CREDS 4
Shares and deposits
CREDS 4.1
Application and purpose
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Application
CREDS 4.1.1
See Notes
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Purpose
CREDS 4.1.2
See Notes
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CREDS 4.2
Shares
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Maximum shareholdings
CREDS 4.2.1
See Notes
A credit union must not permit a member to have or claim any interest in the shares of the credit union, other than deferred shares, exceeding the greater of:
- (1) £10,000; or
- (2) 1.5 per cent of the total non-deferred shares in the credit union.
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CREDS 4.2.2
See Notes
Where:
- (1) there is an increase in the percentage of the total non-deferred shares in the credit union held by a member; and
- (2) this is the result of a reduction in the total non-deferred shares in the credit union occurring after the time at which that member last acquired shares, or an interest in the shares, of the credit union, other than deferred shares;
that increase in the percentage of the total non-deferred shares in the credit union held by that member must be disregarded for the purposes of the limits in CREDS 4.2.1 R (2) and CREDS 4.2.5 R.
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CREDS 4.2.3
See Notes
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Joint accounts
CREDS 4.2.4
See Notes
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CREDS 4.2.5
See Notes
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Dividends on shares
CREDS 4.2.6
See Notes
A version 1 credit union must not:
- (1) pay different dividends on different accounts unless:
- (a) at the time of the payment of any dividends it has a capital-to-total assets ratio of at least 5%; and
- (b) the payment of any of those dividends does not reduce the capital-to-total assets ratio to below 5%; or
- (2) pay dividends out of interim profits more than once a year.
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CREDS 4.2.7
See Notes
A version 2 credit union is permitted to:
- (1) pay different dividends on different accounts; and
- (2) pay dividends out of interim profits more than once a year.
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CREDS 4.3
Deposits
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CREDS 4.3.1
See Notes
- (1) A credit union must not accept deposits except:
- (a) by way of subscription for its shares from persons who may lawfully be admitted to membership of the credit union under the Credit Unions Act 1979 and the rules of the credit union; or
- (b) from persons too young to be members under (2); or
- (c) as loans from persons under CREDS 3.3.1 R to CREDS 3.3.2 G.
- (2) A credit union must not accept deposits exceeding the greater of £10,000 or 1.5 per cent of the total non-deferred shares in the credit union from a person who is under the age at which, by virtue of any provision of the credit union's rules or otherwise, he may lawfully become a member of the credit union, unless the deposits are held in a CTF in which case the credit union may accept a larger deposit.
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CREDS 4.3.2
See Notes
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CREDS 4.3.3
See Notes
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CREDS 4.4
Insurance against fraud or other dishonesty
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CREDS 4.4.1
See Notes
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CREDS 4.4.2
See Notes
In order to comply with CREDS 4.4.1 R, a policy of insurance (subject to the exception in CREDS 4.4.3 R):
- (1) must insure the credit union in respect of every description of loss suffered or liability incurred by reason of the fraud or other dishonesty of any of its officers or employees;
- (2) must so insure the credit union up to the limits set out in CREDS 4 Annex 1 R in respect of any one claim, except that the liability of the insurer may be restricted to the amounts set out in CREDS 4 Annex 1 R in respect of the total of the claims made in any one year; and
- (3) must not provide, in relation to any claim, for any amount greater than one per cent of the limits on any one claim set out in CREDS 4 Annex 1 R to be met by the credit union.
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CREDS 4.4.3
See Notes
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CREDS 4.4.4
See Notes
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CREDS 4.4.5
See Notes
The tables in CREDS 4 Annex 1 R set out the minimum levels of insurance cover required by a credit union. It is prudent for a credit union to consider whether additional cover:
- (1) is needed for its own particular circumstances; and
- (2) should be obtained to cater for actual or projected growth in the "aggregate value" (see paragraph 1 of CREDS 4 Annex 1 R) between "relevant dates" (see paragraph 3 of CREDS 4 Annex 1 R).
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CREDS 4 Annex 1
Insurance against fraud or other dishonesty (see CREDS 4.4.1R)
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See Notes
Column (1) Aggregate value of share subscriptions and other deposits received and not repaid (the "aggregate value") |
Column (2) Cover required in respect of any one claim |
Column (3) Cover required in respect of total claims made in any one year |
|
Row (A) | Less than £10,000 | The higher of £500 or 50 per cent of the aggregate value | The higher of £1,000 or 100 per cent of the aggregate value |
Row (B) | £10,000 to £100,000 | The higher of £5,000 or 20 per cent of the aggregate value | 100 per cent of the aggregate value |
Row (C) | More than £100,000 | The higher of £20,000 or 15 per cent of the aggregate value | The higher of £100,000 or 75 per cent of the aggregate value |
Row (D) | More than £1,000,000 | £150,000 plus 5 per cent of the aggregate value over £1,000,000, subject to a maximum of £2,000,000 | £750,000 plus 5 per cent of the aggregate value over £1,000,000, subject to a maximum of £4,000,000 |
Notes:
|
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