The McDowell group recommended that the existing functions of the Registrar of Friendly Societies, in relation to credit unions, should be brought into the single regulatory authority – SRA – proposed by the group and that a statutory position of registrar of credit unions should be established within the SRA. Finally, the group recommended that the supervision of the credit unions by the SRA should be done in a way that would recognise and be supportive of the uniqueness of credit unions and would give comfort that their voluntary character would not be threatened by the establishment of the SRA while still addressing the appropriate regulatory and consumer protection requirements that arise.
As the Deputy may be aware, credit unions have not been regulated in the same way as banks. They have been regulated under separate legislation, viz. the Credit Union Act, 1997. The Central Bank and Financial Services Authority of Ireland Bill, 2002, provides that this will continue to be the case. The functions of the Registrar of Friendly Societies under the Credit Union Act will be carried out by a registrar of credit unions within the overall framework of the regulatory authority, but the basis of that regulation will continue to be the Credit Union Act, 1997. I have no intentions of changing this basic position. There is nothing in the Bill which requires credit unions to be treated like commercial financial institutions, such as banks.
However, I have signalled my intention to propose amendments on Committee Stage of the Bill, which would alter the reporting relationship of the registrar of credit unions, to bring the position more fully within the framework of the Irish Financial Services Regulatory Authority. The reporting relationship of the registrar would be similar to that proposed for the consumer director.