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Newbridge Credit Union
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roy rodgers wrote: »If the merger does go ahead the credit union will be no different than any other financial institutions. Where ya won't get a loan to go on a holiday or to a extra few pound for Christmas any more because it will run on a paper base policies and not as a local base concern with interest rates of 9% plus with no dividends at the end if year.
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What do the naas share holders think about taking on new bridges bad debt??
You seem to be failing to realise that running a financial institution without proper policies and interest rates is what lead to that bad debt in the first place.0 -
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You seem to be failing to realise that running a financial institution without proper policies and interest rates is what lead to that bad debt in the first place.
the credit union has been around in newbridge for the last 45 years and was doing right well until greed took over the directors and lost the whole ethos of the union cause they were in the same job for too long..
they gambled on the Celtic tiger like Anglo and that was there down fall0 -
btw if a loan is backed by shares, a CU is entitled if there is default to transfer from the savings account to the loan account.
Some posters here do not seem to acknowledge that0 -
yeah grand but why couldn't they not restructure loans when they defaulted in the first place??btw if a loan is backed by shares, a CU is entitled if there is default to transfer from the savings account to the loan account.
Some posters here do not seem to acknowledge that
they only want to resturcture my loan now after when all the savings is gone and four years later.
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Can I just ask two questions of those in the know of Newbridge Credit Union ?
During the boom did they lend money to property developers ?
Did the credit unions charter permit them to lend money for speculation on land ?
Because if they were lending money to property developers and in doing so contravening their own lending criteria then the board have a lot to answer for. If that is the case and customers lost money because of it then the customers themselves should be taking civil legal actions against the members of the board.
To me there seems to be a lot of shouting about the Central Bank's role in this. But am getting the impression that this shouting against the big bad Central Bank is nothing more than a smokescreen to distract from the reasons as to why the Credit Union arrived at the position it is in. That is the real crux of the issue, not the winding down of it.0 -
Can I just ask two questions of those in the know of Newbridge Credit Union ?
During the boom did they lend money to property developers ?
Did the credit unions charter permit them to lend money for speculation on land ?
Because if they were lending money to property developers and in doing so contravening their own lending criteria then the board have a lot to answer for. If that is the case and customers lost money because of it then the customers themselves should be taking civil legal actions against the members of the board.
To me there seems to be a lot of shouting about the Central Bank's role in this. But am getting the impression that this shouting against the big bad Central Bank is nothing more than a smokescreen to distract from the reasons as to why the Credit Union arrived at the position it is in. That is the real crux of the issue, not the winding down of it.
totally agree with you on this one the directors have a lot to answer for.
I was speaking to some one from the town last weekend and who would be in the know as he has a business in the town for many a year and he was telling me that there is delvelopers that got money from the credit union while they weren't even members of the union.
also I believe that there is a solicitor involved that practices very close to the union. All his property are up for Sale right now.
but this is why we need the agm straight away to find out all of these speculations0 -
I think it's very much common knowledge that there were very big loans given out during the boom to local developers, including some into 7 figures...which was definitely outside their charter. The point is without an agm for nearly 2 years no one knows exactly how bad things are..especially with the gagging order.
Any word on the rumour that their showpiece in the town is being sold off??0 -
roy rodgers wrote: »totally agree with you on this one the directors have a lot to answer for.
I was speaking to some one from the town last weekend and who would be in the know as he has a business in the town for many a year and he was telling me that there is delvelopers that got money from the credit union while they weren't even members of the union.
also I believe that there is a solicitor involved that practices very close to the union. All his property are up for Sale right now.
but this is why we need the agm straight away to find out all of these speculations
Thanks, I had suspected as much and seem to remember reading something about Newbridge CU and developers a few years ago.
Sounds to me that it is an EGM that is needed rather than waiting for the next scheduled AGM. A minority of shareholders should be able to force an EGM to be held, especially if they are claiming board members were acting against their interests. The Articles of Association of the CU should outline the procedures to be followed to call an EGM and they are a public document, available from the CRO for a small fee.
