Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

As I have said repeatedly, there is a signed agreement between the previous Government and the banks, which we intend to honour, to the effect that there will be no interference with the commercial decisions of any of the banks in which the State has a shareholding or in any other bank. The Deputy would not thank me if I were the type of Minister who would interfere with private commercial decisions of the banks or try to use any leverage as the Minister for Finance to influence the banks one way or another on behalf of particular clients. We cannot run a country in that way. We have seen examples of that previously and in other countries and we are not going there.

What I want to do with the banks is continue to make them profitable. The decision taken this week to abolish the bank guarantee means that the banks will no longer have to pay the levy they were required to pay for the use of the guarantee and that will increase their profitability by approximately €1 billion throughout the sector. That will put the banks in a better position to give a better service to people. However, decisions on how the banks apply their new-found profitability is a matter for them.

AIB is at the lower end of mortgage lending. It was well off the pace previously and was losing money on practically every mortgage it wrote.

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