Share Cap FAQs
What is the shares cap?
A share cap is where a ceiling is put on the amount a member can save in their shares with their credit union.
From 01/03/2021 the credit union will have a share cap of €25,000 per member account. This means that each member can only have €25,000 in shares with the credit union. If anyone currently has over that amount in shares, they can leave their total balance in place but amounts above €25,000 will be transferred to Deposits and will earn no interest until further notice.
Why are you introducing a share cap?
The Board of Black Raven Credit Union took the difficult decision to introduce a share cap of €25,000 on shares in the credit union effective as of 01/03/2021.
This decision was taken in the best interests of all members of the credit union.
Factors considered included the following:
- The negative interest rates being charged by banks on deposits lodged by credit unions.
- The lack of returns on investments.
- The fall in loan demand due to the COVID 19 Pandemic.
- There has been a significant increase in the number of deposits made at the credit union primarily due to the effects of COVID-19 on the economic environment.
- Under Central Bank regulations, we must maintain our statutory capital (Regulatory Reserve) at a minimum of 10% of our Total Assets. In practical terms this means that for every €100,000 of savings, we must allocate €10,000 from our surplus/profits to the Regulatory Reserve.
- While Black Raven has a very strong capital position the Board of Directors wish to ensure this strong position is maintained.
When is it being introduced?
The share cap comes into effect on 1st March 2021.
How many members will this affect?
This will affect all Members who have in excess of €25,000 in their accounts.
What about members with savings under €25,000?
Members with less than €25,000 can increase their shares to €25,000, but to no more than that amount. Staff will be tracking this to identify members that are reaching the limit and the member will be advised accordingly. Any amounts above €25,000 will be transferred to a Deposit scheme in the member’s account.
What about members with savings above €25,000?
If a member has more than €25,000 in savings the excess savings will be transferred to a Deposit Scheme in their account. The Shares and Deposits are withdrawable on demand and members are encouraged to shop around for suitable savings returns.
How long will the cap last for?
The Board of Black Raven Credit Union will keep the share cap under constant review, if they make any decision to change the current cap, members will be informed.
Does this mean the credit union is in difficulty?
No, this has no bearing on the day-to-day operations of the credit union. Black Raven Credit Union has a very strong capital position, and the Board of Directors wish to ensure this strong position is maintained.
Are my savings safe here?
We can assure you that your savings remain safe and secure at Black Raven Credit Union.
In addition, your savings continue to be guaranteed by the Government Deposit Guarantee Scheme up to €100,000.
The Depositor Information Sheet can be found on our Downloads section.
Does this mean the credit union cannot give out loans?
Black Raven Credit Union is in a strong position to provide loans, subject to appropriate assessments being completed. Our ability to lend is in no way affected by the share cap. We continue to provide a prompt efficient loan service to our members. We welcome all loan enquiries.
Will you be contacting those affected?
Yes. A letter has been posted to all members affected to inform them of the change and advise them of any necessary options available.
I am affected by the share cap of €25,000, what will I do now?
You will have received a letter from the credit union advising you of your options. We would encourage you to withdraw funds to bring them below the €25,000 cap. Should you wish to organise a share withdrawal direct to your bank and require assistance you can contact us at 01-4610682 where a member of staff will be happy to assist. We offer the facility to transfer funds direct to your bank account using online services and our app. This is a secure, efficient and very convenient service. We cannot offer financial advice to members on investment or other savings options. You are recommended to talk to your financial advisor.
I have received a letter advising me I am nearing the share cap. How will this affect me?
Members who reach €25,000 in shares will be prevented from making further lodgements to shares until the balance on their account falls below €25,000. (Please take note of your current balance and ensure that it does not exceed the €25,000 limit on savings). Amounts above €25,000 transfer to Deposits.
Statements of Account
These are available 24/7 online or by request. If you do not wish to use online services, please email firstname.lastname@example.org or call 01 4610682 and we will arrange to send a statement to your home address.