The former board of Charleville Credit Union says the Central Bank should have proactively helped it to find a merger partner rather than opting to put it into liquidation.
In a statement, the board said: “It committed to doing same in an e-mail to the Charleville Board in August 2016.
The credit union movement would have underwritten a merger with another credit union without any cost to the State. This would have allowed credit union services to continue without any cost to the taxpayer.”
Earlier this year, it emerged that Charleville and Clonmel credit unions were in talks to merge. However, the two CUs failed to reach agreement on the fine details of a post-merger entity.
Yesterday, the former Charleville board said that, with the backing of the Irish League of Credit Unions, its credit union was able to meet the 10% regulatory reserve.
“Despite all the restrictions placed on the business by the Central Bank, the Charleville membership has remained totally loyal to the credit union business,” it said.
“They want to save and borrow more, but the Central Bank restrictions have prevented them from doing so.
"This scenario does not represent a credible outcome. If this is the outcome of a credit union’s seven-year involvement with the Central Bank, then the State urgently needs to find another structure for the regulation and oversight of credit unions.”
The Central Bank itself confirmed that, as it made yesterday’s High Court application ex parte, the credit union was not represented and had no opportunity to make its case to the court.
However, the credit union’s directors can make an application in relation to the winding-up by Monday, with the court able to reconvene on Wednesday.
The Irish League of Credit Unions (ILCU) said the decision to appoint provisional liquidators is very disappointing for the members of Charleville Credit Union “who have relied on its valued services for over 50 years”.
“The eligible savings of members of Charleville Credit Union will be covered by the Deposit Guarantee Scheme, up to €100,000 per member,” it said.
“The Board of Directors of Charleville Credit Union had, for some time, sought to bring about a transfer of Charleville Credit Union to another credit union on a voluntary basis.
"However, this was found not to be feasible. ILCU is conscious of the demand for the services of a credit union in the local area and the restoration of services is of the utmost priority.”
Local Fianna Fáil TD Michael Moynihan said Charleville is the latest in a string of credit unions to have “gone under”.
Last November the Central Bank issued €22.3m to Rush Credit Union’s 9,700 members under its deposit guarantee scheme after the union was put into liquidation. Councillor Ian Doyle, who met the 14 staff affected by the closure, has called a public meeting on Monday.
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