Central Bank of Ireland

This page contains links to specific Central Bank of Ireland documents in relation to Credit Unions regulated in the Republic of Ireland. The documents are available from the Banks website, and we have reproduced them here for your ease of reference.

Credit Unions and other providers of financial services will now be monitored under the PRISM risk framework in the Republic of Ireland. To review the document which explains how please follow this link Central Bank of Ireland document which explains PRISM

Credit Union Guidance Notes

Applying for Approvals for Credit Unions

Additional Services

Subject to certain provisions, a credit union may provide, as principal or agent, additional services of a description that appears to the Registrar of Credit Unions to be of mutual benefit to its members.  (Sections 48 to 52 of the Credit Union Act 1997 (as amended) (“the Act”) govern additional services)

Before a credit union can provide such services, they must apply for permission from the Registrar and must also amend their standard rules.

A credit union must comply with a number of conditions as stipulated in the appendices attached to the application forms.  (In certain circumstances, the credit union will need additional authorisation from another Central Bank of Ireland department, Financial Institutions and Funds Authorisation, such as is the case with the provision of insurance products.)

When making an application to the Registrar, the credit union must complete two application forms.  The Registrar must give a preliminary view as to whether and to what extent the provision of the service would be likely to be approved.  However this preliminary view shall not prejudice the final approval decision.

Preliminary View Application Forms;

Once a positive preliminary view has been received from the Registrar, the credit union can proceed with giving notice of the resolution for the proposed service to its members in accordance with the rules of the credit union.  Once the resolution has been passed at the AGM / SGM, the credit union may proceed with completing the formal application form.

Formal Application Forms;

Where a credit union is applying for more than one service, a separate application must be completed for each service and product provider.

The credit union must ensure that all appropriate actions have been taken in order to comply with the provisions of Sections 48 to 52 of the Act.  They must also ensure that, should additional authorisations be required, for example in the case of the provision of certain insurance products, that these authorisations have been granted.

Change of Principal Form;

Should a credit union wish to change principal in the future, they must complete a new application and submit it to the Registrar before proceeding.

Exemptions from Approval;

The Minister for Finance has enacted legislation which provides credit unions with exemptions from additional services requirements for a number of additional services subject to certain conditions. In order to provide these services, credit unions may require authorisations from the Central Bank of Ireland under other legislation such as the Investment Intermediaries Act 1995. The following Statutory Instruments have been enacted in relation to exemptions from Additional Services Requirements.

Correspondence in relation to additional services should be sent to the following address:

Additional Services Applications
Registry of Credit Unions
P.O. Box 559
Dame Street
Dublin 2

Longer Term Lending

On 4 February 2007, the Minister for Finance published the Report of the Review Group on longer-term lending limits as provided for by Section 35 of the Credit Union Act 1997 (as amended) (“the Act”).

The Report recommends that Section 35 lending limits should be increased for loans over five years from 20% to 40% and over ten years from 10% to 15%, for those credit unions approved by the Registrar of Credit Unions as having the necessary controls and safeguards in place and satisfying the following financial ratios in relation to arrears and reserves:

  • Loan Arrears are no greater than 5%;
  • Statutory Reserves over Total Assets are 6% or greater; and
  • Total Reserves over Total Assets are 8% or greater.

The Report was prepared by a Review Group appointed by the Minister with representation from the Irish League of Credit Unions, the Credit Union Development Association and the Registrar of Credit Unions.

On 29 April 2007, legislation was enacted to enable credit unions that have received written approval from the Registrar to avail of the increased lending limits.

In order to apply to the Registrar for approval to avail of the increased lending limits, credit unions must complete an application form signed off by the board which includes:

  • Auditor confirmation that the credit union satisfies certain financial ratios;
  • Commitment from the board that these financial ratios will be maintained;
  • Confirmation that an internal review has taken place and that following the internal review the board is satisfied that the credit processes, resources and operating systems in place are appropriate to the business needs of the credit union.

The Explanatory Note & Application Form includes notes on how to complete and submit the application and is available to download.

Correspondence in relation to longer term lending should be sent to the following address:

Longer Term Lending Applications
Registry of Credit Unions
P.O. Box 559
Dame Street
Dublin 2

 

 

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