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

I thank the Deputy for his question. As he knows, I met with senior management of Ireland's six main mortgage providers in May. The meetings focused on the mortgage market and specifically the comparatively high standard variable rates currently being charged by the banks. I outlined my view that standard variable rates being charged in the Irish market are too high. There was agreement from all lenders that customers should have access to more competitive mortgage products as per my recommendation.

The banks agreed to review their rates and products and, by the beginning of July, to have simple options to reduce monthly mortgage payments for standard variable rate customers. Some of the potential products include lower standard variable rates for existing and new customers, competitive fixed-rate products and lower variable rates based on loan-to-value ratios for new and existing customers. In addition to the issue of interest rates, I also outlined the need for greater competition in the market and the need for a more active and well-resourced advertising campaign by the individual banks, focusing on promoting awareness of their best offering and how easy it is for customers to take up new products and switch between institutions if they wish to avail of better rates.

The position of homeowners who are in negative equity was also discussed, and assurances were sought and received that these homeowners will be able to avail of options to reduce their monthly repayments.

Officials in my Department will review progress over the coming weeks, and a follow-up set of meetings with each of the six banks will take place in September in advance of the budget. Time should now be allowed for the banks to act on this matter. However, it should be noted that the banks have started to make some welcome changes on this issue which should result in real savings for mortgage holders.

See this speech in context