Written answers

Thursday, 19 January 2017

Department of Finance

Credit Union Regulation

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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93. To ask the Minister for Finance his views on the current regulatory environment for credit unions; the future vision he has for credit unions here; if he has considered the expansion of credit services for credit unions; and if he will make a statement on the matter. [2455/17]

Photo of Michael NoonanMichael 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.

While it is important to distinguish this division of roles, it is equally important to recognise that both the Registrar of Credit Unions and the Minister for Finance work together for the safety of members' savings and the security of the credit union sector.

Credit unions have a key role to play in providing access to credit and other important services in local communities throughout the country. In June 2016 the Credit Union Advisory Committee (CUAC) carried out a review, at my request, of the Implementation of the Recommendations set out in the Report of the Commission on Credit Unions. This significant report provides an indepth analysis of the sector.  Its recommendations are based on that analysis and on the views of a range of stakeholders, thus ensuring a balanced report providing focused and effective recommendations. CUACs recommendations are set out under seven specific headings: tiered regulation, section 35, consultation and engagement with the Central Bank, governance, restructuring, business model development and additional matters. The report also fulfils one of the key credit union objectives as outlined in the Programme for Partnership Government.

An Implementation Group, comprising representatives from a number of credit union stakeholder groups, from CUAC, from the Central Bank and headed up by a Department of Finance Official, will meet in the coming weeks to begin overseeing and monitoring implementation of those recommendations.  It is expected that implementation of those recommendations will assist credit unions in developing their business models.

The Government wants not only strong, vibrant credit unions offering a safe and secure place for members' savings but also credit unions' being appropriately positioned to offer their members a wide range of services including loans, debit card facilities and new facilities based on the needs of their membership.  

This Government recognises the important role of credit unions as a volunteer co-operative movement in Ireland and 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 continue to support a strengthened and growing credit union movement.  

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