Pearse Doherty (Donegal South West, Sinn Fein)
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135. To ask the Minister for Finance if he will seek a social and economic impact assessment of the Central Bank of Ireland's new rules on mortgage lending; and if he will make a statement on the matter. [32860/15]

Michael Noonan (Limerick City, Fine Gael)
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The Central Bank of Ireland, having regard to its mandate to safeguard financial stability, has put in place new macro-prudential measures for residential mortgage lending effective from 9 February 2015.  These measures apply proportionate loan-to-value and loan-to-income limits to mortgage lending by regulated financial service providers in the Irish market.  The key objective of these regulations is to increase the resilience of the banking and household sectors to the property market and to reduce the risk of bank credit and house price spirals from developing in the future.  This is of particular significance for Ireland given that mortgage lending constitutes a large part of overall bank lending.  However, it should also be noted that these new macro prudential measures do not reduce the responsibility of lenders to appropriately assess applications for credit nor their requirement to act in the best interests of their customers.  

In its submission to the public consultation process undertaken by the Central Bank on its proposals last year, my Department recognised that there was a sound rationale for the introduction of macro-prudential measures in Ireland, but also indicated that it would also be appropriate to keep the particular measures as adopted under review from time to time.  While the Central Bank is independent in the setting of such macro prudential measures, this was a point that was recognised by the Bank and it indicated from the outset that it would monitor the impact of the implemented measures ongoing basis, in particular with regard to achieving the stated objectives of the measures and monitoring any unintended consequences.  While the macro prudential measures are currently in place for only a short period, I am informed by the Central Bank that this monitoring is on-going and that it will inform any future consideration and decisions in this area.  This will require an ongoing evaluation of relevant data and information, including the particular data on residential mortgage lending that lenders are required to submit to the Central Bank under these macro new prudential regulations.  Also, on a more general level, the Central Bank will also maintain a continuing research effort to evaluate macro prudential policy to help ensure its optimum deployment.