Two teacher credit unions, Comhar Linn INTO Credit Union and Education Credit Union, secured overwhelming approval from members at special general meetings on Wednesday evening for a merger.
The deal, which is expected to see the Education Credit Union folded into Comhar Linn INTO Credit Union by the end of September, subject to Central Bank approval, secured support from more than 98 per cent of members of the two credit unions who participated in the meetings.
It marks the first phase of a wider planned transaction that would see the combined entity tie up with the TUI Credit Union next year to form the seventh-largest credit union in the Republic, with more than €450 million of assets and about 48,000 members.
Votes on the second phase are expected to take place in early 2027. The three entities currently have a total of about €220 million of loans and hold €365 million of customer savings combined.
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“We’re delighted with the results last night, which are a real endorsement of what we’re trying to achieve,” Sean Murray, chief executive of Comhar Linn INTO Credit Union told The Irish Times. “It’s really important that teachers and education support staff have a strong credit union that looks after specific financial needs.”
The three-way combination will “facilitate enhanced access to a broader range of services, including current accounts, mortgages and savings and loan services at competitive and sustainable rates”, Comhar Linn INTO Credit Union and Education Credit Union said in circulars to members before the meetings.
It will also provide greater efficiencies through sharing costs resulting in better value for members, it said, adding that all existing offices will remain open.
The number of credit unions in the Republic has fallen to about 180 from more than 400 in 2007 amid a wave of mergers, encouraged by the Central Bank.
Consolidation was initially driven by efforts to stabilise smaller players as they grappled with a slump in lending and income pressures. However, a number of more recent tie-ups have been aimed at credit unions seeking to best position themselves for growth against the backdrop of regulatory and legislative tweaks in the past five years, aimed at improving the viability of the credit union sector.
The Central Bank eased previously highly restrictive limits on long-term lending in 2020.
Laws introduced in 2023 allow credit unions to refer members to peers for services for the first time. They also enable them to club together to provide loans. And they introduced the concept of a corporate credit union – a credit union for credit unions – to support collaboration and pool certain resources.
Last year, the Central Bank gave the credit union movement additional lending flexibility, which, it estimates, would treble the sector’s capacity for mortgage and business lending to about €9.9 billion.
Credit unions, regardless of size, can now lend up to the equivalent of 30 per cent of their total assets in home mortgages. Business lending can reach as much as 15 per cent of assets.
The Irish League of Credit Unions (ILCU), which represents more than 90 per cent of credit unions in the State, said in June that the total loans of its members grew by 9.6 per cent to €6.6 billion in the 12 months to the end of March, with mortgage lending expanding by 24 per cent to €782 million. Total assets of members amounted to almost €20 billion, it said.
