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New credit unions set to emerge from tie-ups

A STRING of mergers is set to create three "super" credit unions, as the pace of restructuring in the sector picks up.

It comes as regulator Anne Marie McKiernan has increased pressure on the movement to speed up the rate of tie-ups.

The income of the sector is coming under huge pressure from low demand for loans, and falling interest rates, putting pressure on for consolidation.

Mergers are a way of cutting costs.

Much of the assets of the sector are tied up in low-interest paying bank accounts and low-yield Government bonds.

There are 374 credit unions in the State with each of these individually operated and owned by its members.

Now it has emerged that more larger groupings are being created.

One of the largest credit unions, the Health Services Staffs Credit Union, has taken over three smaller ones.

It now has 31,000 members and assets of €190m, after joining forces with St Gabriel's, which was set up for postal and communications workers.

Also folded into the Health Service CU, was the CIE Staff Credit Union in Cork, and the Castle Credit Union, which was set up for Unilever Ireland employees.

Law Library, Texaco Employees and James's Street have previously been folded into Health Services.

And the Progressive Credit Union in north County Dublin is set to join forces with Victory in the Glasnevin and Ballymun area of Dublin.

Progressive is the result of the coming together of Balbriggan, Skerries and Donabate.

Last year Progressive took over Howth/Sutton following a High Court-approved transfer.

If the Victory takeover goes through, it will have a membership of 40,000 and assets of €90m.

The manager of Progressive, Sean Staunton, said: "This agreement is a further step in a series of strategic alliances between credit unions in North Dublin."

He added that the alliances are "aimed at building a robust and vibrant credit union business that will attract new members".