Kieran O'Donnell (Fine Gael) | Oireachtas source

We have asked it to come in and I expect it to come in. Its representatives were in with us a little over two weeks ago and to be honest their answers were not up to par. We as a committee, a body representing the ordinary people, need to get answers. We need answers around a couple of areas.

We need a proper functioning banking system. We need proper competition in the banking system. We need Permanent TSB to be an active bank. The problem at present is that its balance sheet is in major trouble. That is a basic fact. Nearly one third of the loan book is non-performing. Permanent TSB's loan book is €21 billion but a third are non-performing loans. That is five or six times higher than the average. That is too high and must be addressed. That should have been addressed by the bank in the past ten years.

Real people are involved in these non-performing loans. Of the 18,000 mortgages on the books, some 14,000 are homes and the other 4,000 are buy-to-let properties. Most of the buy-to-let properties will have families living in them. They are an issue already. I very much welcome that the Minister of State said in his speech that the Minister will also convey to the bank the importance of removing those customers from the sale and that they may be suitable for mortgage-to-rent and those who have the potential to agree a sustainable restructuring in the coming months. I hope that the other mainstream banks such as AIB and Bank of Ireland are looking to purchase some of these mortgages as well.

The key point is that we have a bank that has major problems financially, completely absorbed in a high level of non-performing loans, while side by side, are real human beings with 18,000 non-performing mortgages. Some 14,000 homes are owner occupied. The remaining 4,000 mortgages are for buy-to-let properties, probably with families living in them. They are entitled to proper due process and rights. Our biggest problem for the public is the lack of absolute transparency and lack of information around this process. In how many cases are the clients not engaging with the bank? In how many cases have they split mortgages, warehousing, but they are deemed not to be fulfilling the criteria?

We need Permanent TSB to come before the finance committee and deal with the facts. I feel very strongly about that. There are new circumstances in the public domain relative to a number of years ago, when some of these loans were sold to the so-called vulture funds. That has to be reflected in the legislation. The vulture funds who buy loans can only operate in Ireland through an agent. That agent is regulated under the Consumer Protection (Regulation of Credit Servicing Firms) Act 2015. When the Central Bank of Ireland came before the finance committee last week, I asked a specific question about the regulation of these particular agents. I do not believe they are being properly regulated. What I was told is that the mainstream banks, such as AIB, Bank of Ireland or Permanent TSB, are heavily regulated by the Central Bank of Ireland. The personnel from the Central Bank of Ireland are out in their premises and doing audits. If I had a loan that was sold to a fund, the agent that operates that fund in Ireland would only have to undergo a desktop audit, because the personnel from the Central Bank do not physically go out to the premises. I think we need to ensure that the regulation should follow the loan, not the institution. If I had a mortgage with AIB and it goes to a fund, it should be the exact same form of regulation as if it had stayed in AIB and that would provide fairness in that area.

I welcome the fact that the Minister for Finance, Deputy Donohoe, is engaging and looking at how the regulation of credit services is working in practice. We cannot ignore the fact that Permanent TSB as an institution is in serious financial trouble. We cannot get over the fact that we must have competition and a third force in the market. However, people are entitled to fairness. We must ensure that the rights of the mortgage holder and the obligations of the institution from whom they got their mortgage before it was sold on, continue. In my view the Central Bank of Ireland is not enforcing the level of regulation it has over financial institutions that act as agents for vulture funds.We are being told it regards them as not being as material in this context as the mainstream banks. Regulation should follow the mortgage holder. We must ensure we keep people in their homes and rented properties and that we get absolute fairness. What is required is that we all work together to find a measure that will look after these 18,000 mortgage holders in Permanent TSB. There is a wider context to this with respect to the other funds. We need to ensure regulation moves with the times to ensure there is consistency in the way people's loans on their homes, and many people have loans on their businesses and farms with Ulster Bank and other banks, are regulated before they are sold on, and that the regulation follows the loan.