The Department of Finance today published the implementation plan for all outstanding sections of the Credit Union and Co-operation with Overseas Regulators Act 2012. The Act, which was signed into law last December, provides for major reforms in the credit union sector, including allowing a process of amalgamations and transfers to be undertaken on a voluntary, incentivised and time-bound basis and overseen by the Restructuring Board or 'ReBo'. The Act also clears the way for €250 million to be contributed by the Government to the Credit Union Fund created under the legislation. This funding is to be used to support the restructuring process and underpin the stability of the credit union sector.
While implementation of a number of sections has already commenced, mainly in relation to restructuring and stabilisation, the Minister for Finance Michael Noonan today released the following the commencement dates for outstanding sections of the Act.
August 1st, 2013 - commencement of various standalone sections, including the measures allowing credit unions the right to appeal certain decisions of the Central Bank to IFSAT, administrative sanctions, and the disapplication of certain banking legislation to credit unions.
October 1st, 2013 - commencement of sections mainly in relation to new governance and prudential requirements for credit unions. These include sections 15 to 27 which relate to the roles and responsibilities of those in key positions in credit unions including the board of directors, chair, manager, board committees, credit officer and credit control officer and board oversight committee. These also include requirements relating to risk management, compliance and internal audit.
March 3rd, 2014 - commencement of parts of sections 15, 24 and 27 which were not commenced in October 2013 and include reduction in board numbers from 15 to 11, the submission by a credit union of an annual compliance statement to the bank and procedural provisions of the board oversight committee. Commencing these measures in March 2014 will allow sufficient time for credit unions to implement these measures.
Q2 2014 - commencement of other prudential measures will begin in Q2 2014, allowing for meaningful consultation between the Central Bank and credit unions prior to implementation. These measures will amend existing provisions in relation to savings, borrowing, lending, investments, reserves and liquidity
Also today, the Central Bank published a handbook which will assist credit unions by bringing a number of legal and regulatory requirements and guidance that apply to credit unions together in one place.
