High court orders transfer of business from Howth Sutton CU to Balbriggan CU

http://www.irishtimes.com/news/irel...ness-from-howth-sutton-credit-union-1.1713580

The [broken link removed] has directed the immediate transfer of the business of [broken link removed] (HSCU) to the [broken link removed], with registered offices in Balbriggan, Co Dublin.


...The Central Bank wanted the order arising from its serious concerns about the financial stability of the credit union which, it believed, could not be adequately addressed unless the order was made, the court heard.


The bank considered there would be “very serious” consequences if the order was not made and it was also “absolutely critical” that it take immediate effect, its counsel Paul Gallagher SC said.

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From RTE

The Irish League of Credit Unions described the move as “acceptable”, saying that the HSCU’s recent financial situation had come about largely due to factors outside of its control, in particular a significant drop in the value of its premises in Howth.

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Sounds very odd to me. If they took a punt on buying a premises which has fallen in value, it sounds like it was a factor well within their control.

The premises must have been bought with shareholders' money and must have been excessive, if that is the main factor.

Well the odd thing first is that CU are required to have retained reserves of 10% against ALL assets including money at bank. [3% for banks.]

This is a relatively small credit union.

The premises valuation gets written down against reserves even though it is an unrealised loss.

In the case of Howth I think their provisions would have significantly reduced the reserves apart from the premises write down.

I don't see how a fall in the value of premises is within their control unless you are saying they should not have bought whenever they did - and sure everybody that bought post 2004 realises what fools they were.

Has anybody a set of accounts so we can have a look ?

[This is second failure out of 400. Name one Irish Bank that survived apart from Post Office Savings Bank - NIL Zero Zilch ]