Dáil Éireann Debate, Wednesday - 20 June 2012
57 Deputy Michael McGrath asked the Minister for Finance the number and extent of recapitalisations of credit unions from resources within the sector itself that have taken place to date; and if he will make a statement on the matter. [30048/12]
Amharc ar fhreagraThe Report of the Commission on Credit Unions identified 51 credit unions at 31 December 2011 with total realised reserves below 10%, of which 25 credit unions were seriously undercapitalised with reserves below 7.5%. The Report noted that, since December 2011, some credit unions have been assisted by private funds to address this position.
The Irish League of Credit Unions (ILCU) has since 1989, operated on an all-island basis a savings protection scheme (SPS) for credit unions. The SPS operates by providing financial support to credit unions that get into difficulty. As this is a privately owned and managed fund it is not possible to provide the Deputy with the information requested. The Commission on Credit Unions recommended the establishment of a statutory stabilisation mechanism whereby financial assistance could be given to credit unions on an individual basis, in certain circumstances, with certain conditions attached to the provision of such assistance. This would be facilitated by the establishment of a stabilisation fund to be managed by the Central Bank. Work on the heads of Bill to provide the statutory basis for this recommendation is currently ongoing.
58 Deputy Michael McGrath asked the Minister for Finance his view on whether the four-year timeline for the restructuring of the credit union sector as envisaged in the report of the Commission on Credit Unions report is too long; and if he will make a statement on the matter. [30049/12]
Amharc ar fhreagraThe Commission on Credit Unions presented its report to me on 18 April 2012. The Report recommended that the credit union sector be restructured on a voluntary, time-bound and incentivised basis. The Report set out a timescale for the completion of the restructuring process by the end of 2015. Restructuring is to be facilitated by the Credit Union Restructuring Board (the ReBo). Expressions of interest have already been sought for appointment to the ReBo which is due to be established on an administrative basis. This timescale is necessary as it provides for the establishment of the ReBo, engagement with credit unions, formulation of restructuring proposals and approval or otherwise of such proposals as well as allowing time for the ReBo to provide support and advice to restructured entities.
