A chara, – Fintan O’Toole’s article on the burning of credit union bondholders (“Credit unions the only Anglo bondholders the Government has faced down”, Opinion & Analysis, July 9th) is further evidence of the ongoing Government hypocrisy in regard to the repayment of the Anglo debt, which was transferred onto the shoulders of Irish citizens.
It is simply astonishing that a not-for-profit financial institution with over two million Irish citizens as shareholders should take a hit of €15 million when oligarchs, hedge fund billionaires and international tycoons are paid every last cent by the selfsame Irish citizens.
I have monitored this issue closely for a number of months and written a formal letter to EU internal market commissioner Michel Barnier in March of this year requesting that he investigate the legality of the Irish Government decision to “burn” credit union bondholders in IBRC.
His response indicated that while deposits held by credit unions in banks would be eligible for deposit protection under the EU deposit guarantee scheme, this is limited to €100,000 in Ireland and consequently credit unions were burned to the tune of more than €15 million.
I am baffled by the failure of the Irish authorities to help protect the savings of so many Irish citizens who deposit small sums on a weekly or monthly basis in their local credit unions. Credit unions have to date not received any bailout monies or any State assistance and yet small depositors of these community-owned and managed financial institutions have been sacrificed in order to feed the black hole that is Anglo Irish Bank.
Credit unions remain at or near the bottom of the food chain when it comes to settlements under the personal insolvency legislation or the pilot plan designed by the Central Bank to help overstretched borrowers with multiple loans. The Irish League of Credit Unions is not participating in the latter scheme, and with good reason.
As we throw up our hands in horror at events over the last few years, right now and right under our noses, banks continue to hold all the aces. The fear of further bank bailouts as we unravel our personal indebtedness problems could ensure collateral damage to the credit union movement.
Not all credit unions acted prudently during the Celtic Tiger years, but the majority did and they continue to stand by their communities. It is not too late for the Government to reverse this course, but with pressure increasing from the Central Bank, it seems certain that our national leadership in Pontius Pilate fashion is washing its hands of the problem for now. Once again, bankers are calling the shots.
If the Government cannot move to protect and ring-fence the savings of over two million citizens, then fundamentally nothing has changed in this country, and I despair at the thought. – Is mise,
MARIAN HARKIN, MEP