Irish News

Tuesday 22 July 2014

Plan for €148m 'super' credit union hits stumbling block

Charlie Weston Personal Finance Editor

Published 08/01/2014|02:30

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Credit-Union-logo-PMS.jpg

PLANS to merge two large credit unions have hit a stumbling block after members demanded a say in the move.

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The coming together of the two Dublin lenders would create one of the largest credit unions in the country.

Hundreds of credit unions are set to merge this year but the proposed tie up between Coolock-Artane and Swords credit unions would be the biggest, with the creation of a group with assets of €148m and 44,000 members.

The two lenders have been involved in merger talks for months.

But the tie-up has been stalled after members of Coolock-Artane passed a resolution at the annual general meeting recently, telling the board to seek approval from members.

Under legislation, the board of a credit union can push through a merger with another credit union without seeking approval from the members if the Central Bank approves.

More than half of the country's credit unions are now looking at merging. If even a fraction of them go ahead with tie-ups it will amount to the biggest shake-up in the 55-year history of the movement.

Just over 200 credit unions have contacted the State's Credit Union Restructuring Board (Rebo), put in place to manage voluntary mergers; this is up from 125 at the start of the month, and this is out of a total of 392 member-owned credit unions.

Coolook-Artane Credit Union director Catherine Bannon insisted that the proposed merger was not agreed and talks were ongoing.

She said members would be fully consulted, and denied there was opposition to the tie-up.

Coolock-Artane has 28,000 members and assets of €98m. There are 16,000 members in the Swords lender, and it has assets of €46m.

Swords Credit Union manager Fiona Cunningham admitted there were other credit unions in the Swords area it could merge with, including River Valley, St Joseph's Irish Airports & Aviation, and Malahide.

CONNECTIONS

Ms Cunningham acknowledged that her husband Noel was on the board of Coolock-Artane and that she was a former board member of Coolock-Artane.

But she insisted that was irrelevant and the proposed merger made sense as both were compatible in terms of payments systems and governance.

And Ms Bannon said: "Family connections are not an issue." If it goes ahead, the merged body is likely to be called Member First.

Last month, North County Dublin credit unions in Skerries, Balbriggan and Donabate formalised a tie-up to create Progressive Credit, which will have assets of €70m and be able to offer electronic payments.

The boards of Baltinglass in Co Wicklow and Castledermot, Co Kildare, have passed a resolution to merge.

And three South Dublin credit unions are to come together to create a bigger lender.

The tie-up of Dalkey, with Sallynoggin/Glenageary, along with Shankill, Ballybrack and District will create a new body with assets of €69m.

The three community lenders are engaged in a due diligence process, and intend to complete a merger by the end of March next year.

Irish Independent

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