Local Credit Union merger plan up for approval

A proposal to merge Kilcormac Credit Union with Tullamore Credit Union is to be voted on by members of both institutions at virtual annual general meetings later this month.

Members are being asked to approve what's known as the 'transfer of engagements' of Kilcormac Credit Union Limited to Tullamore Credit Union Limited.

In a joint statement, the chairs of the credit unions, Ray Spain (Tullamore) and James Gorman (Kilcormac), say the proposed transfer arises from the belief of both boards that members could “be better served together” and that it presents “an ideal opportunity to grow and develop our services to members locally”.

If the merger is passed at the virtual AGMs and by the Central Bank, the affairs of Kilcormac Credit Union will be transferred to Tullamore before the end of June.

Offices in Tullamore and Kilcormac will remain open for all members to transact their business. Existing loans will continue under the terms of credit agreements.

Meanwhile, it's proposed that no dividend will be paid to members this year.

This follows a circular by the Central Bank which indicated that it did not expect dividends or loan interest rebates would be a feature of the 2020 financial year.

Chair of Tullamore Credit Union Francis Mollen said the board of directors had decided against issuing a dividend for the year ending September 30, 2020, following the circular, the continued reduction in the credit union's annual surplus and interest rates available to the credit union.

Members savings increased by €28.4m during the financial year bringing total savings to €237.6m.

Mr Mollen said in more and more instances, rates on offer to deposit savings in banks were negative, meaning that it was being charged to invest funds. Finance Officer Declan McDonnell said this situation “impacts significantly on our ability to pay dividends into the foreseeable future.”

CEO Dennis Daly said the credit union has been working on a strategy of broadening the range of products and services.

He pointed out the current account now has over 2,000 users, while the mortgage package introduced in 2019, had assisted 96 members in purchasing homes by September 2020.

Tullamore Credit Union is now focusing on developing a new green energy home improvement loan for members – which could involve a complete end-to-end process involving grant applications assistance, contractor appointment and work supervision.

The creation of a new call centre to improve digital and app banking support is being proposed for 2021.

A new IT system, which Mr Daly said was the biggest project ever undertaken by the credit union, could be in a position to be launched in the third quarter of 2021.

The 2020 Virtual AGM of members of Tullamore Credit Union will take place via Zoom on Monday, April 26, at 8pm. The AGM of Kilcormac Credit Union will take place on Tuesday, April 27, at 8pm.