tag:blogger.com,1999:blog-5460637983397119698.post7125090112351996171..comments2008-04-23T23:53:54.764+01:00Monty Cardiganhttp://www.blogger.com/profile/16273003125079163797noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-5460637983397119698.post-28172358920673376772008-04-23T23:53:00.000+01:002008-04-23T23:53:00.000+01:00Credit Union investment losses are currently being financed from either operating income or reserves but not from member’s savings/money. In the same way loans losses are financed through provisions and write offs. Thus to say that member’s money is being lost may be somewhat incorrect. <BR/><BR/>Of course member’s value is being impaired as investment losses tend to reduce a dividend/interest rebate, reduce investment in better products/services including lowering loan rates and impair reserve creation. <BR/><BR/>The dearth of investment competence exposed recent events should cause all credit union boards to take stock of their duty of care to ensure safety and soundness. This includes ensuring the credit union is a competent financial co-operative with the skills and abilities to undertake the business of a credit union which includes prudential investments that do not expose members savings to undue risks.mountstreethttp://www.blogger.com/profile/16273003125079163797noreply@blogger.comtag:blogger.com,1999:blog-5460637983397119698.post-36179733299325003422008-04-22T23:46:00.000+01:002008-04-22T23:46:00.000+01:00"So far members money has not been lost", Mount Street says. Rubbish! Some €46 million has already been lost on perpetual bands. Nearly as much more has been lost in ill-fated ISTC bonds. Credit Unions are losing an average of €35,000 principal, not to mention interest foregone, in every million they have invested in the ILCU's Central Treasury Fund. Credit Union members' money is being lost daily by a combination of sheer incompetence and ignorance.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-5460637983397119698.post-12178665960175125322008-04-21T00:18:00.000+01:002008-04-21T00:18:00.000+01:00The Regulator has no role in the oversight or regulation of the ILCU SPS. The finger points to the Department of Finance whose officials are intent on a solution within the context of curent legislation - codespeak for negotiate the approval and regulate the ILCU SPS. To be fair to the Regulator it did produce a draft heads of a bill for a scheme not unlike the O'Toole Bill in early 2006 following ILCU proscratination and obfuscation. The ILCU countered by appealing directly to the Minister -<BR/><BR/>So far members money has not been lost - what has happened is credit unions (regulated financial firms) have engaged in highly imprudent income maximisation investment strategy, with the backing of the ILCU - leading to losses in highly innappropriate products- none of which yet has resulted in substantial danage to solvency. Nonetheless savers funds have been exposed to undue risks - The Regulator has been rather quite of late - one wonders what the true scale of undue risks are.mountstreethttp://www.blogger.com/profile/16273003125079163797noreply@blogger.comtag:blogger.com,1999:blog-5460637983397119698.post-26052498600946372212008-04-19T20:54:00.000+01:002008-04-19T20:54:00.000+01:00It is about time that the Financial Regulator got the finger out - credit union members moneys are being lost in massive investment losses, through the Perpetual Bonds directly, through the Central Treasury Fund and through the so called Savings Protection Scheme Fund. The Regulator stands off, waving an accusing finger, and ultimately doing nothing. <BR/><BR/>The ILCU has no investment management skills. The Regulator allows credit unions to plough members money into an un-regulated so-called "protection fund". I blame the Financial Regulator for playing the political game of turning the blind eye towards the ILCU fund. The so-called "accounts" of this significant fund are far from transparent.<BR/><BR/>Regulator - get off the fence.Anonymousnoreply@blogger.com