top 100 credit unions.

Deputy Kieran O’Donnell: It would be reasonable to say that the credit union movement is unlike the banking sector. It is in a reasonably sound financial state.

Mr. James O’Brien: I said at the outset that if one looks at the sector overall, it is in shape but we do not want to be complacent.

Deputy Kieran O’Donnell: I accept that.

[TotalMayhem]

an opportunity to strengthen the credit union movement, and allow it to take a more influential position in Irish society.

Not sure if I like the sound of this. One would think, the Irish society is sick of financial institutions in influential positions.

[BrendanGalway]

Here is an extract to save people trawling along that annoying system they have for recording minutes on the oireachtas online record;


Thats Horrible reading. We have seen a similar style to this a few times now on this site. The same question is asked repeatedly and the guy on the other end fudges his answers. And it of course emerges that none of his fluff stood up to scrutiny.

If only we cared....

[TotalMayhem]

A very desperate man at the Galway Races:

http://img194.imageshack.us/img194/4065/20100729034120clipboard.jpg

[concernedparent]

Here is an extract to save people trawling along that annoying system they have for recording minutes on the oireachtas online record;

Extract: James O'Brien is the Credit Union Registrar.

Mr. James O’Brien: Credit unions are important and we believe the credit union movement will become even more important in the near future because of the shape of the financial sector. However, we should not be complacent. The credit union sector has done reasonably well but we need to be able to look forward and to take preventative measures where we see a risk. This is a preventative measure. We are not saying there are significant problems at present; we are looking a year to 18 months ahead.

Deputy Kieran O’Donnell: The strategic review could be completed within that timeframe.

Mr. James O’Brien: If the strategic review is completed in 18 months, it might be too late. We are now looking at a period where the stresses are increasing dramatically. We want to put a preventative measure in place where we help members while protecting the credit unions and the savers.

Deputy Kieran O’Donnell: How many credit unions are meeting the 10% capital ratio?

Mr. James O’Brien: We set a benchmark of 10% but we have also provided transitional arrangements for credit unions of 7.5%. The majority of credit unions are now meeting that 7.5%. A significant number of credit unions is also meeting the 10%.

Deputy Kieran O’Donnell: What would that figure be?

Mr. James O’Brien: About 84% of those meeting the 7.5%.

Deputy Kieran O’Donnell: That is 84% numerically speaking?

Mr. James O’Brien: Yes. They have total reserves of more than 10% of their assets.

Deputy Kieran O’Donnell: The assets are around €14 billion. What percentage of the top 100 credit unions are making 10%?

Mr. James O’Brien: We do not have figures for the top 100 credit unions.

Deputy Kieran O’Donnell: It would be reasonable to say that the credit union movement is unlike the banking sector. It is in a reasonably sound financial state.

Mr. James O’Brien: I said at the outset that if one looks at the sector overall, it is in shape but we do not want to be complacent.

Deputy Kieran O’Donnell: I accept that.

What does 84% numerically speaking mean?:confused:

I thought 84% was a percentage of another number?

its a while since I graced the corridors of education, but have things changed that much.:confused:

[Captain Con O'Sullivan]

Deputy Kieran O’Donnell: How many credit unions are meeting the 10% capital ratio?

Mr. James O’Brien: We set a benchmark of 10% but we have also provided transitional arrangements for credit unions of 7.5%. The majority of credit unions are now meeting that 7.5%. A significant number of credit unions is also meeting the 10%.

I think its worth highlighting that exchange in particular. if I'm reading it right the Deputy is asking how many of the credit unions are meeting the regulatory 10% of capital (presumably to loan book ratio?) requirement.

The answer is extremely evasive- seems to me to say 'weve revised the ratio downwards to 7.5% and called it a 'transition rate' which says to me that they've moved the goalposts rather than ensure compliance.

The other non-accountancy magic words in there are 'majority' and 'significant'. These answers should be noted for their attempt at Jesuitry.

[ang]

Tom Appleby is a little concerned about Credit Unions:-


The issue of directors' loans at credit unions, believed to be widespread in some parts of the country, has the potential to cause major conflicts of interest, the corporate watchdog Paul Appleby has said.


http://www.independent.ie/business/irish/appleby-warns-of-credit-union-director-loans-risk-2278305.html

[TotalMayhem]

The issue of directors' loans

this sounds vaguely familiar. :mad:

[homer]

Credit Unions since started in this country about 1958 are one of the most successful voluntary movements of modern times.

