The High Court has directed the immediate transfer of the business of Howth Sutton Credit Union (HSCU) to the Progressive Credit Union, with registered offices in Balbriggan, Co Dublin.
When seeking the order this afternoon, the Central Bank stressed the move will not affect members, creditors, employees or data of Howth Sutton Credit Union (HSCU) for whom it will be "business as usual" under the new arrangement.
HSCU was consenting to the order, the court heard.
The Central Bank wanted the order arising from its serious concerns about the financial stability of the credit union which, it believed, could not be adequately addressed unless the order was made, the court heard.
The bank considered there would be “very serious” consequences if the order was not made and it was also “absolutely critical” that it take immediate effect, its counsel Paul Gallagher SC said.
It was considered that a winding up of the credit union was not in the interests of its members or in the public interest, counsel said. The unquantifiable costs of a liquidation included the impact on the credit union sector and on confidence in financial institutions generally, he said.
The bank considered members of the credit union would “suffer greatly” if the order was not made, counsel added.
The bank considered the transfer was “a very successful outcome” to a lengthy and difficult process aimed at safeguarding the interests of the members of the credit union and ensuring financial stability.
The President of the High Court, Mr Justice Nicholas Kearns, said he was satisfied to make the order sought.
HSCU had been experiencing difficulties since 2009 and a series of efforts to resolve those involving the bank, regulator of credit unions and other parties had proven unsuccessful, the court was told.
The credit union itself supported the Central Bank’s application for transfer of the business and was happy the application was being made, it was stated. A voluntary restructuring of the credit union was explored but had not proven possible, the court heard.
The transfer order was sought under the provisions of the Credit Institutions
Financial Stabilisation Act.
