The reasons behind this dramatic development
Q&A by Charlie Weston
Published 11/11/2013 | 02:00
Q What is going on at Newbridge credit union?
A The Central Bank has had concerns about the running of the Kildare credit union for more than a decade.
Regulators claim there has been what they call "poor governance" at the lender.
They cite large loans given to developers.
There have also been issues around the valuation put on an elaborate office block, where the credit union is headquartered, in the books of the lender.
Central Bank executives have spoken about "persistent breaches of regulatory standards" at the Kildare credit union going back a number of years.
Q Why the dramatic developments last night?
A Why this has happened now is a good question. There has been a special manager appointed by the High Court to run Newbridge since January 2012.
Regulators had been trying to progress a solution by merging Newbridge credit union with nearby Naas.
But in the past week the board of Naas decided against the merger, fearing an unpopular link-up of the two Kildare credit unions would damage it.
When news of this leaked out, there was a fear among Central Bank regulators that they had to act fast, or face a run on the deposits of Newbridge credit union.
Q How much money is involved here?
A Newbridge credit union had savings of €163m in 2010, the last year that it published accounts.
There were loans of €140m, and investments of €53m.
It is understood to have bad debts (loans that it is unlikely to recover) of €24m.
Q Could this happen to my credit union?
A Unfortunately, yes it could in theory.
But it is unlikely, as this move is set to go down very badly among the 2.8 million members of 392 credit unions around the country. And the members of Newbridge will keep fighting the move on their institution.
Q Is my money safe in my credit union?
A Absolutely, yes. The state guarantee of up to €100,000 per savings account applies to all credit unions.