Dáil Éireann - Volume 638 - 26 September, 2007
Written Answers. - Financial Services Regulation.
Deputy Niall Collins Deputy Niall Collins
Deputy Niall Collins asked the Tánaiste and Minister for Finance the level of protection or guarantee afforded to credit union savings in comparison to savings in other financial institutions and banks here. [20953/07]
Deputy Brian Cowen Deputy Brian Cowen
Deputy Brian Cowen:The Irish League of Credit Unions, (ILCU), has since 1989, operated a savings protection scheme, (SPS), for credit unions. The SPS aims to protect the individual savings of members by ensuring that credit unions are financially and administratively sound and provides for savings protection for each individual credit union member up to a maximum of €12,700. It is important to note that no member of a credit union has experienced any loss of shares and deposits and no credit union has become insolvent. The SPS has only been called upon in a very limited number of cases, and it has never been necessary to make savings protection payments to individual credit union members.
The design and operation of the SPS for credit unions is consistent with the specific regulatory approach adopted for credit unions under the Credit Union Act 1997. However in line with changes in the regulatory environment for finan cial services generally, the need for modernisation of the organisational structure and governance arrangements for the credit union SPS has become evident over time.
Earlier this year the Registrar of Credit Unions commenced a structured series of meetings with the ILCU to examine certain SPS reform proposals put forward by them. The Registrar of Credit Unions has advised that these discussions identified common ground with regard to how savings protection based on the ILCU’s proposal should work. I understand that, since the conclusion of these discussions at the end of March, ILCU have been consulting with their membership and it is expected that they will revert to the Financial Regulator shortly.
The Deposit Guarantee Scheme applicable to Irish licensed banks and building societies provides for payments, up to a maximum of 90% of the aggregate deposits held by that depositor, subject to a maximum compensation payment of €20,000, in circumstances where a bank or building society is unable to repay deposits due to its financial condition.
Dáil Éireann 638 Written Answers. Financial Services Regulation.