Tuesday, 15 March 2011

2010 A TOUGH YEAR, BUT IRISH CREDIT UNIONS REMAIN CONFIDENT FOR THE FUTURE!

This month the Irish League of Credit Unions published its 2010 Annual Report. The majority of credit unions delivered an average dividend of 1.10%, with credit union membership increased by 40,000 in 2010 to 2.98 million members North and South. Over 440 credit unions delivered a surplus and member’s savings grew to €12 billion. The average loan was €8,650 and average savings per member stood at €3,900.

While we do acknowledge that there are difficult times ahead, credit unions are weathering the financial storm well and with the principle of prudence an uppermost priority; credit unions are making responsible decisions to protect their member’s interests now and into the future.
Undoubtedly, the economic downturn has had an effect on the credit union movement and 2010 has proved a challenging year for us. However, most credit unions are performing very well given the circumstances. Loan arrears are up but this is a sign of the times and this can be closely linked to increased unemployment levels and financial hardship.

When our members suffer, we suffer. We will continue to be vigilant and pro-actively manage our financial affairs in a responsible and prudent manner to protect our members in these difficult times and we will remain a vital part of local communities across the country providing excellent services and welcoming new members every day. Members savings are protected by the Government’s Deposit Guarantee up to €100,000 per depositor and the ILCU Savings Protection Scheme.

In this time of adversity, there also lies opportunity. The ability to provide a broad range of financial services, which are attractive to existing and potential members, will be crucial to the future long term development of credit unions. However, this change does not involve sacrificing our ethos and core values.

It does mean that we need to recognise that there may well be better ways to provide services to our members in the future. The fact that credit unions’ modus operandi has worked in the past does not guarantee or entitle us to success into the future.

Credit unions are different. They were established over 50 years ago to provide people with a secure place to save and access affordable credit, and this remains the case today and into the future. They are financial cooperatives, owned and controlled by their members, servicing the financial needs of their communities on a not-for-profit basis, advocating a philosophy of mutual self-help.

While we have not been immune to the turmoil in the global financial system, credit unions have fared better than many other financial institutions. The recent crisis has highlighted the strength of the credit union business model. Irish credit unions are proud of their history and remain confident for the future.


By Kieron Brennan, CEO, Irish League of Credit Unions

Friday, 4 March 2011

Protecting our most important asset

Youth officers from credit unions throughout the island met in the Sheraton Hotel Athlone last weekend (26th / 27th February) to discuss the vital role to be played by young people in the future development of the credit union movement on the island. The seminar, which was attended by 164 delegates from 103 credit unions throughout the island, focused on empowering young members to take control of their futures, both by helping them to develop sound money management techniques and by promoting and encouraging young people to become involved as volunteers within the movement”.

The rights and importance of protecting our younger members of society was the subject of the keynote speech delivered by Fergus Finlay, Chief Executive of Barnardos. Mr. Finlay spoke about the role of Barnardos in assisting over 5,000 families and children throughout the island, noting that there is still much to be done in Ireland in order to become leaders in this area.

“We’re still not got a model of how to treat children. We can be???. It will require legislation and commitment to rights and some extra resources. It will mean an investment in prevention and early intervention in the lives of children and families, where there’s a risk they won’t reach their potential.”

He went on to highlight that addressing social inclusion at an early stage is much more important and efficient that tackling the results of social exclusion at a later stage. After clearly outlining the social and societal rationale for investing in our young people, he further emphasised the point by giving an economic rationale.

“There is an unanswerable case for investing in early years’ education especially in communities that have suffered generations of disadvantage. It’s not just a case based on justice but it’s a hard-nosed economic argument. It’s the best possible way to break the cycle of poverty and to build real opportunity”.

“Every police officer appointed in a large US city costs around $80,000 a year but he or she saves $200,000 in the cost of crime – so they have to be good value for money. But look at this – for every $15,000 of direct input into education, you ultimately get the same result – a $200,000 reduction in the cost of crime. It’s cheaper and more effective to invest in young people through education that it is to train policeman in fighting crime….Why pay a policeman when education receives the same results for a fraction of the cost?”

Mr Finlay concluded by outlining the important role played by credit unions in providing a better way of life by people who find themselves in very difficult situations.

“In the work we do in Barnardos, we have a lot to be thankful to the credit union movement for over the years. There are some credit union people who volunteer to work in Barnardos, and that’s really important to us. But I couldn’t tell you the number of times in very difficult situations, families that we work with, some of them in deep trouble to money lenders have been helped and rescued by local credit union managers and staff and that applies in many, many different parts of the country. Today, for me anyway, is an opportunity to say thank you to the credit union movement and to acknowledge for people all around the country, it’s not just a source of credit, it’s not just a source of saving, it can be and has been a lifeline and a way out of really, really deep trouble towards a somewhat better life”.