Kieran O'Donnell (Fine Gael)
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I welcome our guests. For as long as I have been involved at national level there has been discussion on expanding the role of the credit unions. We had Ed Sibley from the Central Bank and members of his staff and Mr. Patrick Casey, the regulator of the credit unions, before the committee. Effectively, they told us that as far as they were concerned, there was no issue in terms of the capacity of the credit union movement to lend to both the SME sector and the home loan sector. Mr. Molan referred to a point they made, which is that there is a capacity to lend up to 50% of the credit union regulatory reserve, which is just short of €1 billion. Currently, 90%, or €900 million, of that is being lent. They believe there is also capacity in terms of lending to the home loan sector.

We are very supportive of public banking and the credit union movement expanding into that role. We need to get down to the hard facts. Does the credit union movement have the capacity to increase lending to the SME and home loan sectors? Are there any regulatory issues that prevent that? The Central Bank has said that the credit unions have the capacity to lend up to 50% of the credit union regulatory reserve, which Mr. Molan said is equivalent to 5% of the overall assets. Is there something else involved, and Mr. Farrell touched on it, which makes the regulatory capacity that the Central Bank has indicated unworkable for the credit unions in terms of meeting those targets? There is no point in reinventing the wheel if the wheel is a small bit rusty and needs a new tyre.

I want to get down to the issue of the capacity of the credit union movement within the existing rules to lend to the SME and home loan sectors. How does that marry with what we have been told by Mr. Ed Sibley, deputy governor of the Central Bank, and Mr. Patrick Casey, the regulator of the credit unions?