Login Register
 °

Plan to save Cornish Community Banking "undermined" and "obstructed"

By WBMiles  |  Posted: February 18, 2013

Plans to save Cornish Community Banking were "obstructed" and "undermined".

Plans to save Cornish Community Banking were "obstructed" and "undermined".

Comments (6)

The plan to save a doomed community banking business in Cornwall was "undermined" and "obstructed" according to a group that tried to save the project.

Cornish Community Banking (CCB) announced on Friday that it was going into liquidation following a High Court order.

Members of CCB met last month and voted 59-4 for a vote of no confidence in the board as its financial situation worsened.

An action group was set up to try and save CCB but a spokesman for the group said the recovery plan had "the rug pulled" from under its feet.

Oliver Baines, chairman of the group, thanked CCB staff and said: "We find it hard to believe that a board could have acted with such extraordinary disregard for the members wishes, who had voted 59 to 4 in favour of the recovery plan only to have the rug pulled from under their feet."

Mr Baines said the recovery plan had the support of the membership and was being discussed with Cornwall Council and the FSA. 

He said: "What the Board will see as its success today we believe they will look back on with shame as they reflect on their actions.  They had every opportunity to talk to us, help us, and save the credit union.  Instead their actions undermined it, obstructed us and destroyed a great institution.  Beyond spite or incompetence, their motives are hard to fathom."

Insolvency practitioners from national accountancy firm Chantrey Vellacott DFK have been appointed liquidators of Cornwall and the Isles of Scilly Credit Union Limited – which traded as CCB.

It was owned and controlled by approximately 2,100 members with savings totalling around £550,000. 

Kevin Murphy from Chantrey Vellacott DFK stressed that all savers will be compensated in full under the Financial Services Compensation Scheme.

The liquidators will be writing to all members shortly enclosing a statement showing the balances on members' savings accounts together with the balances on any loan accounts. 

Read more from West Briton

Do you have something to say? Leave your comment here...

max 4000 characters

6 comments

  • kernowjon  |  February 19 2013, 10:42AM

    I would like to clear-up one point. Kernow Credit Union was asked if they would take on a "Transfer of Undertakings" from Cornwall and Isles of Scilly Credit Union. Given a choice we would have preferred to have seen 2 credit unions operating in Cornwall. However that was not to be. I would ask anyone who does not want to use a bank to give Kernow Credit Union a telephone call or visit the website to see what is on offer. Jon

    |   -9
  • TheGeofflane  |  February 18 2013, 5:15PM

    I am an 'incomer' and can assure Kernowjon I never said you were. At one point I got a letter implying CCB were to combine with you. Looks like a takeover and you're already touting for business. I trust no bank following a disastrous experience with the old Midland Bank when I learned we work for them, they do not work for you. I do hope my Sept. MOT doesn't cost too much. My grateful thanks to CCB. I now await a letter from the liquidator.

    |   4
  • TheGeofflane  |  February 18 2013, 5:01PM

    I was never in 'dire need', irmentrude, but with no capital (I won't bore you as to why), go in to Barclays, Santander and the rest for, say, £200 for a stove, MOT repairs or even a tax disc. What a performance and ritual humiliation. Last time I did that I was offered £3000plus over five years. No thank you. CCB kept me warm and my old 1991 car on the road and I'll be forever grateful. I saved £1 a week and paid back nine. I think you live in a different world from me, irmentrude. And Barclay's aint free. I pay £15 per month for their 'Additions' account. CCB for loans was invaluable.

    |   7
  • kernowjon  |  February 18 2013, 2:57PM

    Kernow Credit Union currently has 16 service points across Cornwall and hopes to open new ones soon. At present you can find the location of their nearest service point on their website. Really handy is the Saturday service point, at Pool Market. As Kernow operate on the traditional credit union ethos - the members soon build up savings. I cannot comment on whether the CCB model (with capacity loans),was ever viable, I only know the Board of Directors and the members of Kernow Credit Union all preferred to stick with the traditional model of credit union. I can assure "Geofflane", that Kernow Credit Union are not incomers, they are based in Redruth where they have been since 2004, before expansion they were called Kerrier & the Fal Credit Union. The new name was adopted when the Common Bond was changed to all Cornwall and the Scilly Isles. Anyone who formerly belonged to CCB is welcome to join Kernow Credit Union.

    |   -9
  • irmentrude  |  February 18 2013, 2:40PM

    As a former CCB member and volunteer, I feel that the Board only did what was necessary as Directors, however much the "Action Group" might deny it. Once its reserves were used up, CCB could not use members' money to make risky loans. CCB was sunk because the DWP model is fundamentally flawed. So many of its newer members did not share the credit union "all save so we can each borrow when in dire need" ethos and just wanted to use it as a free bank and get access to a loan whenever they wanted it. The ones who do share the ethos will be able to join Kernow CU and still get access to loans at a much better rate than doorstep lenders. If enough people do that, hopefully Kernow will soon be able to open branches in Truro/Penzance/St Austell to provide a convenient local service in those areas. If the DWP/government want those who are a poor risk to have access to cheaper credit, the DWP/government needs to provide the funds that are lent and bear the losses, not expect credit unions to do so. The Action Plan would have put members' money at risk and the new Directors might well then have been held personally liable for their actions.

    |   -12
  • TheGeofflane  |  February 18 2013, 1:51PM

    We use the superb facilities offered to us by CCB because we need them. I am currently repaying a small MOT loan. A pensioner with no savings left I wait to see what happens. If the good people who've helped me are out, I think a pound a week is all the incomers will get.

    |   12

      YOUR COMMENTS AWAITING MODERATION

       
       
       

      MORE NEWS HEADLINES