A GLOBAL financial services provider that insures almost 100 credit unions in Ireland has warned of closures in the Irish industry unless immediate changes are implemented.

At a conference in Dublin yesterday, Paul Walsh, chief executive of Cuna Mutual Europe, described the Irish credit union movement as the “Cinderella” of financial services, saying that it was the only part of the financial system “still intact”.

He predicted that credit unions would have a “bright future” but only if they changed their current practices, and collaborate on cutting costs and improving efficiencies.

“If they fail to seize this immediate opportunity, we unfortunately may see many credit union closures around the country,” he said.

This warning comes after the registrar of credit unions James O’Brien said in a recent speech that an increasing number of credit unions were now regarded as “high risk”. The is due to the sharp rise in the level of arrears at many institutions, as well as potential solvency problems.

A subsequent media report suggested that as many as 79 out of the State’s 410 credit unions were at risk of closure.

However John Lass, senior vice-president of corporate strategy of Cuna Mutual, told delegates that Irish credit unions had the ability to achieve sustainable growth of 7.5 per cent per annum.

“The challenge and opportunity for credit unions is to balance the three keys to sustainability – governance, financial structure and value proposition,” Mr Lass said.

The “Future Business Model for Credit Unions” conference was hosted by Cuna Mutual Group Europe, part of Cuna Mutual Group.

The group specialises in providing insurance to credit unions and has been operating in Ireland since 1963.