DUBLIN, Ireland (7/24/13)--A resolution plan to make Ireland's 400 credit unions more stable will be extended until December, the European Commission said Tuesday.
Despite slight modifications, the plan, first approved in December 2011, remains consistent with the commission's guidance to assist credit unions and to help support the Irish economy, said the commission (Irish Examiner July 23).
The commission created the plan to provide financial stability and minimize economic losses if a credit union becomes unable to meet the regulatory requirements set by the Irish Central Bank.
Under the plan, a failing credit union would transfer all assets and liabilities to an acquirer in a competitive process.
A resolution fund will provide a financial incentive for the acquirer, if necessary, said the commission. The state will make an initial repayable contribution to the resolution fund, which will over time be funded by levies on credit institutions, it added.
The resolution fund is financed with nearly $660.6 million from the government. The plan allows credit unions to appoint a new manager, modify liquidation and transfer credit unions assets and liabilities.