Savings cap removed, new deposit account, and dividend returns for St Canice's Credit Union in Kilkenny

At the AGM of St Canice's Credit Union in Kilkenny

placeholder image — At the AGM of St Canice's Credit Union in Kilkenny

St Canice’s Credit Union members are celebrating the return of a dividend paid after five years without, following what has been a strong performance by the local organisation in 2023.

As the credit union approaches its 60th anniversary this year, the Board of Directors proposed a dividend of 0.35%, while reporting a surplus of €2.85 million. The theme of last week’s AGM was very much ‘honouring the past by protecting the future’.

Credit Union CEO Carmel Butler told the meeting that after a challenging 2022, last year had seen a strong financial performance, and the impact of the rising interest rates globally has seen a positive increase in investment income.

The total assets of St Canice’s at the end of the financial year are €474 million which is an increase of €11 million on last year. Total reserves at the end of the year prior to distributions were 16.1%. Ms Butler said the strong reserve position would protect the credit union in difficult times and made it one of the safest and strongest credit unions in the country.

Loan income grew by 6.3% during the year and totalled just over €7 million. It was a record-breaking year for the loans department, and in November the loan book grew to €100 million for the first time in the credit union’s 60-year history. By the end of the financial year, this had grown to €115 million.

Overall in the year, €60 million in loans was issued to members. The greatest loan growth was seen in house mortgage lending, as where 60 house loans were issued to the value of €10.7 million. The growth in mortgage lending has largely come about due to the credit union’s competitive mortgage rates.

While other financial institutions have increased their rates throughout the year, the Board of St Canice’s delayed taking this action for as long as possible and as a result has one of the most competitive rates in the country.

In addition to mortgage lending, the credit union has lent over €2 million to local businesses and €48 million in personal lending. Ms Butler said it was important to remember what impact this level of lending has on local economies.

BENEFIT

“Not only do the loan applicants benefit from the proceeds, but these funds go out into our local economy and help support local garages, shops and businesses, which in turn supports employment in these areas and growth in our communities,” she said.

Lending performance is strong and while repayment levels are good, Ms Butler said the credit union was conscious that the higher costs of living may impact many members. This is already being borne out, and the level of bad debts written off during the year more than doubled, from €235,000 to €559,000.

With this in mind, the credit union has opted to e increase its bad debt provision for the year by €927,000, which has had an impact on the final surplus figure.

In the last 12 months, the St Canice’s credit control, collected over €1.1 million in non-performing loans, which is largely in line with previous years.

There is further good news with confirmation that the savings cap of €30,000, introduced during the economic uncertainty of the pandemic years to protect reserves and meet regulatory requirements, will now be removed. With its removal, members can now hold up to €100,000 in the credit union, which is 100% covered by the Deposit Guarantee Scheme.

Chair Vincent Kerwick

In view of this, chairperson Vincent Kerwick encouraged everyone to once again use the credit union as a responsible and safe repository for their savings.

In addition to the removal of the savings cap, a new Deposit Account is to be introduced. This deposit account is for a two-year fixed term and will pay an interest rate of 2% per annum. Further details are available on our website or in any of our branches.

The credit union Board also allocated €100,000 additional Community Connect funds to support community projects. Speaking from floor, John Knox also noted that there were over 100 applications to the community fund, but only 50 were issued. This would be disappointing for unsuccessful applicants. He said it might be better to tighten up the criteria or have a chat with people before formal applications are made. Ms Butler said this idea would be taken on board.

Finally, Mr Kerwick said the need for additional volunteer workers in St Canice’s Credit Union continues to be pressing. If any member feels they would like to contribute and wish to volunteeer, they should leave their name and contact details with any credit union staff.