Up to 100 Credit Unions across the country are expected to participate in a house-building fund, worth €600 million, which is anticipated to deliver 10,000 new homes over the next 10 years.
CUDA (the Credit Union Development Association) first entered into a partnership with Initiative Ireland in August 2020 to establish a new fund that would lend to Approved Housing Bodies (AHBs), with the goal of supporting the delivery thousands of much needed affordable and social homes.
The fund has now received final approval from the Central Bank, enabling those credit unions that have committed to the strategy to now commence investment.
The new fund will enable credit unions from across Ireland to avail of regulatory changes which allow them to lend to Approved Housing Bodies through regulated funds.
Initiative Ireland, which specialises in funding social and affordable housing developments nationwide, will act as an investment advisor to the fund, sourcing and managing projects with Approved Housing Bodies.
CUDA, with membership of over 50 credit unions nationwide, which manage over €7 billion in assets, will support engagement with member and non-member credit unions as a sub-adviser to the fund distributor.
The expectation is that the fund could lend over €600 million to deliver over 1,000 new homes per annum.
Commenting on the announcement, Minister of State with responsibility for Financial Services and Credit Unions Sean Fleming said: “I would like to commend the partnership between Initiative Ireland and the Credit Union Development Association which will see the delivery of thousands of social and affordable homes by our Affordable Housing Bodies. Since I became a Minister, it has been a personal priority of mine to facilitate Credit Union investment in large scale social housing projects.”
Kevin Johnson, CEO of CUDA said: “CUDA and Irish Credit Unions have been working on this development for some time and we are not surprised by the huge interest amongst Credit Unions. As a result, the Fund will be open to all Credit Unions regardless of whether they are CUDA members or not.”