Credit Union 'manager' to be paid €423 an hour
A 'special manager' appointed by the Central Bank to run a Co Kildare credit union will be paid €423 per hour for his work.
Luke Charleton of accountancy firm Ernst & Young will be paid the hourly rate for the next month to compile a report on trading conditions in Newbridge Credit Union on behalf of the financial regulator.
And last night it emerged that the Regulator will pay any colleagues assisting the 'special manager' a minimum of €150 per hour.
A legal notice published this morning outlines the range of hourly fees which will be paid until February 13 next, after which an agreed fee will be struck between the Central Bank and Ernst & Young for further work.
Last Friday the Central Bank took over the running of the country's third-largest credit union amid fears that it had not set aside enough money to cover potential losses from property-related loans.
Regulators insisted the savings of 37,000 members are safe.
The notice published today states that a 'special manager' will be "remunerated on the basis of the following hourly rate" of €423, while his 'assistants' will be paid €423 if a partner, €339 if a director, €279 if a senior manager, €216 if a manager and €150 if a senior.
Mr Charleton is tasked with reviewing the union's loan portfolio, and must produce an interim report within a month. He must also develop a plan to restore the union's financial position, and will be in place for six months.
The special manager will also be entitled to "reasonable costs and expenses" incurred in the course of his work. The amounts being paid are almost 50 times the national minimum wage of €8.65 per hour.
Concerned customers called to the lender over the weekend as fears rose about their savings after the regulator used new legislation for the first time to take control of the union.
Kildare South TD Martin Heydon (FG), whose offices are next door to the NCU, said a number of members had visited the credit union offices on Saturday.
"It is always busy on a Saturday morning but there was a level of concern there," he said. "It was busier than usual but it wasn't manic. I've been getting calls from members about it."
The Central Bank has assured members they can continue to do business as normal with the credit union and the NCU's offices remain open for deposit and loan facilities.
Deposits up to €100,000 are fully guaranteed by the State deposit guarantee scheme.
The regulator got a High Court order appointing the special manager to oversee the day-to-day running of the credit union.
It was the first time the Central Bank moved to use the extensive powers granted to it under the Central Bank and Credit Institutions (Resolution) Act 2011.
The High Court was informed the NCU does not have sufficient reserves to withstand expected high losses from loan defaults.
Its members have savings of €163m and it has loans of €190m, but it is understood the credit union backed a number of commercial lending deals during the property bubble that have since gone sour.
Concerns about the financial soundness of some 56 credit unions have also prompted fears that the Central Bank will soon swoop on more lenders.