Professor Philip Lane:

I do not think it is a weakness of the CCMA. It is the nature of what a regulation can do as opposed to issues regarding the strategies of these banks versus non-banks and the menu of what they offer. What I was saying was that in the course of doing the CCMA review we did examine the data on what is going on with the loans of the non-banks versus the banks. We do not see this different trajectory where consumers with non-banks are systematically worse off. Deputy Doherty's supposition, as per our previous exchange, is that the long-term commitment of a bank to its brand here, or whatever, means it may be less severe with a debtor.

On the other hand, banks have high capital charges and also have to maintain their lending discipline into the future. The non-banks, however, have bought these mortgages at a discount and do not have the same capital charges. As Deputy Doherty stated, it is not obvious, in respect of these strategies, which group is going to be better off in the end. The Central Bank does data collection power and that is why we are stating we are going to return to this issue every year. Deputy Doherty has a strong hypothesis. I am not, however, convinced it is true.