I propose to take Questions Nos. 18 and 32 together.
As I have previously stated, credit unions have a key role to play in providing access to credit and other important services in local communities throughout the country. The Government recognises this and has provided €500 million in funding to support the stability of credit unions through restructuring and resolution.
The Commission on Credit Unions provided its Report which makes recommendations on the strengthening of the regulatory framework of credit unions, including more effective governance and prudential requirements. These recommendations are currently being implemented in the Credit Union and Co-operation with Overseas Regulators Act 2012.
The Central Bank is continuing to work through a portfolio of approximately 100 credit unions on a case by case basis. The programme of work to engage with such credit unions is informed by the following matters: levels of arrears, inadequate bad debt provisions, high fixed asset to total asset ratio and other supervisory concerns including weak lending practices. The Central Bank's statistics, based on data submitted by credit unions as at 30 September 2013 show that some 20 of these 100 credit unions have reported regulatory reserves below the minimum requirement of 10 per cent of assets. This gives rise to a capital shortfall in the region of €11 million in total. Following engagement with these 100 credit unions the outcomes can include governance changes, risk mitigation programmes, lending and other business restrictions and/or requirements for credit unions to seek capital support.
In such cases capital support may be sought through a restructuring solution under ReBo or from resources available within the credit union sector itself.