The last three months have been the most difficult the Presbyterian Church has faced in a very long time, a meeting of its general board heard yesterday.
The Presbyterian Mutual Society, with which thousands of Presbyterians in Ireland have savings accounts, was placed in administration in November after a “run” on its funds saw 430 accounts closed and £21m wiped off its value.
There are almost 9,700 account holders in the society with no access to their funds.
Donald Watts, the church’s general secretary, told the general board of ministers and lay people: “Our concern above all must be for people who in good faith invested their savings in a society which seemed to be strong and providing a good return each year, only to find that their money had been locked up for a time and the ultimate return is unknown.”
“The Church cannot be separated from the people who are suffering most, because they are part of the Church.”
He said while membership was exclusively Presbyterian, the society was not accountable to the church’s general assembly. Members demanded an examination into the ethics of investments in property and by-to-let schemes by directors of the society.
The worth of its property portfolio is thought to have plunged from £129m to £92m.
Bob Allely, minister in Craigavon, said: “I was shocked when I saw the level of advances to property developers and buy-to-let.
“In my opinion the society was not set up for this. When did this change in policy come and when were shareholders advised?”
But Shaw Thompson, a minister at First Presbyterian in Dromara and a director of the society, said the PMS’s directors could not have foreseen the credit crunch.
“Were we to have had more foresight than Gordon Brown, than George Bush?” he asked. “None of us saw this crisis in global finances coming.”
Mr Thompson said he, his wife and two daughters had made “substantial” investments in the society.
The general board passed a number of resolutions which included a recognition of the “deep hurt” felt by investors and a call for an urgent meeting with the Prime Minister to extend the government’s guarantee scheme for savings of up to £50,000.
The resolution was echoed at the House of Commons, where DUP Junior Minister Jeffrey Donaldson tabled an Early Day Motion to raise the plight of PMS savers.
It calls for Mr Brown and Chancellor Alistair Darling to extend the same guarantees to mutual societies, as those who deposited money in Icelandic banks have had.
The motion states that the Commons “recognises that the society is now in administration due in the main part to the withdrawal of investments brought about by the introduction of a guarantee for the UK banking sector and notes that the government has provided assistance to UK investors in overseas banks”.
It goes on to “call on the Prime Minister and Chancell-or to extend that guarantee to provident and mutual societies, such as the Presbyterian Mutual Society”.