Merger of two credit unions to create one of the largest community lenders in State
Two credit unions are set to merge to create one of the largest community lenders in the country.
St Canice’s in Kilkenny and Bagenalstown Credit Union in Carlow will have combined assets of more than €400m when the tie-up is complete.
The enlarged entity will have 64,000 members.
By asset size and membership numbers, the new body will be the largest community credit union in the State.
Members of both credit unions have now passed special resolutions for a merger.
Chairman of St Canice’s Eamonn McArdle said the tie-up would create a “stronger, more efficient credit union which can provide enhanced loan and saving facilities”.
He added: “This combination is an extremely positive move for members of our credit unions. It makes perfect sense not only from a financial and member-service perspective but also an administrative one in the current regulatory environment.”
Following the approval, a formal application has been lodged with the registrar of credit unions, based in the Central Bank.
St Canice’s has assets of €363m, with 57,000 members, according to manager Claire Lawton.
Bagenalstown has €48m in assets, and a loan book of €12m.
Ms Lawton added: “It is a well-run credit union with 13pc reserve ratio and a welcome addition to the St Canice’s family.”
The enlarged body will now be on a par with St Raphael’s Garda Credit Union which is considered to be the largest credit unions in the country. It is classified as an “industrial credit union”.
Ms Lawton said St Canice’s was one of 50 credit unions planning to launch a current account, with a debit card, later this year.
Other services to be offered to members of the merged body include agri-loans, mortgages, online banking and personal loans.
St Canice’s currently offers short-term loans under the ‘It Makes Sense’ initiative that aims to offer an alternative to moneylenders. Bagenalstown currently does not offer this loan facility.
Large numbers of credit unions have merged in the last few years. The overall number is down to 264, from around 400 a few years.
But these have mostly kept local offices open, even after mergers.
Higher compliance costs, the need to invest in IT systems, and a desire to offer more services have encouraged the mergers.