Dividends aside did anyone actually lose any savings from the CU? Or did the €100k bank guarantee cover credit unions too ? Are there any pending cases against the board for negligence ?
I am not sure what the corporate structure of the CU is but if it falls under the Companies Act 1963 and is a company with limited liability (which a majority of companies are) then people who have lost money have a case to recover that money. This is because under the Companies Act 1963 a director loses the priviledge to limited liability if they are found to be contravention of the legal obligations to shareholders. These are called fiduciary duties and include the following-
-Duty to act in good faith and best interests of the company
-Duty to use powers for the proper purpose
-Duty not to fetter their discretion
-Duty to avoid all conflicts of interest
Directors also have a legal duty not to go beyond the powers given to them in the Articles of Association. So if it is the case that they were lending millions out to people who weren't even members and were lending for development purposes when the Articles did not include this facility then the directors themselves could now be personally liable for the debts incurred as a result of their actions, i.e. by breaking the law the directors lose the protection of limited liability and the personal assets of the directors themselves now become fair game for people who have suffered as a result of their actions. That means even their family home is not safe if they don't have the money to pay up. Limited liability is a great thing but as soon as you break company law then your own house and investments come into the game, stepping outside of company law is a pretty dumb thing to do and if the directors did it then people who have lost money here should be banging down their solicitors door and taking these people to the cleaners because from what I can see with the info provided so far it is a pretty open and shut case.0 -
Sounds to me that it is an EGM that is needed rather than waiting for the next scheduled AGM. A minority of shareholders should be able to force an EGM to be held, especially if they are claiming board members were acting against their interests. The Articles of Association of the CU should outline the procedures to be followed to call an EGM and they are a public document, available from the CRO for a small fee.
I am not sure what the corporate structure of the CU is but if it falls under the Companies Act 1963 and is a company with limited liability
Muahahaha,
Credit Unions are Ltd companies but fall outside the scope of the CRO. Back in the day they were under the eye of the Registrar of Friendly societies, over time this subsection as moved from the CRO to the Central Bank.
When it comes to EGM's etc, the Credit Union Acts 1997 - 2012 as amended is where you need to look too.
A lot of the new banking legislation now also applies to Credit Unions, e.g. The Credit Institutions Stabilisation Act 2010 etc. which gives the Central Bank far reaching powers.roy rodgers wrote: »What do the naas share holders think about taking on new bridges bad debt?? Have they had a meeting on this yet??
Naas Credit Union members are probably not happy as their Credit Union is being well run and understands it ethos, unlike the CU they have to go in and rescue.roy rodgers wrote: »I not paying off anymore of my loan from this week with newbridge credit union because they haven't helped me out over the last few years just took all my savings and stuck me to the wall. And when I requested where my savings is gone I get no answers as I want every thing in writing to see where its gone.
Sounds like you have not being your loan anyway. If they have taken your shares against your loan they have helped you by reducing your loan balance and reducing the amount of interest you have to pay. To use this as an excuse not to repay your neighbours money is one of the reasons why your Credit Union is in the position that it needs to be rescued in the first place.0 -
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believe me I was paying my loan and always had an on going loan for the last 17 years. It just amazes me that they couldn't restructure the loan till all the saving were gone even thou they were told about the situation over 4 years ago. But that's a different issue from the topic here. Again they lost the ethos of the credit union.0
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roy rodgers wrote: »Again they lost the ethos of the credit union.
I agree completely
I'm not a member of Newbridge but I did see their 2009 annual report. The average loan size was a frightening 17.5k.
The average cus average loan is typically 4.5 - 5.5k. The only way possible to get to a figure of 17.5k is to issue a number of 6 figure and 7 figure loans.
The reason why the directors have remained so quiet is that they have no defence.0 -
The reason why the directors have remained so quiet is that there is a gagging order in place threatening them with a 100,000 euro fine and/or 3 years in prison.
