AUCKLAND, New Zealand – New Zealand is one of the most heavily regulated credit union industries in the world, but relief may be in sight. Dr. Michael Cullen, Minister of Finance, Minister of Revenue and Leader of the House, has promised to review the situation. Speaking at the New Zealand Association of Credit Union's (NZACU) annual conference recently, Dr. Cullen stated he wanted to amend the Friendly Societies and Credit Unions Act of 1982 which "will increase the ability of credit unions to grow within their common bond of members; remove the restrictions on the range of external sources from which credit unions may borrow; and provide a coherent supervisory regime by removing the perceived overlaps between the Securities and the Friendly Services Act." Cullen gave kudos to the credit union tradition and principles of being a self-help type of co-operative. He said the government shared the movement's vision of being "a credible participant in the financial services community, comprised of credit unions with robust corporate governance systems and staffed by individuals with relevant skills, training and resources; and responsive to both the social and financial needs of its local communities and members." Although Cullen's comments were good news for credit unions, NZACU CEO Doug McLaren told Credit Union Times reform could take up to four years. Certain parts of the review however, have been requested to be fast-tracked. Those include common bond and credit raising issues which are two of the most pressing limitations. To help move the review along, McLaren said, NZACU has a dedicated lobbyist in Wellington to promote the changes to politicians and government departments. Lucy Ito, Vice President of the World Council of Credit Unions (WOCCU) has been helping NZACU in its goal. She had the opportunity to sit down with McLaren, Dr. Cullen and Lianne Dalziel, Minister of Commerce. Ito, while she was in New Zealand and gave support to the ideas by appearing on the television "Breakfast Show," which is the New Zealand equivalent of the "Today" show McLaren is concerned that with an upcoming general election, a party change could set back the required legislative relief. The government recently sponsored a government bank to service the same population as credit unions service. The informal name is Jim's Bank nicknamed after the minister who proposed it. The official name is Kiwibank. McLaren said, "Jim's Bank has not had the impact on credit unions we at first feared it may have. There have been some losses quoted in the media for Jim's Bank. It is extremely difficult to know exactly how accurate these are, but suffice to say that it has suffered delays and difficulties, although it is becoming established. A very few credit union members have changed to Jim's Bank." McLaren believes the credit union industry can do more by emphasizing its strengths. He said that "Credit unions cannot compete with the giant financial services providers. Therefore our future must be in member service and value-added products." New legislation will help them. McLaren feels that what credit unions are looking for is primarily a level playing field. The leveling equipment is poised between Dr. Cullen's message, the lobbying efforts, and NZACU's determination. He remains optimistic that the end of the tunnel will be reached. -

[email protected]