All directors are voluntary officers. Any loans to directors must go before a full CU Board of Directors meeting and be approved by a majority.

DIrectors serve a three year term and must then seek re-election.

Credit unions have a very detailed audit each year, and must hold an AGM of their members where their entire financial operation can be questioned.

CU's have avoided the excesses of the property bubble, as they did not lend into that market

[Captain Con O'Sullivan]

Judging by the answers given by the registrar to the Oireachtas committee Credit Unions are also supposed to have a 10% reserve to loan-book ration which has suddenly become recast to be 7.5% which is a requirement that the registrar appears able to move at will.

Thats presumably how they've managed to be able to say that the majority of credit unions are alright- the question that wasn't asked was 'if the reserve was 10% would there still be a majority of credit unions in the clear?'

There's a very big gap between theory and practice in Irish financial institutions and the evasive answers to the Oireachtas committee are not making anyone confident in the Credit Union system.

I'm sure there are regulations about Directors of Credit Unions- but were and are they being adhered to?

How much would anyone like to bet?

[Captain Con O'Sullivan]

Credit Unions since started in this country about 1958 are one of the most successful voluntary movements of modern times.

All directors are voluntary officers. Any loans to directors must go before a full CU Board of Directors meeting and be approved by a majority.

DIrectors serve a three year term and must then seek re-election.

Credit unions have a very detailed audit each year, and must hold an AGM of their members where their entire financial operation can be questioned.

CU's have avoided the excesses of the property bubble, as they did not lend into that market


How come the Garda Credit Union in Dublin lent something like 800,000 to a Garda to buy a pub? That particular Credit Union is a running joke for the amount of mad lending its given out...

[Captain Con O'Sullivan]

Toxic loans tarnish the garda credit union books
Experienced officers 'worried' over colleagues' boom-time borrowing

That credit union was offering bridging loans and 'according to members, the credit union has been giving substantial loans in recent years, including some for the purchase of apartments, second homes and cars. The outstanding €780,000 loan is understood to have been paid out to buy a pub.'

http://www.independent.ie/national-news/toxic-loans-tarnish-the--garda-credit-union-books-2007218.html

[ang]

Some Credit Unions have been involved in property development:-


Officials at the financial regulator are particularly concerned that credit unions which have lent to small businesses or for property development could face rapid and overwhelming loan losses, putting members' savings at risk.


http://www.tribune.ie/business/article/2010/jun/20/state-to-bail-out-credit-unions-amid-default-fears/

[ang]

Financial Regulator has said today that Credit Unions are underprovisioning by 40 percent and he intended on dealing with this problem.

More Here:-

http://www.forexyard.com/en/news/Irish-credit-unions-a-worry-regulator-2010-10-06T110822Z

[eoinmn]

The independent consultants are Grant Thornton. They have sent a survey to each credit union to asses their financial situation. The survey had to undergo several revisions.
Some of the questions are irrelevant, bordering on bizzare.

[Captain Con O'Sullivan]

Strangely enough the Registrar for Credit Unions was busy telling an Oireachtas Committe on this very subject about 12 or 15 weeks back that there was no problem at all at all with the credit unions and specifically saying that they were adequately capitalised;

From post 17 above (July 2010);

'Judging by the answers given by the registrar to the Oireachtas committee Credit Unions are also supposed to have a 10% reserve to loan-book ration which has suddenly become recast to be 7.5% which is a requirement that the registrar appears able to move at will.

Thats presumably how they've managed to be able to say that the majority of credit unions are alright- the question that wasn't asked was 'if the reserve was 10% would there still be a majority of credit unions in the clear?'

There's a very big gap between theory and practice in Irish financial institutions and the evasive answers to the Oireachtas committee are not making anyone confident in the Credit Union system.

I'm sure there are regulations about Directors of Credit Unions- but were and are they being adhered to?

How much would anyone like to bet?'

[eoinmn]

I'm sure there are regulations about Directors of Credit Unions- but were and are they being adhered to?
In the vast majority, if not all, of credit unions, yes the regulations were being observed, I reckon.

It should be noted though..
That every quarter the credit unions must send a list of directors' loans to the regulator. In the banks, this was only every year, hence Seanie was able to use "Bed and Breakfasting" to get around the reporting.