There's a lot of speculative nonsense written on this thread. The Credit Union has been a vital financial resource for the town and community groups within it for over 40 years - we shouldn't be so quick to welcome its demise. When there's no credit Union anymore we will be left to the mercies of the banks and the moneylenders.0 -
When there's no credit Union anymore we will be left to the mercies of the banks and the moneylenders.
"The Central Bank spokesman added that credit union services would remain available in Newbridge"
http://www.irishtimes.com/business/newbridge-credit-union-members-oppose-merger-and-building-sale-1.1489879
I'm guessing that there will be less 'non typical lending' from now on so maybe those in need of six and seven figure loans will indeed be driven towards moneylenders0 -
Bollox. In 2011 I needed 500 to pay 2 court fines for a van that ended up still in my name months after I sold it. 500 poxy quid or I was going to prison for 5 days. No way in hell would they give it to me cos I got a loan of 2k a few months before. I pleaded with them and told them I would lose my job and be able to pay nothing and they still said no.The reason why the directors have remained so quiet is that there is a gagging order in place threatening them with a 100,000 euro fine and/or 3 years in prison.
There's a lot of speculative nonsense written on this thread. The Credit Union has been a vital financial resource for the town and community groups within it for over 40 years - we shouldn't be so quick to welcome its demise. When there's no credit Union anymore we will be left to the mercies of the banks and the moneylenders.0 -
Bollox. In 2011 I needed 500 to pay 2 court fines for a van that ended up still in my name months after I sold it. 500 poxy quid or I was going to prison for 5 days. No way in hell would they give it to me cos I got a loan of 2k a few months before. I pleaded with them and told them I would lose my job and be able to pay nothing and they still said no.
They don't have to give you anything and obviously you weren't a candidate for a loan. I don't know how you ended up in court over a van that was still in your name but surely that was your responsibility to sort out those fines and not the credit unions.
Also the still in my name excuse doesn't wash. If you couldn't post a log book with the other persons name on it then you shouldn't be looking for loans off anyone.0 -
Eli Manning wrote: »They don't have to give you anything and obviously you weren't a candidate for a loan. I don't know how you ended up in court over a van that was still in your name but surely that was your responsibility to sort out those fines and not the credit unions.
Also the still in my name excuse doesn't wash. If you couldn't post a log book with the other persons name on it then you shouldn't be looking for loans off anyone.
Obviously I was a candidate as you put it if they give me a loan a few months prior and really I don't care what you think of about the tax book. Also point out where did I say it was the problem of the cu. my point being I was making full payments plus a but extra on the loan and they would not give me the small loan I was looking for the ensure I was still able to make the payments0 -
Eli Manning wrote: »They don't have to give you anything and obviously you weren't a candidate for a loan.
Eli, I'd suggest you read Nora Herlihy's autobiography which outlines the motivations behind her setting up the Credit Union movement in Ireland. It's exactly for reasons like this that the movement was founded.
There are thousands of people the length and breath of this country who have avoided jail., who have got to keep their home etc because their cu was there for them.
I looked at the agm report of my credit union for 2007 compared it with Newbridge 2007 accounts which are on the website. For our credit union to reach the same average loan size as that of Newbridge our cu would have to issue the equivalent 170 loans of €750,000.
So a cu which could give 6 & 7 figure loans to some members couldn't give a mere €500 to a member facing jail.
The only question which should be asked is why the Central Bank didn't close it down years earlier.0 -
Interesting thread.
Guil, the Credit Union is not obliged to give you a loan. They "should" assess your circumstances and make a decision from there. Credit Unions in 2013 have got to be more strict on lending (given the level of defaults), and although I am huge supporter of the movement itself, they too got sucked in to the "Credit Boom". Some more so than others.
If you were refused a loan, there is a reason, for example, poor credit history (which IS a factor for Credit Unions), or they felt you could not meet the repayments. Or they felt the "van was in my name story" was horse manure.
