Enda Kenny (Mayo, Fine Gael) | Oireachtas source

I am sure the Deputy understands the scale of the dysfunctionality that obtained in the banking system a very short time ago. I am sure he appreciates that the restructuring of the banks, involving a reduction from six banks to two pillar banks, the recapitalisation and other changes are important elements of putting in place a banking system that can actually function in the way the country needs. I would like to see Allied Irish Banks and Bank of Ireland operating as private banks doing what they should be able to do for every citizen, with proper systems, efficiency and competency. The fact of the matter is that the State has a share in Bank of Ireland and owns Allied Irish Banks.

The regulator, Mr. Elderfield, of the Central Bank of Ireland, has required the banks to submit to him their proposals to deal with distressed mortgages. This includes split mortgages, trade-down mortgages, the restructuring of mortgage payments and forbearance. As a consequence of their having to have made a submission by September, the banks are now required to implement their proposals. This means sitting down with those who are distressed, anxious and concerned and, in some cases, those who simply cannot meet the mortgage repayments to which they signed up with their banks in the first instance. That is the difficulty in many homes, daily and nightly. I and every other Deputy encounters it. This is why the structure is now in place for banks to be able to deliver on a range of solutions for those with distressed mortgages and who cannot pay, as distinct from those who can pay.

The Government introduced the insolvency legislation. It is being taken through the House by the Minister for Justice and Equality and it will become operational in March 2013. This will allow a different structure and approach for persons in the categories I have mentioned such that the problem will be sorted to their benefit.

It is not a case of the Government standing idly by while this matter boils away and creates even more problems. While it is a matter of major distress for our economy and a cause of a lack of consumer confidence, the process is now clear. The banks have had to submit to the Central Bank their options, which must now be implemented. In addition, the Government is moving on the insolvency legislation.

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