Mr. Philip Hosford:

With regard to investments, we are quite happy overall with the content, and we do not see any issue in terms of restricting different classes of investments. Section 4 raised a slight red flag with a sentence indicating that the Central Bank can make regulations with respect to the distribution policy of investment income.

We have concerns in two areas in this regard. First, there are accepted accounting rules around how income is recognised and distributed. We feel we apply those and we are happy that we have consistent accounting policies which should still apply. Second, this could be used as a mechanism of the Central Bank to curtail income in credit unions. If we can only distribute income on a restricted policy, the Central Bank will have a mechanism to indicate that income can be reduced in a particular year because a credit union would not be allowed to distribute certain income if restrictions are tightened. Our fear is that if the restrictions are continually tightened, it will affect our income on an ongoing basis. There are two elements in that we are happy the accounting rules should still apply but we would not like to see a policy that is too restrictive. We would be quite happy to stick with the accounting regulations in that regard.