Seán Fleming (Laois-Offaly, Fianna Fail)
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13. To ask the Minister for Finance his views on the very high level of arrears in the sub-prime mortgage sector; and if he will make a statement on the matter. [37064/14]

Michael Noonan (Limerick City, Fine Gael)
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The Central Bank has advised that there is no such regulated category as 'sub-prime' lender but that phrase is sometimes used to refer to some non-deposit taking 'retail credit firms'. Retail credit firms are a regulated category of entities which are authorised to provide credit (in the form of cash loans) directly to individuals. Some firms authorised in this category are mortgage lenders. Retail credit firms have been subject to regulation by the Central Bank since 1 February 2008. A register of all Retail Credit Firms is available on the Central Bank website.

The latest published Central Bank mortgage arrears and restructures statistics are to end June 2014 and show overall arrears and arrears greater than 90 days fell for the fourth and third consecutive quarter respectively.  At end-June 2014, there were 762,575 private residential mortgage accounts for principal dwellings held in the State, with some 90,343 principal dwelling houses in arrears of greater than 90 days, representing a decline in the greater than 90 days arrears category of 3 per cent over the quarter.  I am informed by the Central Bank that, at end-June 2014, six of these retail credit firms had a total of 17,986 principal dwelling house mortgage accounts of which 5,047 were classified as restructured. 

The Central Bank has informed me that the same consumer protection framework applies to retail credit lenders as to other regulated lenders including the Consumer Protection Code and the Code of Conduct on Mortgage Arrears. The CCMA sets out requirements for all mortgage lenders, including retail credit firms, dealing with borrowers in arrears or pre-arrears on a mortgage loan which is secured by their primary residence. It provides a strong consumer protection framework to ensure that borrowers struggling to keep up mortgage repayments are treated in a fair and transparent manner by their lender and that long term resolution is sought by lenders with each of their borrowers.  The Central Bank has advised that retail credit firms were also included in the scope of the Central Bank's recent review of the 'Implementation of the Revised CCMA' by mortgage lenders, the purpose of which was to ensure that mortgage lenders achieved full implementation of the requirements of the revised CCMA by end December 2013.

The Central Bank continues to engage with all mortgage lenders, including retail credit firms, in relation to lenders' mortgage arrears resolution strategies and approaches to dealing with borrowers in or facing arrears.  Early and effective engagement between borrowers and lenders is key to resolving cases of mortgage difficulty.  Where there is effective and meaningful engagement regarding a mortgage difficulty, an increasing number of durable long term mortgage restructures is being put in place.