Tom Fleming (Kerry South, Independent) | Oireachtas source

Billions of euro were spent to rescue the banks at the expense of the taxpayer in the period after the economic crash. Now the banks are recovering, but they are showing their ingratitude and demonstrating unethical behaviour towards customers. There is a fear and distrust among the general public regarding the banks and the manner in which they have treated financially vulnerable borrowers. Certainly, it has impacted significantly on public opinion, and there is now a backlash. The banks do not seem to be taking any notice of the negativity from the general public, however. Up to now, the banks have paid little or no heed to the Government. The continuation of inflated variable interest rates as well as the unfair burdening of lenders are inhibiting our economic recovery. Due to the banks ignoring Government approaches and the proposals within the Bill, there have been suggestions in Government circles that there might be rate reductions of 0.25%. This is a punitive and pathetic proposed decrease. It may get all mortgages under 4% before the end of 2015, but it is not an adequate target for the Government to have.

8 o’clock

Deposit rates are nil, allowing the banks to make a substantial 4% margin on all loans. The Central Bank has presided and allowed this disproportionate practice of the banks exploiting their clients over recent years. The European Central Bank interest rates are at an historically low level, with up to 300,000 Irish mortgage holders required to pay mortgage interest rates in respect of variable rate mortgages which are excessively high in comparison with the ECB interest rates. The practice of the banks using mortgage holders to supplement loss-making elements of the mortgage book will have to be halted due to undue hardship. It is also hampering consumer confidence and severely restricting consumer spending. It is about time at this stage considering the very softly-softly approach from the Government benches. In general, the Taoiseach, the Minister for Finance and the Cabinet have been playing a waiting game with maybe too much pleading and holding back to see will the banks make any substantial move. We are well aware that thus far the whole situation is dismal with practically no concession given. This approach is not working and decisive action will have to be taken. The Central Bank should be given the tangible necessary powers to force the banks to reduce the variable interest rates to a reasonable level and therefore I support this Bill.

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