Written answers

Tuesday, 20 October 2020

Department of Finance

Covid-19 Pandemic Supports

Photo of Fergus O'DowdFergus O'Dowd (Louth, Fine Gael)
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192. To ask the Minister for Finance if further mortgage moratoriums will be supported for workers who are in forced closure lay-off, such as employees of restaurants without outdoor dining areas that cannot remain open under current guidelines; and if he will make a statement on the matter. [31071/20]

Photo of Paul MurphyPaul Murphy (Dublin South West, RISE)
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225. To ask the Minister for Finance if the banks and financial institutions will be instructed to suspend residential mortgage repayments for persons who request such suspensions for the duration of Covid-19 restrictions that are introduced by the Government which puts persons out of work and undercut their ability to pay; and if he will make a statement on the matter. [31473/20]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 192 and 225 together.

On 18 March last, the Banking and Payments Federation of Ireland (BPFI) announced a coordinated approach by banks and other lenders to help their customers who were economically impacted by the Covid-19 crisis. The measures included flexible loan repayment arrangements where needed, including loan payment breaks initially for a period up to three months and then subsequently extended for up to six months. This was a welcome initiative and it allowed necessary relief to be quickly and efficiently provided to borrowers.

Banks have now provided for flexible options for borrowers who can recommence payments following a Covid-19 payment break, and the BPFI has produced a useful guide on this - . The Central Bank has also updated its Covid-19 FAQ in relation to mortgage payment breaks on 18 September.

However, I am very conscious that many other borrowers, and particularly those who cannot return to work, continue to be impacted by the economic consequences of Covid-19, and that they may not be in a position to resume their loan repayment commitments when their payment break ends. I am fully aware of the stress and uncertainty that these borrowers are still facing, and they will continue need assistance and support from their lenders. As the Deputies know, the Tánaiste, the Minister for Public Expenditure and Reform and myself met the CEOs of the country’s retail banks and the Banking Payments Federation Ireland on 28 September to discuss this matter and we indicated that it is particularly vital that lenders work with their customers to ensure that suitable arrangements are put in place to assist their customers who are still experiencing difficulty. The lenders indicated that they will ensure that customers who have difficulties at the end of the payment break will be supported with a range of options so that a suitable arrangement can be agreed.

Borrowers have a suite of regulatory protections, such as the Central Bank's Code of Conduct on Mortgage Arrears, and lenders have specific obligations to support and work with borrowers who are continuing to experience mortgage or other loan difficulty because of Covid-19. These options could include additional flexibility, and this could be short term such as additional periods without payments or interest-only repayments, or if appropriate more long term arrangements. Each individual’s position is different and that’s why a case-by-case approach is now the best approach as some sectors of the economy are more impacted than others.

I will continue to work with the Central Bank, as regulator, to ensure that the Central Bank consumer protection framework will be fully available to mortgage and other borrowers that will still need support following a Covid-19 payment break.

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