Brussels, 04/05/2016 (Agence Europe) - On Wednesday 4 May, the European Commission approved the prolongation, of an Irish aid scheme aiming to restructure the credit union sector until 31 October of this year.
The restructuring will involve the merger of the weakest and the strongest credit unions by providing a capital injection if required to cover any shortfall in the capital reserves of the entities born of these mergers. A stabilisation phase will then help viable unions which have seen their capital reserves dip temporarily below the minimum requirements.
The scheme has an envelope of €250 million for the financing of the mergers by the Irish State and €30 million to stabilise specific credit unions by means of a levy on the sector.
The Commission considers that the measures will ensure that the beneficiaries return to long-term viability and participate in the cost of the restructuring. It also takes the view that the impact on competition will be negligible as the unions in question are small. The scheme was approved for the first time in October 2014 and has been prolonged on a number of occasions. (Original version in French by Elodie Lamer)