Commentary on Sections Section 3: Interest-bearing shares
This section permits a credit union to offer interest-bearing shares in addition to shares entitling the holder to a dividend.
Section 3(2) inserts new Articles 23A and 23B into the 1985 Order. Article 23A sets out the conditions which a credit union must satisfy before issuing interest-bearing shares. One of the conditions is that the credit union must have reserves of a certain level (the “threshold amount”). Article 23A(4) enables the Department to amend by order the threshold amount. Article 23B imposes duties on a credit union where interest-bearing shares have been issued, in relation to annual reporting and conversion of interest-bearing shares to non-interest-bearing shares.