AGM 2010 - Credit Control report

Credit Control report - Annual General meeting, 10th December, 2010

2010 has been a watershed year for Ireland. The economic news all year has been disappointing,

culminating with the unprecedented arrival of the IMF recently. The budget that was just announced

was also one of the harshest in living memory, and these factors combined have mirrored the

personal cirusmstances of many throughout the country.

Unemployment continues to rise with redundancies becoming an all too common feature of our

economic landscape, negatively impacting on the loan books of financial institutions, Kanturk

Credit Union included.

Consequently, credit control continues to be a crucially important area of our business and receives

considerable focus in the daily operation of Kanturk Credit Union Limited.

The Manager and staff are extremely pro-active in forensically evaluating all loan accounts

categorises as potentilly impacting on the bad debts of Kanturk Credit Union Limited. Under the

rules of the Irish League of Credit Unions, Resolution 49 requires that a provision is made for all

loans in excess of 9 weeks in arrears, and further, any loan, which has not had a principal

repayment within 52 weeks, must be written off. Rule 49 is applied to the letter of the law by

Kanturk Credit Union Limited.

In order to comply with Resolution 49, the Board of Directors has decided to write off €407,641 in

bad debts this year, compared with €231,888 in 2009. The increased write off is an indication of

changed economic circumstances. Furthermore, following the concept of prudence, the Board of

Directors have decided to increase the provision for bad debts in 2010 to €900,000.00, from

€600,000.00 in 2009. This course of prudent action was taken based on deteriorating economic

circumstances and the introduction of a revised Resolution 49 standard.

Loans that are "written off" are not however, ignored or forgotten. A significant number of loans

are with our Solicitors who are working through a process to recover our debt. Significant

resources are continuously expended in our efforts to recover all delinquent loans, and the

fruits of this labour is evident in this year's accounts as €138,595 of members money

was recovered.

Kanturk Credit Union Limited recognises that some of our members are experiencing

challenging financial circumstances. The management and staff of Kanturk Credit Union

Limited are here to assist and advise those members who are experiencing difficulties

with loan repayments. The board actively encourages all those who are experiencing

difficulty with loan repayments to make contact with Kanturk Credit Union Limited.

Ignoring this difficulty will note make it disappear. Contacting the Manager or any

member of staff could well be the first steip in finding a satisfactory solution

amenable to both parties.

I would like to ackowledge the vast majority of our members who honour their

agreements.

Finally, I would like to sincerely thank my committee, Manager and staff for their

enormous help and supprot throughout the year. Thank you.

Josh Kelleher - Chairman - Credit Control committee.