Catherine Murphy (Kildare North, Independent)
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36. To ask the Minister for Finance if he will indicate, in respect of mortgage loans which are passed from banks and other lending institutions to debt collection agencies, the extent to which those mortgages are protected under the code of conduct on mortgage arrears, specifically if both lender and debt collection agencies are based outside the State; if there is a regulatory gap in this area which needs to be addressed; and if he will make a statement on the matter. [16182/14]

Michael Noonan (Limerick City, Fine Gael)
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In circumstances where a regulated financial service provider outsources its debt collection activities, any agent acting on behalf of that regulated financial services provider must comply with the requirements of Irish financial services law, including the Code of Conduct on Mortgage Arrears. Failure to do so may result in the Central Bank imposing penalties on the regulated financial services provider concerned.

As the Deputy may be aware, the two purchasers of the IBRC residential mortgage loans, Loanstar and Oaktree, have both committed to servicing these books in accordance with the terms of the Central Bank's  Code of Conduct on Mortgage Arrears.

The Department's Legislative Programme includes the 'Sale of Loan Books to Unregulated Third Parties Bill', which will address concerns surrounding the continued applicability of the Code of Conduct on Mortgage Arrears after loan books are sold to unregulated entities.

In preparation for this legislation, my officials have been considering how best to ensure that the protections under the CCMA and other Codes continue to apply when a loan book is sold to an unregulated entity. The complexities of this issue have been discussed at meetings with the officials in the Central Bank and the Attorney General's office has been kept informed of progress.

Draft heads of legislation have been sent to the Central Bank for their consideration in advance of more detailed engagement with the Attorney General s office.