15
June 2021

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Following due consideration and deliberation, the Board of Directors of Carnglen Credit Union Limited has reluctantly decided to introduce a monthly lodgement cap on shares of £500 per month per member, effective as of 1st May 2021. This decision was taken in the best interest of all members of the credit union and is intended as a temporary measure. This will be reviewed on a regular basis.

In recent years, Carnglen Credit Union has experienced a significant increase in the average level of savings held by individual members. We welcome this display of confidence by our members in our financial strength and commitment to the community. Carnglen continues to be a strong, safe and secure Credit Union.

However, due to the regulatory environment in which credit unions now operate under, there are downsides to such an increase in our savings. Under financial regulations, we must maintain reserves of 8%. Should our savings continue to increase at the current speed, we may find ourselves in a position where we will have to transfer surplus funds to the reserves to meet this requirement. In the event of having to do this, such transfers, can have the effect of reducing the amount available to pay a dividend at year end (please note there is never any guarantee of a dividend or a rebate being paid by the credit union and is always dependent on a number of internal and external factors).

Members will be aware that member’s savings which are not borrowed by other members are invested in the financial markets. Unfortunately, financial institutions are currently offering extremely low interest rates, with the possibility of some institutions moving to charging credit unions to hold savings.

To reduce the impact of this, the Board of Directors is trying to limit the growth in savings for the greater good of all our members and also encourages all our members and to consider Carnglen for your lending needs.

Thank you for your understanding in this matter.

Board of Directors Carnglen Credit Union Ltd

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