Press release
Minister for Finance Paschal Donohoe TD published the Credit Union Restructuring Board (Dissolution) Bill 2019
Published on
Last updated on
Published on
Last updated on
The Minister for Finance, Mr Paschal Donohoe TD, has published the Credit Union Restructuring Board Dissolution Bill 2019 . The Bill gives effect to the dissolution of the Credit Union Restructuring Board.
The Bill provides for:
• The dissolution of the Credit Union Restructuring Board;
• Transfer of certain functions of the Credit Union Restructuring Board to the Minister for Finance; and
• Amends the Credit Union and Co-operation with Overseas Regulators Act 2012.
The Minister stated:
“The publication of the Credit Union Restructuring Board (Dissolution) Bill 2019 gives effect to the dissolution of the Credit Union Restructuring Board (ReBo). Following a recommendation from the Commission on Credit Unions, ReBo was established under the Credit Union and Co-operation with Overseas Regulator Act 2012, to facilitate and oversee the restructuring of credit unions on a voluntary, incentivised and time-bound basis. In its short lifetime, ReBo has overseen and facilitated 82 restructuring projects involving 156 credit unions with assets totalling circa €6bn, across 24 counties, thereby contributing to the financial stability and long term sustainability of the sector as a whole. While €250m of Exchequer Funding was provided to facilitate ReBo’s restructuring work, costs to the exchequer only amounted to circa €11.6 million, with the credit union movement providing much of the funding from its own resources, thus minimising the requirement for Exchequer funding.”
The 2012 Act provided that when the Minister was satisfied that ReBo has completed the performance of its functions under Part 3 of the 2012 Act, the Minister may dissolve ReBo. Taking account of each aspect of ReBo’s functions and following due consideration, examination and a detailed analysis of its work, the final review of ReBo concluded that ReBo has completed the performance of its functions to the highest standards and the orderly wind down of ReBo’s operations was recommended. As a result ReBo ceased restructuring at 31 March 2017 and ceased operations from 31 July 2017.
The final report demonstrates that ReBo has worked methodically and diligently throughout its time-bound lifetime to maximise its potential in facilitating and overseeing restructuring of the credit union sector in Ireland.
Notes for Editors:
The Bill provides for the dissolution of ReBo with the transfer of all its assets and liabilities over to the Minister for Finance together usual ancillary provisions.
Main points of the Credit Union Restructuring Board (Dissolution) Bill 2018
• Sets out the short title of the Bill and provides for its commencement.
• Provides for the dissolution of ReBo with the transfer of all its assets and liabilities over to the Minister together with usual ancillary provisions, provides that records held by ReBo on dissolution day will transfer to the Minister and that the Minister shall arrange for final accounts to be prepared no later than one year after dissolution day.
• Amends the 2012 Act so as to keep Relevant Provisions in effect as regards making recommendations for the use of the Stabilisation Fund within the Credit Union Fund, which will now be performed by the Central Bank.
• Provides for consequential amendments to the Central Bank act 1942 and the Freedom of Information Act 2014.
Background
The Commission on Credit Unions recommended that a body be established on a time-bound basis to engage with credit unions on the ground and to facilitate the restructuring process. ReBo was established on a statutory basis on 1 January 2013 pursuant to section 42 of the 2012 Act as the body responsible for facilitating and overseeing the restructuring of credit unions to support their financial stability and long term sustainability. The Commission recommended that restructuring be carried on a voluntary, incentivised and time-bound basis. In line with the Commission recommendation, the restructuring process has been carried out within a clear timeframe. It has been widely flagged to the sector that ReBo was established on a temporary basis and would be wound down when the Minister was satisfied that its work was completed.
In its short lifetime, ReBo has overseen and facilitated 82 restructuring projects involving 156 credit unions with assets totalling circa €6bn, across 24 counties. Additionally, it completed its restructuring work with minimum call on Exchequer resources. In 2012 €250 million of Exchequer Funds was provided in order to facilitate ReBo’s restructuring work. However only c. €11.6 million of Exchequer funding was required.
In accordance with section 43(2) of the 2012 Act, a final review of the operation of Part 3 of the Act was carried out in June 2017. Following an in-depth examination by Department officials, this review concluded that ReBo has completed the performance of its functions with positive results. On foot of this review, the Minister decided to proceed with the orderly wind down of ReBo. As a result ReBo ceased restructuring at 31 March 2017 and ceased operations from 31 July 2017.
A caretaker board comprising two Department of Finance officials and an existing director (the Central Bank nominated non-voting director) has been appointed in order to meet the requirements of the Act. The caretaker board must remain in place until ReBo is dissolved.
ENDS