Dan Boyle (Cork South Central, Green Party)
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Question 141: To ask the Minister for Finance his views on the Central Bank's recent Financial Stability Report; and if he will make a statement on the matter. [32938/05]

Brian Cowen (Laois-Offaly, Fianna Fail)
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The central scenario underpinning the Central Bank's Financial Stability Report published on 1 November, is that the outlook for the economy is broadly favourable. In overall terms the report concludes, on the basis of a comprehensive and wide-ranging analysis, that the Irish banking system remains in a good state of health and is reasonably well placed to weather possible adverse changes in economic conditions.

A key finding of the report is that a range of fundamental factors such as growing employment and incomes, falling inflation and low interest rates have supported the pattern of mortgage growth and associated debt levels. The report does, however, highlight the continuation of strong mortgage credit growth as an important risk factor. It emphasises, therefore, the importance of responsible behaviour by both borrowers and lenders, to factor into their financial decision-making the prospective impact of potential changes in the future economic environment.

I share the Central Bank's assessment of the importance of maintaining financial and economic stability. In this regard, for my part I intend maintaining a responsible approach to maintaining stability in our public finances, which will ensure that the strategic direction of our economy will focus on sustainable real improvements in public services, social provision and infrastructure. In this context, I draw the Deputy's attention to Government debt levels, which are the second lowest in the euro area, as well as to Ireland's comparatively high levels of household savings rates, including SSIAs. My Department continues to monitor the effectiveness of the current legislative framework for the regulation of consumer credit by the financial regulator.