Michael McGrath (Cork South Central, Fianna Fail)
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58. To ask the Minister for Finance his views on whether it would be beneficial for the economy if the banks passed on the ECB interest rate reduction; and if he will make a statement on the matter. [48781/13]

Michael Noonan (Limerick City, Fine Gael)
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Macroeconomic simulations published at the time of the Budget suggest that a lower-than-expected interest rate environment would be likely to result in greater-than-forecast growth in economic activity and employment. I, as Minister for Finance, have no statutory role in relation to the mortgage interest rates charged by regulated financial institutions. It is a commercial matter for the banks concerned.

This interest rate is determined taking into account a broad range of factors, including European Central Bank base rates, deposit rates, market funding costs, the competitive environment and an institution’s overall funding.