Brian Cowen (Laois-Offaly, Fianna Fail)

I move amendmentNo. 16:

In page 17, line 44, after "union," to insert the following:

"or 40 per cent of the total gross loan book balance outstanding at that time in respect of all loans made by the credit union where written approval is received from the Bank,".

Section 17 of the Bill as published amends section 35(2) of the Credit Union Act 1997 so as to allow a practical interpretation of the lending limits which apply to the making of loans. For instance, prior to this reform a five-year loan continued to be counted as such even when the repayments term outstanding had fallen below five years. The same applied to ten-year loans. This change was already implemented at the request of the credit union movement by way of SI 193 of 2007. The Attorney General has advised that the reform should be confirmed in primary legislation at the earliest opportunity and hence section 17 as published.

I also propose to avail of the opportunity afforded by Committee Stage to make a further reform in regard to the lending limits of the credit union. These two amendments to section 17 will extend the amount of long-term loans from 20% of the loan book for five-year loans to 40% for five-year loans and for ten-year loans from 10% to 15%. These further reforms could not be included in the Bill as published as a report of the review group on long-term lending limits for credit unions had not been published at that time. A further Committee Stage amendment, No. 21, will be necessary in order to formally revoke SI 193 of 2007 which will be redundant once this section is commenced.

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