FERMOY CREDIT UNION SAFE, STRONG AND SECURE BUT NO DIVIDEND PAYABLE THIS YEAR!
In what has proven to be a hugely difficult year in financial circles, Fermoy Credit Union has reported a strong and secure balance sheet in its annual report just published.
In a resolute statement, chairman William Lonergan said Fermoy Credit Union was ‘safe, strong and secure’ and said additional provisioning is to ensure ‘that we remain strong and secure for our members in the future’.
He said normal business and lending was continuing, there were no capital issues and he is confident that Fermoy Credit Union has the expertise, experience and commitment necessary to weather the current financial crisis.
Overall, the credit union has a deficit of €1,367,236 up to September of this year brought about mainly by the transferral of over €2.3million into bad and doubtful debt provision plus a write-off of over €1.1million.
This has resulted in the recommendation by the board not to pay a dividend this year.
The board of directors feel the bad and doubtful debt provision is a very prudent step, ‘one that will safeguard the credit union against further impairment of the loan book’.
“The decision not to recommend a dividend is a reflection of the unprecedented and extraordinarily challenging economic climate in which we operate. While this action is regrettable, the board are of the opinion that it is necessary so as to place the credit union in a much stronger position going forward,” the report states.
The Avondhu spoke with Martina Cotter, manager of Fermoy Credit Union who said: “We will not be paying a dividend, it has been a tough year. We have to provide for bad debts, as people are under even more pressure now, due to job losses and hours being cut. It is more prudent to strengthen our reserves”.
Martina continued to say that their approach is to strengthen the credit union going forward.
“Our message to the members is that our door is open, and we are lending on a daily basis. We are very understanding and sympathetic and urge any member that is in financial difficulty to come to us at an early stage so we can work on a repayment schedule.”
Fermoy Credit Union issued a figure just short of €7million in loans last year to 1,849 members. An example showing the benefits of borrowing from the credit union (9.4%APR) against a moneylender (157.3% APR) is illustrated in the report by the chairman of the credit committee, Christy Roche.
Urging members to be cautious of licensed moneylenders, the example showed the cost of a credit union loan of €500 over twelve months to be €23.12 against a massive €280 from a licensed moneylender. Appealing to its members for their support, the board are confident that Fermoy Credit Union will grow, prosper and continue to develop its range of services to its members.
“Our fundamental core values of caring, sharing and service will never change. The board of directors appeal to you for your continued support during these most challenging times as we take decisions which deliver long term stability over short term gain.”
Thursday 9th December 6:39pm