€30,000 Savings Cap @ KCU!

€30,000 Savings Cap @ KCU!

***IMPORTANT NOTICE FOR ALL OUR MEMBERS***
Information Notice : €30,000 Savings Cap.
What is the new saving restriction?
Kanturk Credit Union have implemented a saving restriction of €30,000 per member since 1st November 2017. This means that each member can only have €30,000 with Kanturk Credit Union. If any member currently has over that amount in savings here, they may leave their savings as they are, but cannot increase them.
Why is Kanturk Credit Union limiting savings?
The Board took the difficult decision to limit savings to €30,000 per member after a significant increase in the amount of savings in the credit union and the knock-on implications are set out below:
1) In order to meet the Central Bank's regulatory reserve requirement, Kanturk Credit Union has to allocate €10,000 from our surplus to our reserves each year for every additional €100,000 of savings. This can have the effect of depleting the amount available to pay dividends and loan interest rebates to members at year-end.
2) The need to make transfers to reserves also reduces the amount we can afford to invest in new services and new technology options that can benefit all of our members.
3) The current low interest rate environment means that when we take in excess savings from members, we are increasingly having to pay other banks and deposit institutions to look after them with many beginning to pay credit unions negative interest rates on deposits.
While we understand that this may be inconvenient, our number one priority at all times is to serve all of our members as best we can, and this will be reflected in all decisions taken by Kanturk Credit Union.
Are my savings safe here?
Yes, they are. The limit on savings is simply to look after the best interests of all members and improve the balance sheet of Kanturk Credit Union. Kanturk Credit Union is covered by the Government's Deposit Guarantee Scheme, which is administered by the Central Bank of Ireland. Savings and deposits of up to €100,000 per member are covered.
How long will the cap last for?
The Board will keep the savings restriction under constant review. Any change to the cap will be advertised in our office and online.
Can any exceptions be made?
No. Our IT systems have been configured to ensure that all members are treated equally. Staff members will not be able to deposit amounts in excess of the cap.
Does this mean Kanturk Credit Union is in difficulty?
No, this has no bearing on the day to day operations of the credit union. Kanturk Credit Union is extremely well-capitalised with total reserves well in excess of regulatory requirements. In the past year, total savings have increased by a massive €1.74 million, and stand at nearly €50 million. The only reason for this cap is to limit the impact of this increase. We would rather be lending our existing excess savings to people locally instead of putting additional funds on deposit for no return, but savings growth continues to outpace lending growth. Thankfully lending has picked up massively in the past year with our loan book growing by nearly €1 million, but the growth of savings has been nearly twice this amount.
Does this mean Kanturk Credit Union cannot give out loans?
No, Kanturk Credit Union is in an excellent position to give out loans, subject to appropriate assessments being completed. Our ability to lend is in no way affected by the savings cap and we have large funds available for loans. We continue to provide valuable loan services to members and a wide range of loan products designed to meet all member borrowing needs. Members can borrow for most reasons imaginable. We have competitive rates with flexible repayment options and make decisions on all loan applications quickly.
For any further information don't hesitate to call 029-50276, visit kanturkcu.ie or call into our friendly staff at our office.

KCU Sponsors Scor na nOg!
IRD Duhallow Seniors Conference!