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

We asked the Central Bank to review the situation in the spring and it turned down the offer to become the authority that regulated interest rates. It thought this was a very bad idea and that competition in the market is the best controller of interest rates and the products offered. All the main lenders, AIB, Permanent TSB, Bank of Ireland and the others, made new offers after their meetings with me. Some of them reduced their rates by up to 20%, which is a significant reduction. We will not get the rates down to the European average, which the Deputy described, because the business in Ireland has come through a catastrophe and there are so many arrears on loan books on mortgages that the costs to the mortgage providers in Ireland are significantly higher because they are dealing with bad books. They are dealing with arrears, which is the key issue. I constantly monitor this and have regular meetings with the main banks and will continue to do so. It will be an agenda item for forthcoming meetings, as it was in the past. Significant progress has been made and the Deputy should encourage those who talk to him to avail of the new offers because there seems to be considerable reluctance to switch even when it is in the interest of customers.

The total figures are not as big as the Deputy says. The fixed mortgages are at very low interest rates. Some elderly or middle aged people have a very small balance left on their variable rate mortgages and do not think it is worth changing their relationship with their bank managers. There is a cohort of people adversely affected and I am addressing their needs.

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