Extension sought for Newbridge special manager

An application will be made on Monday by the Central Bank to further extend orders under which a special manager was appointed to Newbridge Credit Union almost a year ago. The appointment of Luke Charleton is due to expire next month.

Brian Kennedy SC, for the Central Bank, was yesterday given leave by the president of the High Court, Mr Justice Nicholas Kearns, to serve short notice of the application, which was based on an affidavit on behalf of the Central Bank containing what was described as commercially sensitive material that cannot be published by court order. The affidavit is to be disclosed, except for one paragraph, to the directors of the credit union.

The application is brought under the Central Bank and Credit Institutions Resolution Act 2011. On the application of the Central Bank, Luke Charleton of Ernst Young was appointed special manager last January after the court was told draft financial statements for 2011 indicated NCU did not hold the reserves required under the Credit Union Act and there was uncertainty about its true financial position.

The special management order was made with the agreement of the Minister for Finance and was considered to be in the best interests of the depositors of NCU, which has about 37,000 members, the court was told.

The NCU board had disputed the need to appoint a special manager and, in correspondence, said it failed to see how there could be uncertainty about the credit union’s financial position. The board also said no issues had been raised by its auditors and it had a business plan.

Mr Justice Kearns was told last July there was agreement Mr Charleton’s appointment could be extended for a further six months, a period that expires in mid January.

At that hearing, Bernard Dunleavy, for the board, said there were matters the directors wished to raise with the court. Since the appointment, they had been “under a cloud”, but the manager’s report contained no allegations of wrongdoing, he said.