Tuesday 30 May 2017

Opposition grows to credit union merger

Members of the profitable Clonmel lender fear it will suffer financially if it has to engage in a rescue takeover of the County Cork credit union (Stock picture)
Members of the profitable Clonmel lender fear it will suffer financially if it has to engage in a rescue takeover of the County Cork credit union (Stock picture)
Charlie Weston

Charlie Weston

Plans for a mega merger of credit unions are on the brink of collapse as opposition grows to the tie-up.

Members of profitable Clonmel Credit Union in Tipperary fear their lender will be damaged by linking up with the struggling Charleville Credit Union in Cork.

Regulators and the Irish League of Credit Unions (ILCU) are encouraging the merger.

Officials from the Central Bank and the ILCU have been making regular trips to Clonmel in an attempt to shore up support for the merger.

But the plans for the rescue merger are expected to be voted down at a special general meeting next month, demanded by members of the Clonmel lender.

Charleville has been struggling for around seven years and needs a bailout of between €4m and €5m to boost its reserves as part of the takeover by Clonmel.

But if members of Clonmel vote down the merger plans it will scupper the tie-up and leave Charleville in a financially precarious position, people familiar with the situation said.

Members of the profitable Clonmel lender fear it will suffer financially if it has to engage in a rescue takeover of the County Cork credit union.

The manager of Clonmel, Paul Davey, said that no date for the special general meeting for members to discuss the merger plan had yet been finalised.

Confidential

When asked about the Central Bank and ILCU officials having attended the Clonmel board meetings, he said: "Any meetings Clonmel Credit Union Ltd has had with third parties are confidential and I regret that we will not comment on same."

Clonmel Credit Union has 27,000-plus members, he said.

He added he has received various representations in writing from some 16 individuals, and he has had three telephone calls over the past four weeks.

The Central Bank had no comment.

Irish Independent

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