Co-op News September 2019: Agriculture

IRELAND
Why making
profits is a challenge
for Irish credit unions
– despite asset growth
Low interest rates and slow loan growth
stand in the way of profits in the Irish
credit union sector, despite record assets,
says the country’s Central Bank.
The report also points to consolidation
in the sector, resulting in fewer and larger
credit unions. There are now 246 – down
from 388 in 2014. Of these, 109 have less
than €40m (£36m) in assets and 55 have
at least €100m (£91.5m).
This is contributing to an average loan
to asset ratio of 28% – a historic low for
the sector, which is affecting income.
Total income for the sector was €293m
(£268m) in the six months to 31 March
2019, mostly from loan interest and
investment income. Expenses across the
industry were €218m (£200m).
In response, some credit unions have
been restricting deposits or increasing
lending, with the report indicating “an
increase in credit risk appetite”.
Credit unions face challenges “in the
context of a rapidly-evolving external
environment and in meeting member
expectations for choice, access and speed
of decision-making”, said Patrick Casey,
registrar of credit unions.
“Changes are required to the traditional
credit union business model to meet those
needs. The financial metrics presented in
the financial conditions report should be
considered in that context.”
Some credit unions are also exposed to
the risks of Brexit, with “42 community
credit unions with total assets of €1.98bn
(£1.8bn) and total membership of around
406,000 ... operating in the counties
along the border with Northern Ireland,”
said the report.
But it added that credit unions enjoy
a competitive difference, with a highly
respected brand, member loyalty and
a member-centric ethos.
Cuna Mutual gets experimental with fintech
Credit unions in the USA will be able
to test fintech solutions through a new
catalyst incubator. The initiative comes
from CMFG, a venture capital arm of sector
service organisation Cuna Mutual Group
and industry thinktank Filene Research
Institute. The FinTech Catalyst Incubator
will test fintech and insurtech products
aimed at helping credit unions grow.
Data breach prompts security offer at Desjardins
Canadian financial co-op Desjardins
is offering members protection against
identity theft, making it the first financial
institution in Canada to offer such
coverage to all members at no cost. In
June, Desjardins announced that an
unauthorised use of internal data by an
employee had led to the breach of personal
information of 2.7 million members.
Rwandan trade minister expresses support for co-ops
Rwanda’s trade and industry minister
Soraya Hakuziyaremye has paid visits
to three co-operatives in Kigali, praising
their transparent management and
sustainable growth. The minister,
on a fact-finding tour to learn what
co-operatives are doing and how the
government can support them, said they
showed that people could achieve more by
working together.
Gina Fusco new chair of ICMIF Intelligence Committee
Gina Fusco, director of strategy and
marketing at NFU Mutual, has been
elected chair of the Intelligence Committee
of the International Cooperative and
Mutual Insurance Federation (ICMIF).
A sub-committee of the board of directors,
the group is made up of global senior
executives from 24 member organisations.
Calgary Co-op scraps plastic bags at some stores
Filling stations and liquor stores run by
Calgary Co-op in Canada are replacing
plastic bags with compostable alternatives.
The move extends a commitment to
reducing plastic by the co-operative, which
saw it introduce the 10 cent compostable
bags to its grocery stores on 22 April
- Earth Day.
SEPTEMBER 2019 | 19