Stabilisation fund levy for credit unions signed in by Donohoe

The Minister for Finance, Paschal Donohoe, has today, November 8, signed into law new credit union levy regulations.

The Credit Union Fund (Stabilisation) Levy regulations will require credit unions to pay a stabilisation levy contribution next year, for the purpose of building up a stabilisation fund.

The new levy is the fifth in a series of annual fees for this purpose.

The targeted size of the fund is €30 million, which the Department of Finance is hoping to rack up over a ten-year period.

The size of the fund, and the allotted time to reach that target, is reviewed every three years, with the first review taking place in October of last year.

After that review, it was decided that the levy rate would be reduced from 0.022% to 0.017%.

Minister Donohoe has said that he will review the regulations again by 2021, when another levy is set to be introduced.

The stabilisation fund was conceived as a result of a recommendation by the Commission on Credit Unions.

In order to be eligible for stabilisation funding, a credit union must have a regulatory reserve ratio equal to or greater than 7.5%, and lower than 10%, of its total assets.

It must also, in the opinion of the Central Bank, be viable as a credit union.