When you look at what went on in banking in Ireland, credit unions are not the bad guys. None will have to be bailed out by the taxpayer.

[eoinmn]

Financial Regulator has said today that Credit Unions are underprovisioning by 40 percent and he intended on dealing with this problem.


And he has changed the regs recently in order to increase provisions.

My advice is look at the dividend your local credit union offers this year. By the dividend judge them.

[Captain Con O'Sullivan]

The Registrar reported to the Oireachtas just a few months ago that the provision percentage was 10% for each credit union and then said something about that having been shifted to 7.5% which meant that the majority were okay.

So essentially the goalposts were shifted.

[Captain Con O'Sullivan]

Here is the relevant extract and a link to the Oireachtas report by the Credit Union Registrar in May of this year;

'Extract: James O'Brien is the Credit Union Registrar.

Mr. James O’Brien: Credit unions are important and we believe the credit union movement will become even more important in the near future because of the shape of the financial sector. However, we should not be complacent. The credit union sector has done reasonably well but we need to be able to look forward and to take preventative measures where we see a risk. This is a preventative measure. We are not saying there are significant problems at present; we are looking a year to 18 months ahead.

Deputy Kieran O’Donnell: The strategic review could be completed within that timeframe.

Mr. James O’Brien: If the strategic review is completed in 18 months, it might be too late. We are now looking at a period where the stresses are increasing dramatically. We want to put a preventative measure in place where we help members while protecting the credit unions and the savers.

Deputy Kieran O’Donnell: How many credit unions are meeting the 10% capital ratio?

Mr. James O’Brien: We set a benchmark of 10% but we have also provided transitional arrangements for credit unions of 7.5%. The majority of credit unions are now meeting that 7.5%. A significant number of credit unions is also meeting the 10%.

Deputy Kieran O’Donnell: What would that figure be?

Mr. James O’Brien: About 84% of those meeting the 7.5%.

Deputy Kieran O’Donnell: That is 84% numerically speaking?

Mr. James O’Brien: Yes. They have total reserves of more than 10% of their assets.

Deputy Kieran O’Donnell: The assets are around €14 billion. What percentage of the top 100 credit unions are making 10%?

Mr. James O’Brien: We do not have figures for the top 100 credit unions.

Deputy Kieran O’Donnell: It would be reasonable to say that the credit union movement is unlike the banking sector. It is in a reasonably sound financial state.

Mr. James O’Brien: I said at the outset that if one looks at the sector overall, it is in shape but we do not want to be complacent.

Deputy Kieran O’Donnell: I accept that.'

27th May 2010 http://debates.oireachtas.ie/DDebate.aspx?F=ERJ20100527.xml&Node=H2#H2

[ang]

Sean Sherlock TD is worried that we could lose our Credit Unions:-


Financial Regulator Matthew Elderfield signalled he would not go easy on the voluntary movement which he said had worryingly low cash reserves.

The banking watchdog, which is pouring through the accounts of credit unions across the country, said they have on average 40% less money set aside than they should for bad loans.

“That’s a worry to me,” Mr Elderfield told an Oireachtas committee.

The remarks have sparked fears the Financial Regulator will savage the credit union movement by applying the same strict rules brought in to overhaul the banks.

Sean Sherlock, Labour TD for Cork East, said Leeds-born Mr Elderfield needed to realise the unique place credit unions have in Irish society.

“He’s going to strangle a lot of robust credit unions because he’s going to apply a blanket provisioning arrangement on them,” he said.

“He needs to realise the cultural and social arrangements in Ireland which still allow credit unions to survive and flourish.”

Read more: http://www.breakingnews.ie/ireland/regulator-warned-against-replacing-credit-unions-476690.html#ixzz11bNjmrAX

[Captain Con O'Sullivan]

Its the 'cultural and social arangements' around the banking and finance sectors in Ireland and the gap between those arrangements and proper corporate governance that has the country facing international default.

This TD seems to be indicating the regulator should look the other way. He should be slapped down immediately.

[monty cardigan]

@Captain
Have a gander here (http://www.irishcuvoice.com/p/regulator-v-politician.html) at the TD you refer to

Monty

[Captain Con O'Sullivan]

Thanks Monty thats a nice link to an interesting site ... I well recall the Credit Union Registrar sitting before an Oireachtas Committee last May I think it was and making soothing noises about the level of capital reserves the credit unions had. There was a nice mixing of averages and later some moo-ing about an easing of requirements from 10% down to 7.5% reserves which then meant 'most' of the credit unions met the requirements.