Re - Newbridge Credit Union - From what I read on it, it sounds like lending policy was far to loose during the boom. They got so bogged down in large value loans, and now they have no idea how to recover it.
Putting an accountant in there hasn't and won't make a shred of difference. Isn't it amazing that the same firm who audited Anglo and found nothing, has sent someone into Newbridge. Amazing.
Feel sorry for the members and for the people who served the Credit Union with honesty and in the best interests of it's members.0 -
The Central Bank has confirmed that Newbridge Credit Union's building will not be required following completion of a merger between Newbridge and Naas CU The Central Bank is driving the amalgamation, which should be completed before the end of December.
It will create a credit union with 59,000 members
Newbridge CU's board valued the purpose built offices as worth €15.8 million in 2010
In an up-date issued to the High Court, the Central Bank has confirmed this new entity will not require Newbridge CU's offices as part of the transaction.
However, neither the Central Bank nor the Special Manager has sold, or agreed to sell, the Newbridge Credit Union building.
Until new premises are secured in Newbridge, it is expected that the combined credit union’s Newbridge operation will continue to operate from Newbridge Credit Union’s current premises.
Is there anything stopping the people of newbridge closing there accounts when the almagamtion happens a setting up a "the new newbridge credit union" or will any thing like that be shot down straight away.0 -
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In fairness, Newbridge CU, as was, never needed the building, so it's a reasonable statement the new merged entity won't need it. Was the old teller hatches hall ever used for anything after the new one was built? The massive new extension, built not long after the original new building was a sore point for many people I know from the beginning, so I wouldn't be attached to it. Apparently at least one of the landowners got 'an offer they couldn't refuse'.
Agree it is galling, in the extreme, that these same companies get the business in good times and in bad, when they did nothing to halt the mad lending and other shenanigans. And Luke Charlton is certainly not worth the money as anyone could have negotiated a bailout and take-over, if he had saved the CU, perhaps I would give him a quarter of what he's getting. Why did the Board not challenge his fees, surely there is a mechanism in examinership for this.
I thought I read somewhere that the Board of Newbridge CU has to agree to the 'merger', if that is the case, why isn't the Save Newbridge CU campaign focused on getting them to say no? Or why didn't we hear 18 months ago that the Board had a gagging order, surely it wouldn't have breached it to say just that.
The drip drip information from the Central Bank is appalling, they should make a definitive statement on the current Balance Sheet so at least we can have an informed opinion. Does anyone know did the Board revalue the building between 2008 and 2010 when the market dropped - I don't have their accounts and don't think they are online.0 -
Does anyone know did the Board revalue the building between 2008 and 2010 when the market dropped - I don't have their accounts and don't think they are online.
No , they had the same depreciation figure for each year. The building had a very high valuation and was counted as an asset on the books for valuation equal to building cost.
Holding the depreciation value would be common practise but I am unsure how you look at a building that is owned on the books. Can you claim asset value equal to cost ?0 -
In fairness, Newbridge CU, as was, never needed the building, so it's a reasonable statement the new merged entity won't need it. Was the old teller hatches hall ever used for anything after the new one was built? The massive new extension, built not long after the original new building was a sore point for many people I know from the beginning, so I wouldn't be attached to it. Apparently at least one of the landowners got 'an offer they couldn't refuse'.
Agree it is galling, in the extreme, that these same companies get the business in good times and in bad, when they did nothing to halt the mad lending and other shenanigans. And Luke Charlton is certainly not worth the money as anyone could have negotiated a bailout and take-over, if he had saved the CU, perhaps I would give him a quarter of what he's getting. Why did the Board not challenge his fees, surely there is a mechanism in examinership for this.
I thought I read somewhere that the Board of Newbridge CU has to agree to the 'merger', if that is the case, why isn't the Save Newbridge CU campaign focused on getting them to say no? Or why didn't we hear 18 months ago that the Board had a gagging order, surely it wouldn't have breached it to say just that.
