Dear Editor,
In response to John McManus’s recent article on credit unions and their role in the mortgage sector, I would like to express my concern as it seems the article might have overlooked some crucial developments within credit unions in the past ten years. It is imperative to acknowledge that these co-operative bodies are not only robustly entrenched and adequately capitalised but are also prudently conducted and rigorously supervised. Proven by their ranking as the nation’s most reputable institution for two consecutive years in the 2024 RepTrak study, and their unmatched nine-year streak as champions in the CXI Customer Experience Awards, credit unions are a force not to be taken lightly.
It would decimate competition and constrict consumer options to deprive credit unions of the chance to provide mortgage services. These unions have shown adequacy, control and capacity to engage competitively in this market. The mortgage landscape in recent years has seen vast change, with only three pillar banks holding sway since the departure of Ulster Bank and KBC.
With an impressive association of almost 3.2 million individuals nationwide, both incumbent and prospective credit union members are entitled to, and in many cases insist, access to mortgage services from sound, reliable financiers that comply fully with statutory requisites.
Credit unions, in contrast to new market entrants, have shown an upward trend in the mortgage area, demonstrating their adherence to international best practice, in which well-established credit union institutions globally count mortgage lending as a significant portion of their loan portfolio. Ireland is unique in its deficiency in this respect.
The not-for-profit model of credit unions enables them to focus on serving their communities with the provision of mortgage services, rather than prioritising profit-making. In our role as a community, we adhere to the currently set lending limits, which we find overly hefty and no longer representative of the wants of a rapidly evolving Irish society hungry for choice. Were these limits to be lessened, the meticulous exactitude that marks all credit union lending practices would be used in the area of mortgage lending.
It is important to address a key issue regarding the necessity for a more flexible approach to loaning limits. Recently, a study undertaken by the International Credit Union Regulators’ Network, based in the United States, examined the legislative controls of the Central Bank on Irish credit unions. This review emphasised that the appreciated revisions in the Credit Union Amendment Act could be rendered ineffective if alterations were not made to the mortgage restrictions.
This is a situation we cannot permit since credit unions hold an invaluable position in supporting Ireland’s communities through their top-tier services and offerings. Best Regards,
Mark Beirne,
Chief Executive Officer,
Savvi Credit Union,
Dublin 2.