Call on Clonmel Credit Union not to consider any mergers in the future

Call on Clonmel Credit Union not to consider any mergers in the future

Cllr Richie Molloy - called on Clonmel Credit Union not to consider any mergers.

A councillor has said Clonmel Credit Union shouldn't seek to merge with any further credit unions in the wake of the appointment of liquidators to a Co. Cork credit union that Clonmel CU engaged in merger talks with earlier this year. 

Clonmel Credit Union's Board of Directors decided against proceeding with the merger with the financially troubled Charleville Credit Union at the end of March. 

The decision followed disquiet over the proposed deal with 69 Clonmel Credit Union members signing a petition at a public meeting requesting a special general meeting. 

Last Friday, the High Court appointed provisional liquidators to Charleville CU after various efforts since 2007 to deal with its problems were not successful. Central to those problems was its failure to bring its reservces up to the regulatory requirement of 10 per centre of assets. Its reserves were just 3.5 per cent last June. 

Independent Clonmel Cllr Richie Molloy, a former member of Clonmel Credit Union's Board of Directors, has paid tribute to the members and Board of Directors of Clonmel Credit Union for the decision not to proceed with a merger with Charleville CU. 

And he said Clonmel CU shouldn't seek to merge with any other credit unions as it's big enough and strong enough to stand on its own. 

Clonmel Credit Union CEO Paul Davey said Clonmel CU's Board of Directors made a pragmatic decision not to proceed with the merger after carrying out due diligence,  examining all aspects of the merger deal  and receiving  financial and legal advice.  

He pointed out that Clonmel CU was assured during the merger talks that "no legacy issues" from Charleville CU would have transferred to Clonmel CU. 

He insisted opposition from members of the credit union wasn't the deciding factor in the Board's decision not to  proceed with the merger.  

He also pointed out that Clonmel Credit Union had made similar decisions not to proceed with mergers on nine other occasions previously. 

But Cllr Molloy believes credit union members' opposition was a major factor in the Board of Directors decision to abandon the merger. 

"If we had gone ahead with the Charleville CU merger I think it would have damaged Clonmel Credit Union overall, especially when Clonmel CU has been self sufficient to date," said Cllr Molloy. 

"I and a lot of other Clonmel Credit Union members couldn't for the life of me understand the need for merging with a credit union outside our common bond area." 

"I have sympathy for the staff and members of Charleville CU but we couldn't support damaging Clonmel Credit Union to prop it up." 

He fears that merging with another credit union in another county outside Clonmel's "common bond" area of 12 miles would change the credit union's ethos. 

Cllr Molloy urged Clonmel Credit Union members to attend their credit union's annual general meetings in greater numbers if they wish to have their say on its policies and direction. 

He said the attendance at the credit union's agms has been poor in the last number of years. 

"Every member has a vote and it's up to the members themselves to become active in their credit union." 

At this year's agm, Cllr Molloy said members should stress to the Board of Directors that Clonmel CU shouldn't merge with any othe credit union as it doesn't need to do so. "I understand there is pressure coming from the League of Credit Unions for credit unions to merge but I feel Clonmel Credit Union can stand alone. It's big enough." 

Mr Davey, meanwhile, said the media coverage surrounding Charleville Credit Union was regrettable as was the loss to that  credit union's staff, 12,000 members and their local community. 

Mr Davey added that Clonmel CU has focussed on its normal business activities since the merger controversy ended and it was having another very successful year.