'A disgrace and a disaster': Charleville Credit Union has been put into liquidation

The Central Bank said it took action to stop ‘a disorderly failure’.

By Fora Staff

THE CENTRAL BANK has put Cork’s Charleville Credit Union into liquidation due to the organisation’s perilous financial state.

The regulator applied to the High Court today to appoint David O’Connor and Jim Hamilton of BDO as joint provisional liquidators.

It said that it made the application as it formed the view that the credit union “is in breach of a number of regulatory directions and is in a distressed financial position”.

“In the absence of taking this action, it is the Central Bank’s view that there could be a disorderly failure of Charleville Credit Union,” it added.

The Central Bank said it was conscious there was a demand for the services of a credit union in the local area and it is committed to ensuring credit union services are available in the community.

Deposits in the Charleville Credit Union up to €100,000 are protected under the Deposit Guarantee Scheme. The Central Bank said payments would be issued to customer addresses on file within 20 working days.

It also stressed that today’s activity does not have any impact on members’ savings in any other credit union, while those with loans had to continue making payments in line with their agreements.

A ‘disgrace’

Speaking to C103, local councillor Ian Doyle described the news as a “disgrace and a disaster”. He said neither staff at the credit union nor the wider community had any idea it would be closed.

“A huge service in our town which has kept businesses and people and scholars and schools going is now gone and it’s a disgrace,” he said.

Local people had been campaigning to save the credit union, which had 12,000 members, but Doyle said the direction of the Central Bank appeared to be “set in stone”.

He said it is “a slap in the teeth” for the people of Charleville to have the service removed from their community.

In its statement, the Central Bank said it remains “fully supportive of the credit union sector in Ireland and is committed to the continued development of a strong and sustainable sector that meets members’ changing needs and protects their savings”.

The regulator said that its staff believed all feasible options available to the credit union to maintain its reserves at the levels required by law have been exhausted.

“The Central Bank is of the view that the inability of the credit union to address its reserve position, despite previous receipt of external funding, has resulted in it being necessary to apply for the winding up of the credit union,” it said.

Written by Michelle Hennessy and posted on TheJournal.ie