Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I thank the Ceann Comhairle for allowing me to raise this particular issue, and the Minister of State for coming into the House to address it. It relates to a meeting which the finance committee had with the Governor of the Central Bank of Ireland and his officials some time ago, wherein he shed some considerable light on the way lending agencies were expected to treat their customers. What is emerging now is a new and aggressive regime in respect of some impaired loans, some of which were in payment constantly and some of which were not, and some of which were affected by the health of the borrowers who were put out of business and unable to continue working. In some cases it is alleged that the borrowers never engaged. In these cases, the borrowers engaged all the time and repeatedly, and found it very difficult to engage. They found that they could be waiting for somebody to answer the phone for 20 minutes, half an hour or more, and maybe then the person was not there or there was a different person there.

What is happening now is that agencies have adopted a new and aggressive attitude, and they are pushing for repossession in a lot of the cases where there should have been a solution found to meet the needs of the borrower and the lender. That has not been done. I have to say that bringing it to the floor of the House is deliberate in order to alert the Minister of State to what is going on behind the scenes. We had the issue where there was a proposal to abolish ATMs throughout the country by one lending institution, and it was changed. What is actually happening is that is being done by stealth. Anybody who goes to cash machines anywhere now will find that every second one is out of order. It is the same attitude by stealth.

It is not acceptable. The same attitude can be seen in the number of times that borrowers are being contacted and the manner in which they are being contacted. The effect of the repeated emails and letters is to make every effort to intimidate the borrower into submission. There is a move towards repossession and into receivership in many cases. In a number of cases, really considered proposals were put forward but were either ignored or were put on the back burner and not mentioned at all. In both Pepper and Start Mortgages, these issues are being pushed in a way that has not been seen before. It is timely to bring to the attention of the House their activities and to impress upon all the lending agencies that the people of this country bailed them out in many cases, at great loss and hardship to themselves. A small bit of consideration for the people who bailed out the banking system could now be considered to be timely. Now is the time to do it because it is essential that we stand up for the people who stood up for this country and continue to work hard to stand up for it.

Neale Richmond (Dublin Rathdown, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I am very grateful to Deputy Durkan for raising this matter and bringing it to my attention and the attention of the line Ministers responsible. As the Deputy will know, the Government is acutely aware of the pressure that the rising interest rate environment may have on borrowers. In light of this, the Minister for Finance, Deputy Michael McGrath, convened a meeting with lenders that are active in the mortgage market on 31 August last. Representatives of the Central Bank of Ireland, the Insolvency Service of Ireland, the Citizens Information Board and the Money Advice & Budgeting Service, MABS, were in attendance. Following this meeting, on 6 September Banking and Payments Federation Ireland launched the second phase of its dealing with debt campaign to highlight new and existing supports available for mortgage customers.

One of the new initiatives to which the Minister and I would draw the Deputy's attention is the work between credit servicing firms and MABS on a streamlined customer engagement framework to accelerate the agreement of sustainable repayment plans for customers in financial difficulty. The consumer protection framework provides the same protections for borrowers regardless of the regulated entity with which they are dealing, be that a bank, retail credit firm or credit servicing firm. All of these regulated entities must be authorised and supervised by the Central Bank and are subject to the full suite of relevant regulatory requirements and financial services legislation, including the code of conduct on mortgage arrears, CCMA. A broad range of measures are in place to protect mortgage holders as part of this code of conduct, especially those who are experiencing difficulty with their repayments. The CCMA outlines how a lender must act if a borrower is in or is facing mortgage arrears. The CCMA sets out the process that entities must follow when a borrower is experiencing difficulties with their mortgage payments. Due regard must be given to the fact that each case is unique and needs to be considered on its own merits. Regulated entities must explore all of the options for alternative repayment arrangements, ARAs, in order to determine which arrangement, if any, is appropriate and sustainable for a distressed borrower’s individual circumstances.

