Savings Limit – Link Credit Union Ltd.
Due to the capital levels required by the Central Bank, we can no longer accept savings greater than €25,000.
The Board of Link Credit Union Limited recently carried out a review of its members savings strategy and a number of changes have been implemented which will affect our members account.
Over the past two years, the total amount of savings in our credit union has increased by in excess of €7 million. This amount of savings shows that our members have great confidence in our credit union but this also creates capital level requirement issues. For every €100 saved in the credit union we are required to set aside €10 as part of our capital requirement. As this level of savings continues to grow, the credit union will have to eat into its current reserve levels to fund this capital requirement. This year, we have made a transfer to the Regulatory Reserve in our 2017 accounts, to ensure that we remain above the legislative requirements.
We also have legal requirements with regard to liquidity as follows:
- To establish and maintain a minimum liquidity ratio of relevant liquid assets  of at least 20 per cent of unattached savings 
- To establish and maintain a minimum short-term liquidity ratio of short term liquid assets  of at least 5 per cent of unattached savings
The current negative interest rate climate, which is showing little sign of improvement, now means that Link Credit Union Limited is effectively being charged by banks to hold the funds necessary to meet these liquidity requirements. This coupled with the huge increase in our savings has resulted in the Board of Link Credit Union making an important decision that members’ savings will be capped at €25,000 per member for the foreseeable future. Existing share balances above this limit can remain in the account, but no new savings can be lodged. Should future withdrawals bring a members balance below €25,000 at any stage, the limit will apply to future lodgements, so that the share/deposit balance remains at or below €25,000.
We need members to complete the following steps by 1 January 2018:
- If you intend to leave €25,000 in your account please remember you will be unable to lodge any further funds into your share/deposit account until your savings balance is less than €25,000.
- If you have any automated banking transactions being paid to your credit union account, please contact the office to discuss this, as these may need to be re-directed to an alternative location.
Our apologies if any of the above measures have an impact on our members savings with Link Credit Union; however, it is not feasible for us to continue to increase savings that are a cost to credit union and to a level further beyond any likely demand for loans from members.
For the most part, most of our members will be unaffected by the changes outlined. At all times, our service to members sits at the heart of all our activities and we hope that as the interest rate environment improved over time, we may be in a position to review these measures to accommodate greater savings in the future. If or when the situation changes we will of course be in contact with members in due course.
Should you wish to discuss this issue with one of our team you can make an appointment with either Angela Rice, Carole Mulcahy or Ailbhe Curtis to discuss the matter.
 Relevant liquid assets mean the following: (a) cash; (b) investments with a maturity of less than 3 months, excluding the minimum reserve deposit account and the deposit protection account; (c) investments with a maturity of less than 3 months, excluding the minimum reserve deposit account and the deposit protection account, where a written guarantee exists to the effect that funds are available to the credit union in less than 3 months.
 Unattached shares mean total savings which are not attached to loans or otherwise pledged as security and are withdrawable by members
 Short term liquid assets mean the following: (a) cash; (b) ) investments with a maturity of less than 8 days, excluding the minimum reserve deposit account and the deposit protection account; (c) investments with a maturity of less than 8 days, excluding the minimum reserve deposit account and the deposit protection account, where a written guarantee exists to the effect that funds are available to the credit union in less than 8 days.