The Minister thanked his colleagues in the Seanad for their very constructive approach to progressing the legislation which, when enacted, will enable credit unions to collaborate more effectively and develop a wider range of products.
The Bill will:
- Support investment in collaboration through the creation of corporate credit unions, as an additional regulated vehicle through which credit unions could collaborate. The Bill will also amend Section 43 to clarify that credit unions can invest in ventures supporting credit unions.
- Improve members’ services by allowing credit unions to refer members to other credit unions and to participate in loans of other credit unions.
- The Bill will also amend Section 38 to allow the Minister for Finance to set a maximum interest rate, currently fixed at 1% per month. This will provide more flexibility for credit unions to price risk in a rising interest rate environment.
- Support enhanced governance through amendments to facilitate a greater focus on strategic planning and to redress the balance of responsibility on the board between directors and management. These provisions include:
- The option of making the manager a member of the board;
- Reduce the minimum number of board meetings to six per annum;
- Reduce the frequency of review of policies; and
- Reduce the number of administrative issues to be mandatorily approved by the board.
Minister of State with responsibility for Financial Services, Credit Unions and Insurance, Seán Fleming TD, said:
“This is a really important piece of legislation, which will help credit unions grow to meet the changing banking landscape in the country.”
“I want to thank my colleagues in the Seanad and all credit unions for their constructive approach to the legislation. It is the first meaningful reform for the credit union sector in ten years and will help them to do more for their members.”
“I look forward to engaging with Members of Dáil Éireann in finalising this legislation, which will strengthen and help the credit union sector.”
