Róisín Shortall (Dublin North West, Labour)
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Question 40: To ask the Minister for Finance his views on the most recent statistics on private sector and consumer debt here and, in particular, on the newly emerging trend which sees declining outstanding mortgage debt as repayments outstrip new mortgage lending, the first time that such a trend has been in evidence since records began; and if he will make a statement on the matter. [27978/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The Deputy will be aware that the Irish economy is experiencing a profound economic adjustment. This is impacting in particular in the housing market and is demonstrated in certain Bank statistics referred to in the Deputy's question. A key issue is therefore, notwithstanding, the adverse economic environment the steps the Government is taking to ensure the availability of mortgage finance, in particular to first time buyers. The Deputy will recognise that it is essential that in view of the stresses on the banking sector that this form of credit is maintained to support our economic recovery.

As regards mortgage debt the Deputy will be aware that in December 2008 AIB and Bank of Ireland to provide an additional 30% capacity to first time buyers in 2009. They also committed to public campaigns to actively promote their lending to this sector.

These commitments were reconfirmed in the Government announcement on 11 February 2009 on the recapitalisation of Allied Irish Banks and the Bank of Ireland. Progress on implementing the commitments is to be made to the Financial Regulator every quarter. The first quarterly reports from the banks to the Financial Regulator report that they are "open for business "as evidenced by their promotional and advertising material.

The latest May 09 edition of the IBF/PWC Mortgage Market Profile provides a more granular picture of mortgage market conditions overall

·Net lending continues to grow - but at reduced levels

·First-time buyers (FTBs) increased, for the fourth successive quarter, their share of the overall market – albeit a smaller market. Their share by volume now stands at a record 21.4%, reflecting the relative resilience of this segment.

·Affordability continues to improve for FTBs through lower interest rates and house prices as well as for existing borrowers – with IBF calculating that the monthly repayment on an average loan has fallen by €479 or 38% since Sept '08.

The Profile showed that nearly 11,000 new mortgages to the value of some €2 billion were issued during the first quarter of 2009. While this shows that the rate of mortgage credit growth has eased significantly, at 4% the Irish market is still experiencing growth in net lending which contrasts with negative net lending in the UK, for example.