Appointment of liquidators to Drumcondra Credit Union confirmed

A number of steps had been taken so far in the liquidation, including attending at the premises, closing its existing bank account, and opening a new liquidation account

Around 95% of credit union members had received payments in relation to their deposits under the Government's Deposit Guarantee Scheme which guarantees deposits of up to €100,000.

The president of the High Court has confirmed the appointment of liquidators to Drumcondra and District Credit Union in Dublin.

Ms Justice Mary Irvine granted orders sought by the Central Bank confirming the appointment of Stephen Tennant and Nicholas O’Dwyer of Grant Thornton who had been appointed joint provisional liquidators by the court earlier this month.

The court heard today that there was no appearance on behalf of any of the credit union's creditors. One of its directors, Rory Flynn, said he was present in court as an observer.

Brian Kennedy, for the Central Bank, said there had been a co-operative approach to the liquidation by the directors. 

Around 95% of members had received payments in relation to their deposits under the Government's Deposit Guarantee Scheme which guarantees deposits of up to €100,000.

Further information is sought in relation to the other 5% as it involves members who may be deceased or have moved home, counsel said.

The court heard, in an affidavit from one of the joint provisional liquidators, Mr O'Dwyer, a number of steps had been taken so far in the liquidation.

Niall Ó'hUiginn, for the liquidators, said these included attending at the premises, closing its existing bank account, and opening a new liquidation account.

Three employees had been engaged on a temporary basis to help with running of the credit union business as it prepared for insolvency, he said.

There was a total of just over €90,000 in cash and cheques retrieved from the premises and there was some €8.4m in investments, managed by Davy stockbrokers, €2.5m of which was readily accessible.

Steps have been taken to have its Upper Drumcondra Rd premises valued, counsel said.

Regarding its loan book, he said the liquidators were in the process of preparing an information memorandum and they hoped to have that ready by August 20.

A number of creditors including Revenue have not responded yet, he said.

If members wish to transfer their savings which are covered by the Deposit Guarantee Scheme to another credit union, the insurance benefit their deposits enjoyed will be transferred as well, providing it is done before August 20, he said.

In the application earlier this month to appoint provisional liquidators, the court heard the Central Bank was involved in extensive efforts to ensure the credit union addressed financial viability issues.

These related to the value of its Drumcondra premises. 

In 2016 it received financial support from the Irish League of Credit Unions with the aim of restoring the legally required position that it have a minimum reserve of 10% of total assets.

Last year, the credit union pursued merger options but ultimately failed to do so due to an inability to secure external funding to restore its capital position required prior to any merger.

Ms Justice Irvine said the provisions of the Central Bank and Credit Institutions (Resolution) Act 2011 had been satisfied and she made the order sought by the bank which she said was also entitled to its costs along with the liquidators.