EU gives green light for Government plans to drive widespread mergers of credit unions
THE European Commission has approved Government plans to encourage mass mergers among credit unions.
The move is likely to see as many as 250 credit unions to merge in the next three years.
The republic’s 400-plus credit unions are operated and run separately, as they are owned by the members in their area.
But a government-appointed commission that reported in April recommended that credit unions should come together to benefit from economies of scale and so weather the financial storm.
The Government has put aside €250m and the same again next year to bail out troubled credit unions.
Now the EU Commission said it had looked at the State’s plans to bailout distressed credit unions and found it is in line with EU state aid rules.
This morning the Commission said the State’s plans for the credit union sector “represent an appropriate means of remedying a serious disturbance in the Irish economy”.