2014-07-01
The Bank of Lithuania will submit proposals to legislators in regards to the strengthening of the credit union sector
The Bank of Lithuania’s expert working group summarised the responses from the stakeholders in a public discussion on the directions of the credit union sector reform and will present to legislators proposals on how to strengthen the sector. Most of those who responded agree with the proposals to strengthen the capital, management and internal control of credit unions.
“Taking into account the earlier proposals submitted by experts and the comments received during the public consultation, the Bank of Lithuania will cooperate with legislators and market participants and submit proposals on changes in the regulation of the credit union sector that will strengthen it”, says Marius Jurgilas, Member of the Board of the Bank of Lithuania, who is a member of the Working Group for the Preparation of a Conception for the Sustainable Operation of Credit Unions, formed under a proposal by the Republic of Lithuania Seimas Committee on Budget and Finance.
According to M. Jurgilas, the stakeholders actively participated in submitting answers to the issues raised during the public discussion. The Bank of Lithuania received answers from the Lithuanian Central Credit Union, the Association of Lithuanian Credit Union Members, the Association Lietuvos kreditas, the Republic of Lithuania Ministry of Finance, the Republic of Lithuania Ministry of the Economy, the State Enterprise Indėlių ir investicijų draudimas, the World Council of Credit Unions (WOCCU) as well as individual natural persons and credit unions.
Most respondents agreed with the problems identified by the Bank of Lithuania’s experts and basically agreed with the opinion that there is a need for changes in the activities and management of credit unions, seeking to ensure sustainable long term operation of the credit union sector. Almost all of the respondents also agreed with the proposal to strengthen the capital of credit unions, management and internal control of credit unions. The proposal on the founding of cooperative banks proved to be controversial, while the idea of variable-return deposits needs to be considered and analysed.
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The responses of stakeholders to the consultation document prepared by the Bank of Lithuania’s expert Working Group on the Strengthening of the Credit Union Sector (592.6 KB download icon) and the summary of the responses will be available on the Bank of Lithuania website.