A group of Irish credit unions, and two apexes for the national sector, are looking at the possibility of a centralised treasury function for the sector.
This would create a liquidity management mechanism (CLMM) for the sector, which could unlock €9.9bn in mortgage and SME lending and allow credit unions to increase their presence in these markets.
The move is based on similar systems in place for credit unions in the USA, Canada and Australia.
It is being led by five credit unions – Member First, Health Services Staff, Comhar Linn INTO, First Tech and St Raphael’s Garda –.with the Irish League of Credit Unions (ILCU) and the Credit Union Development Association.
And overall, there are 35 credit unions across the country interested in joining.
Project leaders have met with Robert Troy, minister for financial services, credit unions and insurance, to discuss the idea.
If it goes ahead, the CLMM would offer new funding structures for individual credit unions, alongside skilled services like asset and liability management.
The news comes after the Central Bank confirmed that credit unions will be allowed increase their level of mortgage lending as a percentage of their total assets (up to 30%).
A spokesperson for the group told the Irish Times: “We have made good progress on this initiative since we first met with other credit unions in August.
“There is a lot of work to be done, but the goal is to transform the lending potential of the sector in Ireland. Our objective is to design the necessary infrastructure to enhance credit union resilience and enable the sector to grow substantially as it has in other jurisdictions.”
