Aideen Hayden (Labour) | Oireachtas source

I wish to make one point about the sale of the INBS loan book. I congratulate Deputy Michael McGrath for introducing legislation to try to protect the interests of mortgage holders who have mortgages with the Irish Nationwide Building Society. It is important to remember that the latter company was the original sub-prime lender in this country and there is a serious impairment on that loan book. However, the proposed legislation will not be enough to protect mortgage holders with the INBS. Appearing before the Joint Committee on Finance, Public Expenditure and Reform, the liquidator said in defence of why they would not include compliance with the code of conduct on mortgage arrears as an essential part of the sale of the loan book, that it would impair the value they would get for the sale of that business. He also made the point that any prudent pursuer of the loan book would want the loans to be performed and therefore there was no real issue to address. The bottom line, however, is that there is absolutely no protection for those mortgage holders because that loan book is going to be sold off in bits and pieces. The most profitable bits of the loan book will clearly be the first to go. There is no follow-on protection for those mortgage holders when, not if, that loan book is sold on.

More important, there is no protection against increases in interest rates beyond what we would regard as normal for those mortgage holders. In this respect, changing the law is not enough. No domestic mortgage under State control, as the INBS loan book is, should be sold off at all. It should be transferred to NAMA and administered as such in future. With due respect to Deputy Michael McGrath, no real protection can be offered to those mortgage holders unless the mortgages remain within the control of the Government.