It was a horrible fudge in my opinion and in fairness the Oireachtas Committee seemed uneasy. About 3 months later it was eased into the public environment that the CU system might need to be bailed out.

The Registrar needs to have his nads nailed to the wall in my opinion for his evidence to the Oireachtas Committee which was, in my view, highly evasive.

The Garda Credit Union appears to be little short of a disgrace with breaches of CU regulatory priniciples all over the shop including commercial mortgage lending to one officer of 800,000 to help buy a pub I believe.

Sherlock is just pulling the Ned O'Keeffe nonsense and hoping to tap into the dumb peasant regulatory system of saying 'go away furriner'. Its hopeless bognonsense from both O'Keeffe on Elderfield and from Sherlock.

[monty cardigan]

@ cpt con - please do tell others about the site (http://www.irishcuvoice.com/)

The regulator has been aware of significant breaches of the law ever since 2003 when many credit unions were lending in excess of legal limits.

Despite having the powers to act including taking legal action in the courts nothing was done. Breach of the lending limits is a serious offence punishable on indictment with prison sentences and fines.

Many of the directors and managers (http://www.irishcuvoice.com/p/story-board.html)who were responsible for blatant non-compliance continue to govern and manage credit unions.

Monty (http://www.irishcuvoice.com/)

[Captain Con O'Sullivan]

Will do Monty ... its such a bloody opportunity missed where credit union systems could have taken on retail bank depositors and we could have shut down AIB ... I do like the CU system and think its worth keeping healthy as its local for people and should be a cracking service.

Bloody awful that the system has been abused. But its a system worth regulating properly and keeping straight in my opinion. Older people like CU's and they should be as steady as a rock.

Here are a couple of threads covering CU issues over the last year or two you might not have seen ...

http://www.politicalworld.org/showthread.php?t=2094

http://www.politicalworld.org/showthread.php?t=2476

http://www.politicalworld.org/archive/index.php/t-5580.html

[C. Flower]

The review might have been welcomed, but perhaps the results won't be.

A credit union employee told me recently that bad debt had gone from 1 million to 8 million in the last year in their small organisation.

http://businessetc.thejournal.ie/credit-unions-could-be-next-to-receive-taxpayer-funding-155796-Jun2011/?utm_source=shortlink

[TotalMayhem]

CBoI and Ernst & Young have taken over Newbridge Credit Union (http://www.rte.ie/news/2012/0113/creditunion.html). But there's nothing to worry, it'll be business as usual, lads.

[DCon]

Is the Garda credit union next?

[Baron von Biffo]

Is the Garda credit union next?

Is it in trouble?

[Kid Ryder]

Is it in trouble?

Both of them are. I remember reading the Phoenix several years back: it stated that the Garda credit unions were in serious trouble because of a culture of lax oversight, corruption and ultra-loose lending practices, as well as many Gardaí turning out to be extremely delinquent debtors indeed. I'll have a look through my back issues and see if I can root it out.

[PaddyJoe]

Is it in trouble?
Have a look at the Indo article here from Jan 2010

Sunday January 10 2010
The garda credit union, St Raphael's in Dublin, has been hit by a double whammy since the holiday period, with the near collapse of its new headquarters in the west of the city and a storm over toxic loans.

http://www.independent.ie/national-news/toxic-loans-tarnish-the-garda-credit-union-books-2007218.html

[C. Flower]

Is it in trouble?

Heavy duty property lending, reportedly.

But Anglo, it ain't.

[Baron von Biffo]

Have a look at the Indo article here from Jan 2010

http://www.independent.ie/national-news/toxic-loans-tarnish-the-garda-credit-union-books-2007218.html

Thanks for the link PaddyJoe.

As an institution dealing almost exclusively with public servants the garda CU is in a weaker position than CUs in the community generally because almost all of it's members have suffered multiple cuts in their income.

[PaddyJoe]

Thanks for the link PaddyJoe.

As an institution dealing almost exclusively with public servants the garda CU is in a weaker position than CUs in the community generally because almost all of it's members have suffered multiple cuts in their income.
I'd imagine as well that the situation is significantly worse now that it was two years ago.