The drip drip information from the Central Bank is appalling, they should make a definitive statement on the current Balance Sheet so at least we can have an informed opinion. Does anyone know did the Board revalue the building between 2008 and 2010 when the market dropped - I don't have their accounts and don't think they are online.
There were a lot of credit unions and all other businesses had their property valued on the up side when the market was doing well. It enabled businesses to get better credit lines from their banks for instance.
Property in all cases was over valued. In Newbridge CU the regulator insisted that the credit union seek a valuation of the building and apply that current market value to the building forcing a bookkeeping hit on the credit unions balance sheet.
I would make this point you live in your house and do not intend to sell it now or in the distant future but let say your bank manager tells you since your house is no only worth have what you paid for it you are going to have to set aside half your wages to cover this book keeping loss. This has happened to every credit union in the country that owns a property every year the credit unions are obliged to get a valuation report. My point if the credit union lives and operates out of its premises.
In future the members will not be able to elect their directors under the new act the nominations committee will decide who will be put forward so if a clique get imbedded in any credit union the members will not be able to do anything about them. Members in future are to be appointed following clearance from the central bank yes the members can vote but only for those on the list. I know what you may thing just reject them well you can but at the meeting after the AGM the board can co-opt the on to the board anyway. What a farce0 -
roy rodgers wrote: »the credit union has been around in newbridge for the last 45 years and was doing right well until greed took over the directors and lost the whole ethos of the union cause they were in the same job for too long..
they gambled on the Celtic tiger like Anglo and that was there down fall
I agree with you but why not open the book and show the members. I find it odd that the central bank is prepared to have the AGM after the merger. The members of Newbridge credit union deserve the truth. I personally have been shocked at the way some central bank have denigrated Newbridge credit union in private in the old Irish way Ah what was going on there was a disgrace, you would want to see the books and they would go on and on. I would not be happy until the whole affair is out in the open and let people judge on the facts. it is most unfair to all concerned to have people condemned by speculation and sheer malicious gossip.0 -
In fairness, Newbridge CU, as was, never needed the building, so it's a reasonable statement the new merged entity won't need it. Was the old teller hatches hall ever used for anything after the new one was built? The massive new extension, built not long after the original new building was a sore point for many people I know from the beginning, so I wouldn't be attached to it. Apparently at least one of the landowners got 'an offer they couldn't refuse'.
Agree it is galling, in the extreme, that these same companies get the business in good times and in bad, when they did nothing to halt the mad lending and other shenanigans. And Luke Charlton is certainly not worth the money as anyone could have negotiated a bailout and take-over, if he had saved the CU, perhaps I would give him a quarter of what he's getting. Why did the Board not challenge his fees, surely there is a mechanism in examinership for this.
I thought I read somewhere that the Board of Newbridge CU has to agree to the 'merger', if that is the case, why isn't the Save Newbridge CU campaign focused on getting them to say no? Or why didn't we hear 18 months ago that the Board had a gagging order, surely it wouldn't have breached it to say just that.
The drip drip information from the Central Bank is appalling, they should make a definitive statement on the current Balance Sheet so at least we can have an informed opinion. Does anyone know did the Board revalue the building between 2008 and 2010 when the market dropped - I don't have their accounts and don't think they are online.
I am a credit union director for many years and I rememberwhen credit unions set up operations in schools and town halls. It was a proudday when the credit union got a place of its own with its name proudlydisplayed as a sign of collective community achievement.
I have attended many meetings in the Newbridge Credit unionbuilding because they had the facilities to accommodate groups and yes this wasbefore the hit in 2008. I remember my feelings at the time was that the peopleof Newbridge could be justifiably proud of their credit union, this currentpolicy of undermining credit unions without the display of any evidence, willleave both rural and urban Ireland without a valuable community asset. In tenyears when the drug lord money lenders have destroyed community’s will the politicianssee sense I would see Newbridge taking over Naas as a more viable proposition.
