The Credit Union Managers’ Association (CUMA) said it recognised the challenges that rising arrears, and failures to pay dividends over a prolonged period presented. “We also recognise that immediate regulatory resolution interventions will be necessary in a limited number of cases,” it said.
In welcoming the proposed tightening of the regulatory framework, CUMA said the changes being proposed “will strengthen member protection and ultimately strengthen the sector”.
Jimmy Johnstone, president of the Irish League of Credit Unions said: “The only way we will overcome the challenges that we face is by working together. We must all play a part in successfully implementing the commission’s recommendations.
“While many of the difficulties we now face were not of our movement’s making, we must now address the shortcomings which are highlighted in this report.”
The Central Bank’s Registrar of Credit Unions, James O’Brien, said that the report made clear recommendations on the measures that are required to assist the sector in addressing current challenges and help secure its long term viability.
“The Central Bank has been focused in recent years on delivering a more effective governance and regulatory regime for the sector. We are committed to bringing about the development of a sustainable structure for the sector underpinned by a strong statutory based regulatory framework.”
Colm O’Grady, credit union partner at Russell Brennan Keane, said the reality of the proposed changes will bring a significant burden of change and re-skilling to many credit unions relying on a volunteer ethos.
“The recommendations include extending the Central Bank’s administration sanction regime to credit Unions. Without doubt, this signals that full compliance with Central Bank regulations will be the only way forward,” he said.