The range of sustainable solutions being offered to consumers has expanded significantly, including the use of new ARAs, mortgage-to-rent arrangements and personal insolvency arrangements. The CCMA provides for an appeals mechanism, including where the entity declines to offer an ARA, where the borrower is not willing to enter into the ARA offered, or where the entity classifies the borrower as non-co-operating. Appeals can ultimately be referred to the Financial Services and Pensions Ombudsman. The CCMA must be complied with under the law. The Central Bank has the power to take enforcement action against any regulated entity that does not act in compliance with the CCMA. The Central Bank continues to supervise compliance with the CCMA and will investigate any issues that arise, including patterns of behaviour which suggest that the CCMA process is not being followed. Under the CCMA, the lender must contact the consumer about their mortgage arrears in a timely, clear, and consumer-friendly manner; get information from the consumer about their financial situation; assess whether a suitable ARA can be made; and resolve the case by offering an ARA or not doing so. The CCMA has been designed to protect consumers. Regulated lenders are legally obliged to comply with it. The CCMA requires lenders to provide dedicated and specially trained staff in their arrears support unit to manage cases. This includes having any meetings with consumers in private and referring them to their online or hard-copy information. Lenders must also follow the mortgage arrears resolution process, which sets out how lenders must communicate with consumers and assess their situation with the aim of coming to a resolution. It includes having an appeals process in place so consumers can appeal certain decisions of their lender. This is a robust framework that binds all regulated lenders. If the Deputy has evidence that firms are pursuing borrowers contrary to the provisions of the CCMA, the Central Bank of Ireland will consider any such information as part of its supervisory duties.

Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I thank the Minister of State. I accept the regulations that are in place do not always fit the situation. Invariably we come across situations from time to time in which a proposal is made to the lending agency based on the ability of the borrower to meet it. Invariably it is rejected and the borrower is told it is not sustainable. It is not sustainable for the lending agency, but it is sustainable for the borrower.

I would like to mention another issue. The lending institutions are taking full advantage of the housing crisis in this country by ejecting from their houses as many people as they can in the run-up to Christmas. Needless to say I am not surprised, but it should not and cannot be allowed to continue. I thank the Minister of State for his detailed reply but I suggest it is time to issue a warning of some description to the lending agencies instead of allowing them to treat our House of Parliament with contempt.

The situation regarding ATMs in Leinster House is another example of this. It was decided that not enough money was being made from them. During one of the lockdowns, it was decided to close them all down and take them away. This was in line with the banks' decision to phase out ATMs. The fact is that ATMs are a concession to the customer, of whom there are many in this House. It was short change on the part of the lending institutions to thumb their noses at the House of Parliament and that should not be allowed to go unchallenged.

I will raise this issue again. I am sure others will do likewise because it will emerge to a greater extent as time goes by. They will deny it, but the fact is that numerous proposals were made after careful study and a time-consuming process in order to resolve the problem to everybody's satisfaction at the time. They were all ignored.

Seán Ó Fearghaíl (Kildare South, Ceann Comhairle)
Link to this: Individually | In context | Oireachtas source

I thank Deputy Durkan. There is no doubt that his persistence knows no bounds.

Neale Richmond (Dublin Rathdown, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I share Deputy Durkan's frustration about the removal of the ATM from this campus. We both brought it up at a finance committee meeting over MS Teams when that was how we did committee meetings. Thankfully, those days are gone.

Bernard Durkan (Kildare North, Fine Gael)
Link to this: Individually | In context | Oireachtas source

They may come again.

Neale Richmond (Dublin Rathdown, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Regarding the matter raised by the Deputy, first and foremost the Government would encourage any person who has experienced a repayment difficulty or has any other genuine concern about their mortgage to contact their mortgage creditor to discuss the matter in the first instance. Of course, it is also essential that the Central Bank-regulated entities, irrespective of whether they are banks, retail credit firms or credit servicing firms, constructively engage with their borrowers to address any legitimate concerns raised and to act fairly in the interests of their customers. This is a warning from the Government. It should be followed up by the Central Bank, as the Deputy has requested. This is what lenders are required to do under the Central Bank consumer protection framework. It is the minimum standard that Central Bank-regulated firms are expected to comply with.

The Deputy will be interested to know that the Minister for Finance, Deputy Michael McGrath, has tasked officials to review the current mortgage arrears framework. An interdepartmental group has been established to review the framework. The mortgage arrears group comprises representatives form the Departments of Finance; Justice; Housing, Local Government and Heritage; and Social Protection. The focus of the group will be to consider the impact of the mortgage arrears framework and the current resolution options across the agencies and bodies, and to recommend refinements and improvements to better address the economic and social impact of mortgage arrears. The mortgage arrears group has commenced its work and will report on its review during the second quarter of 2024. I thank the Deputy again for bringing this matter to the House.