The European Network of Credit Unions (ENCU) wishes to thank the European Commission for the opportunity to
comment on the European Union’s implementation of the Basel III Net Stable Funding Ratio (NSFR) and its impact
on credit unions. ENCU represents more than 1,500 cooperative credit unions in Estonia, Ireland, FYR Macedonia,
the Netherlands, Poland, Romania, Ukraine and the United Kingdom with approximately €21 billion in total assets.
1 Our member credit unions serve over 7 million physical Europeans, many of whom are people of modest means
or small business owners.
Credit unions that invest in bank term deposits are indirectly impacted by the NSFR even though European credit
unions are generally exempt from the NSFR pursuant to Article 2(5) of the CRD IV.2 Early phase-in of the NSFR in
the Republic of Ireland significantly reduced the yields that Irish credit unions received on term deposit
investments—because the reserves required by the NSFR increased the banks’ effective cost of funds—even
though credit unions’ deposits in banks were sticky and stable during the financial crisis.

ENCU Credit Union NSFR to EC June 2016