Mr. Brendan Burgess:

I will take up two of those issues. Mr. Kissane and Mr. Hall will take up the others.

The Deputy spoke about the price of corn flakes. I agree that the price paid by a fund for the debt it bought is not particularly relevant and is not an argument I would ever use, but if the committee manages to have the vulture funds appear before it, it should not let them use the argument that the Central Bank and the Department of Finance use on their behalf, that being, they increased the rates by 3% because they had a different funding model. These are two sides of the same coin. If the vulture funds are not going to tell you the price of the corn flakes, they should not say they have a different funding model. Imagine if we went across the road to Buswells Hotel after this meeting to have a pint of Guinness and Buswells told us it would cost €10, I said it only cost €6 when I was there the previous week, and then Buswells replied that it had been a family-owned business the previous week, it had since been bought out by a vulture fund and we had to pay up the €10. Do not let the vulture funds raise the issue of their funding model. It is not relevant. That a lender sold a mortgage or changed its source of funding is not relevant to the price someone is paying today.

The Deputy raised an interesting point about the need for vulture funds. There were significant levels of arrears in Ireland. As a result, the banks were zombie banks. The largest vulture fund of all was the National Asset Management Agency, NAMA. It bought the very bad big loans from the banks, which is what helped the banks get back on an even footing. It was necessary for them to get rid of home loans. We do not allow repossession in this country – we make that extremely difficult – so it was necessary to have vulture funds and to sell many of those loans. While we claimed that there were legal protections and, legally speaking, the same terms and conditions applied, the problem was that we did not protect people from interest gouging. I did not have a problem with vulture funds in the first place. Deputy Tóibín stated that it was part of a grand strategy. It was, and it was a good strategy.