# CU board & auditors recommend 1.5% divident but ONLY if the CU regulator approves.



## donee (18 Nov 2011)

hi, 

Ive just been to my local CU and I enquired about the AGM and I also asked about dividend etc. 

I was told that the recommendation from board and auditors is for 1.5%, but ONLY if the regulator approves it. 

Why the heavy hand of regulation on the little guy's money and/or is it the same in the banks


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## ajapale (18 Nov 2011)

I know its not the same kind of dividend but have any banks paid dividends to their shareholders in recent years?


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## Slim (19 Nov 2011)

donee said:


> hi,
> 
> Ive just been to my local CU and I enquired about the AGM and I also asked about dividend etc.
> 
> ...



Because approximately 80 CUs could not pay any dividend last year and a number are in some difficulty this year and may be next year due to poor management and lending practices.


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## ClubMan (19 Nov 2011)

donee said:


> Why the heavy hand of regulation on the little guy's money


Or perhaps the taxpayers' money - yet again?

http://www.examiner.ie/ireland/credit-unions-to-get-1bn-bailout-169950.html


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## donee (19 Nov 2011)

sorry maybe im not making the point clearly.
if the CU obviously CAN afford to pay a dividend and their AUDITORS who would have the overall picture have signed off that they can why the need for the regulators approval


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## ajapale (19 Nov 2011)

Because, in the words of the regulator "_*... directors will .. be required to strike a balance between dividend distribution policy and the retention of reserves to protect members’ savings and the future of their credit union.*_"

aj


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## donee (19 Nov 2011)

ajapale said:


> Because, in the words of the regulator "_*... directors will .. be required to strike a balance between dividend distribution policy and the retention of reserves to protect members’ savings and the future of their credit union.*_"
> 
> aj


 and the directors and their auditors dont


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## ClubMan (19 Nov 2011)

Judging by information already available online the _CU _regulator  has previously intervened to block or allow dividends approved by  individual CU's - even after the boards in question have approved the  payment and the auditors have signed off on accounts - e.g.:

http://www.independent.ie/business/irish/regulator-clears-monaghan-credit-union-dividend-81775.html
[broken link removed]

This may also be relevant:

http://www.examiner.ie/ireland/fina...redit-unions-to-exercise-prudence-123984.html



> In the letter the regulator says he will be requesting the movement as  part of the year-end audit, to place particular emphasis on the adequacy  of the bad debt provisions in the 2010 accounts.
> 
> It also  makes clear that units of the movement will be required to make a  submission in relation to the payment of a dividend.
> 
> Those  credit unions which have to make a submission on the payment of a  dividend have been instructed in the letter not to set a date for their  Annual General Meeting and that they should not print the annual  accounts for circulation to members until agreement has been reached  with the regulator on the dividend payment question


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## ajapale (19 Nov 2011)

donee said:


> and the directors and their auditors dont



Yes, while the majority of CUs (through their directors and auditors) manage to "_*strike a balance between dividend  distribution policy and the retention of reserves to protect members’  savings and the future of their credit union*_"  a small minority clearly do not. And this is where the regulator is mandated to step in and ...well...regulate.

aj


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