Michael McGrath (Cork South Central, Fianna Fail)
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82. To ask the Minister for Finance if his attention has been drawn to the fact that progressive credit unions who have the necessary skills and infrastructure to issue mortgages and who have evidence of significant demand are restricted in the amount they can lend as mortgages under the new regulations to just 5% of their current member shares. [27886/16]

Michael Noonan (Limerick City, Fine Gael)
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My role as Minister for Finance is to ensure that the legal framework for credit unions is appropriate for the effective operation and supervision of credit unions.

The Registrar of Credit Unions at the Central Bank is the independent regulator for credit unions.  Within her independent regulatory discretion, the Registrar acts to support the prudential soundness of individual credit unions, to maintain sector stability and to protect the savings of credit union members.

The Credit Union Act, 1997 (the 1997 Act) and the Credit Union Act 1997 (Regulatory Requirements) Regulations 2016  (which set out services exempt from additional services requirements) (2016 Regulations) set out the services that a credit union may provide to its members. Currently credit unions may provide mortgages to members subject to the maturity limits contained in the 2016 Regulations which sets out the percentage of a credit union s loan book that can be outstanding for periods exceeding both five years and ten years, as well as limits on the maximum outstanding liability to an individual member. Under the 2016 Regulations, issued at the beginning of January, credit unions continue to be allowed to lend up to 30% of their loan book over five years and up to 10% of their loan book over 10 years, subject to a maximum maturity of 25 years.  In addition, credit unions can apply to the Central Bank for an extension to their longer term lending limits (up to 40% of their loan book over 5 years and up to 15% of their loan book over 10 years). Approval of this extension is subject to conditions set by the Central Bank.  The 2016 Regulations do not provide for a specific limit of 5% of current member shares.

The Government recognises the important role of credit unions as a volunteer co-operative movement in this country. The Government's priorities remain the protection of members' savings, the financial stability of credit unions and the sector overall and it is determined to support a strengthened and growing credit union movement into the future.