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In fairness, Newbridge CU, as was, never needed the building, so it's a reasonable statement the new merged entity won't need it. Was the old teller hatches hall ever used for anything after the new one was built? The massive new extension, built not long after the original new building was a sore point for many people I know from the beginning, so I wouldn't be attached to it. Apparently at least one of the landowners got 'an offer they couldn't refuse'.
Agree it is galling, in the extreme, that these same companies get the business in good times and in bad, when they did nothing to halt the mad lending and other shenanigans. And Luke Charlton is certainly not worth the money as anyone could have negotiated a bailout and take-over, if he had saved the CU, perhaps I would give him a quarter of what he's getting. Why did the Board not challenge his fees, surely there is a mechanism in examinership for this.
I thought I read somewhere that the Board of Newbridge CU has to agree to the 'merger', if that is the case, why isn't the Save Newbridge CU campaign focused on getting them to say no? Or why didn't we hear 18 months ago that the Board had a gagging order, surely it wouldn't have breached it to say just that.
The drip drip information from the Central Bank is appalling, they should make a definitive statement on the current Balance Sheet so at least we can have an informed opinion. Does anyone know did the Board revalue the building between 2008 and 2010 when the market dropped - I don't have their accounts and don't think they are online.
No I am afraid that is not the case the Naas board have to agree the Special Manager will just have to get a High Court order and its done.0 -
I am a credit union director for many years and I remember when credit unions set up operations in schools and town halls. It was a proud day when the credit union got a place of its own with its name proudly displayed as a sign of collective community achievement.In fairness, Newbridge CU, as was, never needed the building, so it's a reasonable statement the new merged entity won't need it. Was the old teller hatches hall ever used for anything after the new one was built? The massive new extension, built not long after the original new building was a sore point for many people I know from the beginning, so I wouldn't be attached to it. Apparently at least one of the landowners got 'an offer they couldn't refuse'.
Agree it is galling, in the extreme, that these same companies get the business in good times and in bad, when they did nothing to halt the mad lending and other shenanigans. And Luke Charlton is certainly not worth the money as anyone could have negotiated a bailout and take-over, if he had saved the CU, perhaps I would give him a quarter of what he's getting. Why did the Board not challenge his fees, surely there is a mechanism in examinership for this.
I thought I read somewhere that the Board of Newbridge CU has to agree to the 'merger', if that is the case, why isn't the Save Newbridge CU campaign focused on getting them to say no? Or why didn't we hear 18 months ago that the Board had a gagging order, surely it wouldn't have breached it to say just that.
The drip drip information from the Central Bank is appalling, they should make a definitive statement on the current Balance Sheet so at least we can have an informed opinion. Does anyone know did the Board revalue the building between 2008 and 2010 when the market dropped - I don't have their accounts and don't think they are online.
I have attended many meetings in the Newbridge Credit union building because they had the facilities to accommodate groups and yes this wasbefore the hit in 2008. I remember my feelings at the time was that the people of Newbridge could be justifiably proud of their credit union, this current policy of undermining credit unions without the display of any evidence, will leave both rural and urban Ireland without a valuable community asset. In ten years when the drug lord money lenders have destroyed community’s will the politicians see sense I would see Newbridge taking over Naas as a more viable proposition.0 -
whitleydonal wrote: »In Newbridge CU the regulator insisted that the credit union seek a valuation of the building and apply that current market value to the building forcing a bookkeeping hit on the credit unions balance sheet.
Accounting standard FRS 11, Impairment of Fixed Assets and Goodwill or the new version, IAS 36 Impairment of Assets, seeks to ensure that assets are not carried at more than their recoverable amount. All Boards of Directors are required to conduct an impairment test where there is an indication of impairment of an asset.
Property prices in Ireland have declined 50%, this event triggered an impairment review and hence the Central Bank, as regulator, were well within their rights to insist on a valuation. The auditors should not have signed off on the accounts without having insisted on this also, before the accounts ever got to the regulator in the first place.
