Michael Creed (Cork North West, Fine Gael) | Oireachtas source

Retail and corporate deposits are a significant element of the bank's funding. Given the historically low levels of deposits, what is the flight risk? In other words, what is the risk given that people would say that only a marginal differential is available? It does not seem to me that anyone is chasing yield on deposits any more. The bank is actually losing money. Is Mr. Masding overstating the risk? Is the bank overpaying on deposits? In terms of the two issues, if the bank were in a position to pay significantly less for corporate or retail deposits, would there be a trade-off in terms of what the bank could charge its standard variable rate mortgage holder?

In terms of the constituents we meet, I would much prefer to meet someone who has money on deposit who is getting less than someone who is on a standard variable rate and in is danger of losing his or her house. It is a no-brainer. In terms of the mix of issues and cost of funds, if retail and corporate deposits are a significant part and given that, in banking terms, there is not really a lot of places for that fund to seek a home which has a significant return because most money on deposit is actually, in real terms, losing value, I would much prefer to see the bank cutting the rate it is paying to people who have money on deposit if it meant the bank could have a pro rata reduction in the standard variable rate.