Revocation of licence of Vojenská družstevní záložna

The Czech National Bank has revoked the credit union licence of Vojenská družstevní záložna, due to persistent serious shortcomings in the activities of this credit union.

Vojenská družstevní záložna had long been unable to fulfil the statutory minimum capitalisation requirements. This was jeopardising its financial stability and the interests of its depositors. In addition, numerous problems had been identified, such as breaches of credit exposure limits and shortcomings in its control system.

As at the end of October 2010, Vojenská družstevní záložna had client deposits of CZK 137 million and total assets of around CZK 165 million. It accounted for 0.8% of total client deposits in the credit union market.

The last time the CNB revoked the licence of a credit union was in March 2010 in the case of Úvěrní družstvo PDW, Praha. This was also due to serious shortcomings in its activities.

At the end of the third quarter of 2010, the credit union sector as a whole had total assets exceeding CZK 18.4 billion. As of today, there are 14 licensed credit unions.

Tomáš Zimmermann
Communications Department