Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I welcome our guests and apologise for being late. I will pick up on the issue Deputy Pearse Doherty was teasing out. My instinct is that drawing a distinction between the service provider and the owner of a loan creates many issues and has the potential to dilute the thrust of the legislation. The Department of Finance's statement makes it clear that it has concluded that it would be better to insist that the credit servicer be regulated rather than the owner of the loan. I take the simple view that the original relationship is between the borrower and the lender, and that the lender, whether the original lender or somebody who steps into the shoes of the original lender, should be regulated and accountable to the State authorities for the application of the various statutory protections. Creating another layer through the service provider raises many issues, which could be cumbersome and bureaucratic in their application.

Inevitably, the relationship between the new owner of a loan - inevitably a private equity firm - and the service provider is a commercial relationship with a contract in place. If the Central Bank identifies a compliance issue with the CCMA which it wants to pursue, it can do so only under the legislation as proposed with the service provider. The service provider's relationship with the new mortgage owner could come to an end contractually. Although Mr. Crowley said there would be a seamless transition to a new service provider, why introduce the complexity? He asked why the owners of the loans should be regulated. If they want to own Irish mortgages, they should be regulated in Ireland. It would introduce a lot of complexity and it would appear that the industry has won the argument privately with the Department of Finance.