An alternative to revaluing buildings would be to look at the NPV of future cash flows arising from the use of the building. However, as Newbridge sustained serious losses on loans it issued, future cash-flows would have been negative.
In plain English, the Board of Newbridge CU invested €18m of the savings of the ordinary people of Newbridge into a Building. That building is probably realistically only worth €4-5m now - i.e. €14m of savings have been lost, whether this is a book-keeping hit or not, it is members money. The price of the building may recover in 15-20 years, however this will have been caused by inflation, and we all know that €20 now will be buy a lot more than €20 in 15 years time, hence the need to accurately reflect the loss.
I cant follow what you are saying here. For the generation of people who find themselves in negative equity the situation is as follows:whitleydonal wrote:I would make this point you live in your house and do not intend to sell it now or in the distant future but let say your bank manager tells you since your house is no only worth have what you paid for it you are going to have to set aside half your wages to cover this book keeping loss.
Mr A Purchased House in 2006 for €300,000 with a mortgage of €270,000: Net worth = (300-270) 30k. Mortgage serviced from wages at a cost of approximately €1,500 per month.
Neighbour, Mr B sells adjoining house in 2013 for €140,000.
Mr A Net worth 2013: €140,000 less outstanding mortgage €260,000 = (140-260) Negative €-120k. Mortgage still serviced from wages at cost of approximately €1,500
The only thing that has changed for Mr A is that he has lost €160k on his investment and life is now very depressing.
This generalisation is not supported by any facts. There are only a small number of CU's in bother as a result of the property investments.whitleydonal wrote:This has happened to every credit union in the country that owns a property every year the credit unions are obliged to get a valuation report. My point if the credit union lives and operates out of its premises.
Every CU which owns a property does not have to have a valuation each year. A valuation is only required where as outlined above there in an indication that its value as dropped below its carrying value, or if the Board itself decided it wanted to have the building revalued themselves - in the latter case, once a building has been revalued then the board is required to continue to have a full revaluation performed every three years with a review performed each year.
I agree with you on this one, I have serious reservations about the pre-approval - One possible to ensure that there is some form of democracy retained would be for the members to ensure that the board introduce a policy where the people to be considered for nomination in the following year, are 'elected' at the current AGM. This would ensure that a clique could not form, it would also provide time for new nominees to received appropriate training to ensure that they meet the regulators requirements.whitleydonal wrote:In future the members will not be able to elect their directors under the new act the nominations committee will decide who will be put forward so if a clique get embedded in any credit union the members will not be able to do anything about them. Members in future are to be appointed following clearance from the central bank yes the members can vote but only for those on the list. I know what you may thing just reject them well you can but at the meeting after the AGM the board can co-opt the on to the board anyway. What a farce
The other which I agree with you on is that it is absolutely scandalous that new powers given to the central bank by our TD's allow the central bank do everything they want behind closed doors. The members of Newbridge deserve to have the facts presented to them, whether they like these or not is another issue.0 -
badgerbroc11 wrote: »Accounting standard FRS 11, Impairment of Fixed Assets and Goodwill or the new version, IAS 36 Impairment of Assets, seeks to ensure that assets are not carried at more than their recoverable amount. All Boards of Directors are required to conduct an impairment test where there is an indication of impairment of an asset.
Property prices in Ireland have declined 50%, this event triggered an impairment review and hence the Central Bank, as regulator, were well within their rights to insist on a valuation. The auditors should not have signed off on the accounts without having insisted on this also, before the accounts ever got to the regulator in the first place.
An alternative to revaluing buildings would be to look at the NPV of future cash flows arising from the use of the building. However, as Newbridge sustained serious losses on loans it issued, future cash-flows would have been negative.
