Hello and good morning all,
Further to yesterday evening’s update the Central Bank have now published the following statement. Please share this with your colleagues who are handling queries from members.
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Hello all,
We hope you are keeping well as you deal with this unprecedented challenge for everyone. We fully appreciate how difficult it is for you and your teams as you try to support concerned members. CUDA will continue to keep you updated and provide you with as much practical supports as we can. We have a good up-take with regard to the new web form and now have non owner member credit unions requesting access to it.
Credit unions are here to support the Irish people in these unprecedented times – that is the message from Ireland’s most trusted financial services brand. Ireland’s Credit Unions have in excess of 3 million members, and are the sole provider of credit for many of these members and account for approximately 34% of the consumer lending market.
Further to our email last Friday, the situation continues to develop rapidly and we are in unchartered territory. We do not know how long crisis measures will have to be in place and it is difficult to quantify the full financial impact these measures will have on credit union Members, the economy and indeed credit unions themselves. We are aware that you have received many calls from concerned members about their sudden loss of income and how they may be unable to meet some or all of their loan commitments.
CUDA, and our Member Credit Unions, are following the COVID-19 developments very closely. We continue to monitor the latest advice from the Government and from the HSE, and want you to know that we have plans in place to ensure members continue to be able to access the services they need.
Hello all,
Thank you for the many queries received as we all monitor carefully the impact of the COVID-19 virus, and it’s potential impact on the credit union business.
It is commendable the important and unprecedented measures that you are implementing to assist with the protection of members, staff and general public health. It is essential to keep testing the elements of your business continuity plan.
Survey – 3 out of 4 (77%) Consumers believe Credit Unions should compete more aggressively with Banks
- Some credit unions poised to double or triple loan book size as a result of rule changes to longer-term loans
- Credit unions disappointed at limited permission to become a key business loan provider and to support Government Housing Schemes
CUDA believes that the new rules which aligns the volume of loans a credit union can issue to their asset size is fundamental, and could enable many credit unions to double or treble their lending in certain loan classes.
Credit unions can and should ‘take on the banks’, according to more than 70% of Irish adults in a recent survey, commissioned by CUDA and conducted by iReach. The majority (74%) of adults believe that credit unions could make a bigger impact and should collaborate to compete with the banks.
Kevin Johnson, CEO of the Credit Union Development Association (CUDA), commenting on the new rules issued by the Central Bank of Ireland today, said “Up until now the level of loans the credit union should give out was based on the percentage of loans already issued. This was holding credit unions back from providing more loans to support their members and their communities. Now the volume of loans will be based on a percentage of assets of the credit union. With an average of just 28% of assets currently lent out, the Regulations will allow many credit unions to do more loans for more people.
CUDA has persistently lobbied for these changes since 2015 and are delighted that these changes will bring much needed competition to the market for mortgages, home renovations and business loans”.
“We look forward to providing the wider range and higher volume of loans now permitted under the new rules and welcome the Regulator’s commitment to re-evaluating these limits as the sector evolves in these areas of lending. In particular CUDA believes credit unions are ready and willing to help do more in filling the void for business loans left by the banks”.
Kevin Johnson went on to express disappointment that credit unions will be prohibited from supporting aspects of Government Housing Policy such as the Repair and Leasing Scheme. There is no logic, he said, to prohibiting credit unions from providing much needed loans to their members who want to help rebuild Ireland through the Repair and Leasing Scheme. Kevin further expressed disappointment with the limit on the number of business loans a credit union can do in a time when many credit union members who are small businesses are crying out for funding.
CUDA is committed to getting solutions to these issues and will speak directly with the Department of Finance, Department of Housing and the CBI on these matters.
Kevin concluded, “It’s very encouraging to find that 59% of people aged between 18-34 either agreed or strongly agreed with the perception of credit unions being ‘dynamic and innovative’. We have made huge effort and investment in recent years to develop our work in line with advances in technology through our innovation hub, the Solution Centre. In the past three years we have introduced new lending products and these new limit rules from the Central Bank will allow us help credit unions further develop. Our Digital Marketing adverts reached 2.74m people so far in 2019, creating over 18,000 loan leads with a value of €102m. We are committed to broadening the appeal and relevance of the credit union movement among younger generations, and to making our services as accessible as possible, to as many members as we can, both old and new.”
-ENDS
CUDA are hosting a full day Compliance Training event including AML/CTF, Ethics & Data Protection on Thursday 31st October in Maldron Hotel Newlands Cross. Registration will be at 9.00am. If you have not met your annual mandatory training requirements to date, this is an opportunity for CU personnel to do so. This one-day event is open to all credit union personnel, directors, BOC, Management & Staff and we welcome your attendance.