[Baron von Biffo]

I'd imagine as well that the situation is significantly worse now that it was two years ago.

No doubt you're correct about that. There may be a small respite now if some of the hundreds forced out by the dismantling of the pension scheme opt to pay off debts from their lump sum.

Offset against that will be the problems thrown up by re-location of guards from rural/village to urban/city areas as smaller stations are closed.

[Captain Con O'Sullivan]

I suppose they'll require relocation expenses. As opposed to 'you've been posted. If you don't like it, resign.'

[DCon]

up to 6 Credit Unions will be taken over by the Central Bank says the Indo

http://www.independent.ie/national-news/central-bank-will-take-over-more-credit-unions-2990195.html

[Captain Con O'Sullivan]

Thanks for the link PaddyJoe.

As an institution dealing almost exclusively with public servants the garda CU is in a weaker position than CUs in the community generally because almost all of it's members have suffered multiple cuts in their income.

Ha ha ha Biffo you are a card. The Garda Credit Union is in trouble because it was in breach of the regulations around credit unions lending for commercial purposes- one Garda is known to have borrowed 800,000 euros to buy a pub.

You are such a typical Fianna Fail chancer- full of horseshyte and I am sure you are well aware of the abuses around the Garda Credit Union.

[Captain Con O'Sullivan]

up to 6 Credit Unions will be taken over by the Central Bank says the Indo

http://www.independent.ie/national-news/central-bank-will-take-over-more-credit-unions-2990195.html

Anyone recall the Registrar of Credit Unions sitting in front of an Oireachtas Committee fudging like mad on the question of whether Credit Unions were in compliance with reserve requirements?

If I remember correctly it went something like this...

Oireachtas Committee: 'Registrar would you say that Credit Unions are in compliance with the 10% reserve rule against funds lent out?'

Registrar: 'Most of them would be in compliance with a 7.5% reserve rule if a 7.5% rule existed, yes..."

Oireachtas Committee: 'Um...'

Registrar: 'Must dash. I have a very important meeting with somebody.'

Oireachtas: 'Kay'. Bye. Do you want to borrow our umbrella?'

That was pretty much it. The registrar totally bullshitted the Committee in May of last year and the Committee were absolutely aware of it from any reading of the Committee proceedings. More vague interviews by the kindly old duffer Headmaster that is the Oireachtas- aware that the parents pay the school fees after all....

[Baron von Biffo]

up to 6 Credit Unions will be taken over by the Central Bank says the Indo

http://www.independent.ie/national-news/central-bank-will-take-over-more-credit-unions-2990195.html

Might be cheaper for us to just take on the bad debts than to pay the private sector rates to manage them.

[DCon]

Good old Lenihan took steps to "safeguard the CU sector" back in 2010.

Lucky for us he did.





Written answers
Tuesday, 22 June 2010

Brian Lenihan Jnr (Minister, Department of Finance; Dublin West, Fianna Fail)

Section 35 of the Credit Union Act 1997 imposes limits on credit unions in relation to longer-term lending. The restrictions contained in Section 35 are an important asset and liability instrument which has protected the financial stability of the credit union movement over many years. The funding of credit unions is predominantly provided on a short-term basis in the form of on-demand savings and consequently the Section 35 limits are necessary for the protection of the financial stability of credit unions.

The effect of the amendment contained in the Central Bank Reform Bill 2010 is to increase from 20% to 30% the limit on the proportion of a credit union loan book comprising loans over 5 years. Credit unions have been seeking the amendment for some time. It represents, however, a significant weakening of this asset and liability tool in order to enable an increased capacity for credit unions to reschedule loans. For this reason, it is accompanied by some balancing measures which will allow for a framework for implementation by the Registrar of Credit Unions including requirements in relation to liquidity, provisioning and accounting transparency.

As I indicated during the Committee Stage debate on the Bill in Dáil Éireann last week, these requirements are to be implemented under the framework in a prudent, balanced and proportionate manner, in line with reasonable conditions and generous transitional arrangements. Following meetings with a number of Deputies and with the credit union representative bodies, I have reflected on concerns expressed to me and I will be bringing forward amendments to the relevant provisions in the Bill at Report Stage. The changes represent a reasonable compromise but they are as far as I can go.