In plain English, the Board of Newbridge CU invested €18m of the savings of the ordinary people of Newbridge into a Building. That building is probably realistically only worth €4-5m now - i.e. €14m of savings have been lost, whether this is a book-keeping hit or not, it is members money. The price of the building may recover in 15-20 years, however this will have been caused by inflation, and we all know that €20 now will be buy a lot more than €20 in 15 years time, hence the need to accurately reflect the loss.
I cant follow what you are saying here. For the generation of people who find themselves in negative equity the situation is as follows:
Mr A Purchased House in 2006 for €300,000 with a mortgage of €270,000: Net worth = (300-270) 30k. Mortgage serviced from wages at a cost of approximately €1,500 per month.
Neighbour, Mr B sells adjoining house in 2013 for €140,000.
Mr A Net worth 2013: €140,000 less outstanding mortgage €260,000 = (140-260) Negative €-120k. Mortgage still serviced from wages at cost of approximately €1,500
The only thing that has changed for Mr A is that he has lost €160k on his investment and life is now very depressing.
This generalisation is not supported by any facts. There are only a small number of CU's in bother as a result of the property investments.
Every CU which owns a property does not have to have a valuation each year. A valuation is only required where as outlined above there in an indication that its value as dropped below its carrying value, or if the Board itself decided it wanted to have the building revalued themselves - in the latter case, once a building has been revalued then the board is required to continue to have a full revaluation performed every three years with a review performed each year.
I agree with you on this one, I have serious reservations about the pre-approval - One possible to ensure that there is some form of democracy retained would be for the members to ensure that the board introduce a policy where the people to be considered for nomination in the following year, are 'elected' at the current AGM. This would ensure that a clique could not form, it would also provide time for new nominees to received appropriate training to ensure that they meet the regulators requirements.
The other which I agree with you on is that it is absolutely scandalous that new powers given to the central bank by our TD's allow the central bank do everything they want behind closed doors. The members of Newbridge deserve to have the facts presented to them, whether they like these or not is another issue.
Sorry the point I was making about property is that if its your only house or premises you live and work from it you can carry the drop in price because the loss only arises when you sell.
It may seem daft but the central is insisting that every credit union that owns a property have a current valuation carried out on each years accounts. In the case of my own credit union we simply carried the building at cost, its value did go up considerably over the years but out carrying it at cost was a good idea, it is a matter of accountants.
The central bank has let power go to its head for instance our entire board was told to go nothing wrong other than it was decided that we were there too long and here is the big point we are not allowed to tell the members. Personally I am only too happy to leave as I feel that with all this bullying the credit union ethos will be lost and so back to the money lenders. No wonder WONGA wants to set up in Ireland. It makes me wonder what is behind all this heavy handed approach. I have yet to see a penny of the taxpayers money lost because of the actions of a credit union unlike our friends in the banks. It is another fact that the first time the Bank resolution act was used its against a credit union. makes you think.0 -
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badgerbroc11 wrote: »Eli, I'd suggest you read Nora Herlihy's autobiography which outlines the motivations behind her setting up the Credit Union movement in Ireland. It's exactly for reasons like this that the movement was founded.
There are thousands of people the length and breath of this country who have avoided jail., who have got to keep their home etc because their cu was there for them.
I looked at the agm report of my credit union for 2007 compared it with Newbridge 2007 accounts which are on the website. For our credit union to reach the same average loan size as that of Newbridge our cu would have to issue the equivalent 170 loans of €750,000.
So a cu which could give 6 & 7 figure loans to some members couldn't give a mere €500 to a member facing jail.
The only question which should be asked is why the Central Bank didn't close it down years earlier.
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Did you know that there is a new dictat from the central bank in that a credit union cannot give a member a loan if their mortgage is in arrears or is the subject of a forbearance agreement. We were unable to give a member a loan for school books and uniform but what will happen as night follows day people will be forced back into the hands of moneylenders who are not covered by this restriction, now how interesting is that. Now you may say only right but in all this mess life must go on, in all my years of experience, birthdays Christmas and other child related events will still happen no matter where the money comes from, I just think it is better coming from someone who knows the member like a credit union.0
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