The training will be provided by Motherway Consulting, – Presenters Bernie Rogers & Donal Motherway
A brief outline of the training is as follows:
AML/CFT for Credit Unions — 9.30am – 11.30am – Bernie Rogers
AML/CTF – Guidelines for the Financial Sector – September 2019- Central Bank expectations
Risk Based Approach
Nature and process of ML and TF; crimes, penalties, detection rates
Requirements under the CJAs and 4th MLD
Deter, detect and disrupt; key responsibilities of board, staff, MLRO
Risk assessment and policy response; AML/CFT controls
Suspicion and reporting; examples of suspicious activity
Q and A
Ethics for Credit Unions — 11.45 – 12.45 – Bernie Rogers
Co-operative ethics versus other approaches, including the “ologies”
Standards and conduct
Ethics+ and a VERY ethical decision-making framework
Discussion and cases
Data Protection for Credit Unions — 13.30 – 15.30 – Donal Motherway
Requirements under Data Protection Acts / GDPR
Setting policy and procedure
Practicalities of implementation and compliance
Specific issues arising from GDPR
What to do in the event of a Personal Data Breach
Q and A
CUDA ask that you register your attendees at your very earliest convenience to roisin.smith@cuda.ie.
5 Hours CPD are accredited from LIA/IOB/ILCU or this 1-day event
CUDA are hosting a Half Day Loan Underwriting Level 4, Introduction to Small Business Lending on Wednesday 13th November at Clayton Hotel, Fonthill Road, Liffey Valley, Dublin, D22 X4W6. Registration will take place at 9.00am.
This half day Introduction to Small Business Lending will primarily target Credit Unions who are currently providing or intend to provide Small Business Loans to members. The training will be provided by Noel McArdle, Credit Knowledge Limited.
The material content for this training programme will include the following:
Loan Underwriting Level 4: Introduction to Small Business Lending
- Understanding specific issues that arise when lending to the self-employed members
- Understanding sole trader, partnership and limited company trading structures
- Understanding the different types of trading accounts that will come in from self-employed members
- Understanding how to deal with business plans and projections
- Practical sole trader case study practice techniques to:
- Understand the profit and loss account and what it tells the lender. Use four key profit ratios
- Understand the balance sheet and what it tells the lender and work the gearing ratio
- Change profit into cash and check the business has cash to meet is commitments
- Check ability to repay for loans to the business and/or to the member for personal purposes
- Understand the implications of taxation for the sole trader
- Review key underwriting checks
3 CPD Hours are accredited from LIA & IOB for this programme.
Tea/Coffee will be provided on arrival and lunch will also be provided.
We would greatly appreciate if you could let us know at your earliest convenience, who from your CU would like to attend to roisin.smith@cuda.ie as soon as possible. We very much look forward to hearing from you.
CUDA is delighted to announce as part of our Leadership Masterclass series this evening event “Succession Planning for Credit Unions”, which will take place from 6pm on Wednesday 6th November 2019 at the Clayton Hotel in Liffey Valley (https://www.claytonhotelliffeyvalley.com/contact-us/).
Credit unions are obliged to have a detailed succession plan for the board and management team to ensure that the credit union maintains an appropriate level and mix of skills and competencies at non-executive and executive level in order to support the credit union’s strategic goals. This purpose of this training event is to provide guidance and support to Credit Unions in meeting their obligations in relation to succession planning – both in terms of the Board, committees and more broadly at an executive level.
It should be noted that the Central Bank of Ireland have identified succession planning weakness as a common governance risk emerging in credit unions [PRISM Supervisory Commentary 2019] and in this regard we would propose that this event is attended by members of the Board, including members of the Nomination Committee, members of the Board Oversight Committees and executive personnel proving the Board and/or Nomination Committee with support in this area. We are delighted that Laura Powney & Frank Scott Lennon from HR For Better Workplaces will be presenting at this event and sharing their years of experience in this area.
This event will focus on the legal and regulatory requirements for succession planning for Boards and Committees and how to meet those requirements, in particular:
- Recruiting in line with your Credit Union’s Strategic Plan
- Identifying skill strengths and weaknesses on Board and committees
- Identifying volunteer competencies
- Screening applications against desired competencies
- Putting arrangements in place to avoid over-reliance on any one individual
- Providing mechanisms for delegation of responsibility, including revolving roles where appropriate
And on a boarder level, we will look at supplemental requirements when considering succession planning at senior management level.
Registration, with tea, coffee & sandwiches, will take place from 5.30pm for a 6pm start, to end around 8.30pm. If you would like to register any attendees for this event, please email their details to dawn.kennedy@cuda.ie.