Oireachtas Joint and Select Committees

Tuesday, 20 December 2016

Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach

Banking Sector in Ireland: Central Bank of Ireland

11:00 am

Photo of John McGuinnessJohn McGuinness (Carlow-Kilkenny, Fianna Fail) | Oireachtas source

I will take up a point Deputy Michael McGrath made. I hope we are not all beginning to buy into the narrative most of the banks are spinning, namely, that there have not been enough repossessions to impress upon banks that are not already represented here that there is security for their funds and that we need more repossessions to impress them. The representatives of the Bank of Ireland told us there would definitely be more repossessions in 2017 and onwards. Before the crash, there were very few repossessions. There were no headlines in the newspapers about the issue.

The banks condoned the borrowing that occurred. It was set up by professionals, solicitors, accountants and financial advisers, and individuals got loans. Now, we are focusing on the individuals' part of the wrong, their part of the story. I would like the Central Bank to ensure there are few or no repossessions and that they are worked out in some other way, the same way the Government gave the commercial world a break by way of NAMA, and they worked it out. This is a small country, and thousands of cases are coming down the track. Numerous families will be homeless and we have no take up of the housing.

Professor Lane said the Central Bank had a separate consumer protection directorate. The Central Bank should in some way set out for the banks that while the agenda to rebuild their balance sheets is going on, it should not be at the expense of those who are in mortgage arrears who can be saved. The banks are dumping cases into the courts in order to get rid of them and they have not exercised their full range of options with these individuals. It is better to dump them into the courts and get rid of them. A large number of banks, tracker mortgages and customers are affected, as Professor Lane said himself. From listening to this morning's exchanges, one would say there was almost a cartel in operation. They all did it.

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