There is a balance to be struck between meeting members’ needs to reschedule loans and ensuring the stability of the credit union sector overall. We must act now in a prudent and preventative manner. It is in the interests of every credit union in the country that the stability of the sector is safeguarded. The proposals being brought forward in connection with the Bill will achieve this fundamental aim and I would not be happy to defer the amendments to Section 35.

http://www.kildarestreet.com/wrans/?id=2010-06-22.839.0&s=credit+union+registrar#g841.0.r

[Captain Con O'Sullivan]

Might be cheaper for us to just take on the bad debts than to pay the private sector rates to manage them.

Easier to cover up evidence of mismanagement as well as breaching of Credit Union rules.

[DCon]

Brave BIFFO had a Review Group set up to advise on an increase in the lending terms of Credit Unions (got to fuel that boom!)



Tuesday, 3 April 2007

Brian Cowen (Minister, Department of Finance; Laois-Offaly, Fianna Fail)

The Report of the Review Group on Longer-Term Lending Limits under Section 35 of the Credit Union Act, 1997, was published on my Department’s website on 2 February 2007. The Review Group was comprised of representatives from the Irish League of Credit Unions, the Credit Union Development Association, the Registrar of Credit Unions and my Department.

The Report recommended that Section 35 lending limits should be increased for loans over five years from 20% to 40% and over ten years from 10% to 15%, for those credit unions approved by the Registrar as having the necessary controls and safeguards in place and which satisfy financial criteria in relation to arrears and reserves.

I consider that the recommendations in the Report strike an appropriate balance between the development needs of credit unions and the protection of members’ savings and have undertaken to introduce the necessary Regulatory amendments in the coming months.

It should be noted that the focus of the review was on longer-term lending in general and not on any specific product type such as mortgages. I understand however, that a number of credit unions have been approved by the Registrar of Credit Unions to provide a mortgage referral service to their members, as a result of partnership arrangements they have entered into with specific banks/building societies.

http://www.kildarestreet.com/wrans/?id=2007-04-03.1753.0&s=credit+union+registrar#g1755.0.r




Brian Cowen (Minister, Department of Finance; Laois-Offaly, Fianna Fail)

Thursday, 29 June 2006

Under Section 35 of the Credit Union Act, 1997 loan terms over 5 and 10 years are limited to 20% and 10% respectively of each credit union’s loan portfolio overall. These limits may be changed by Ministerial Order under the Act. The Irish League of Credit Unions (ILCU) has highlighted the current restrictions on longer-term lending as an important concern for the credit union movement and is advocating an increase in the lending limits. The Registrar of Credit Unions who is responsible for the regulation of credit unions under the Act does not favour a change in the lending limits at this time. In view of the divergence of views, I have referred this matter to the Credit Union advisory Committee (CUAC), the statutory advisory body on credit union matters under the Credit Union Act, requesting the Committee’s advice on whether a review of the current limits on longer-term lending should be carried out. The recommendation of the advisory Committee is expected shortly.

http://www.kildarestreet.com/wrans/?id=2006-06-29.1100.0&s=credit+union+registrar#g1103.0.r

[Captain Con O'Sullivan]

Get this- Ernst and Young are overseeing the credit unions taken in by the Central Bank. Ernst & Young are involved in both the Lehmans collapse where they neglected to inform investors of certain transactions within the group and they are also auditors to Olympus in an ongoing fraud in the Asian market.

Both items being embarrassingly large- too large to have gone unnoticed by the auditors:)

[DCon]

Prime Time covering shortly

[TotalMayhem]

Worry not, lads, the IMF will pay for your savings :D

They call him Leo the Loon for a reason.

[C. Flower]

Credit Unions organisation is claiming that the new Credit Unions Bill is anti-democractic as it bars volunteers from Credit Union Boards.

http://businessetc.thejournal.ie/credit-union-bill-615576-Sep2012/?utm_source=shortlink

I agree with them. Credit Unions are user organisations that have attempted to provide an alternative to the big banks to small borrowers, and to encourage saving by small savers.

As such, they have the potential to offer an alternative to the Banks. I guess that is not something that the Government or Troika want us to have.

[homer]

Credit Unions have been a social success since first one started here by late Norah Herlihy and others in 1958. Ironically at the time, it was extremely difficult to get a bank loan.

After going thru many circles, we are back at that situation again.

Raising the requirements for directors will make it difficult to maintain and renew boards especialy in smaller centres.

CUs should not over-reach themselves by seeking to take over from banks,