Kieran O'Donnell (Fine Gael) | Oireachtas source

I thank the Minister of State for coming to the House. We had lengthy debates on Second and Committee Stages and many issues have been ironed out. The general thrust of the legislation is to look at making work pay, which is about reducing the USC. The Bill includes a range of other measures. The Minister of State has given a commitment he will review various aspects of the Bill over time. An issue that has been raised is with regard to regulation where vulture funds purchase home loans and small business loans. This may be outside the scope of the Finance Bill, but is relevant.

Last week, the Central Bank appeared before the finance committee and it has concerns about this area. Where a home loan or a small business loan is purchased by a vulture fund which does not operate in Ireland, regulation is under the auspices of an intermediary appointed by the vulture fund. There is concern that policy and interest rates are dictated by the vulture funds. Will the Minister of State examine how this operates in practice? The voluntary code was to apply to the funds. Will the Central Bank have sufficient teeth under the regulations to ensure home owners remain in the same position as they would have been if the loan had been held by the original Irish-based institution? We need to keep a very close eye on how this operates in practice. We cannot have a situation whereby home owners whose loans are sold to vulture funds are put under enormous pressure. When the Central Bank steps in to regulate the intermediary administering the loan it finds it does not have sufficient teeth to deal with it. People are being dealt with in different ways depending on whether they are with the original bank or the vulture fund.

Small business loans may also be sold to vulture funds by banks operating in Ireland. These small businesses suddenly find they are put to the pin of their collar. When the Central Bank steps in it finds it does not have sufficient teeth to deal with the situation. I ask that a review be carried out under the legislation introduced recently to govern how loans sold to vulture funds are regulated. If there is a need to do so, the Government should step in so that the Central Bank has sufficient powers to ensure that anyone whose loan is sold to a vulture fund by one of the principal banks is not put in a worse position.

This is a general observation on the regulation of foreign institutions, colloquially known as vulture funds, buying loans from Irish institutions.