Fianna Fáil Finance Spokesperson Michael McGrath has said the Taoiseach needs to get some straight answers at today’s meeting with the country’s top bankers as to whether or not they intend to pass on last week’s ECB 0.25% interest rate decrease to customers.
Deputy McGrath stated, “Yesterday, the Taoiseach confirmed to the Dáil that the country’s top bankers will today attend the Government’s Economic Management Council. The Taoiseach needs to establish whether those banks who have yet to do so intend to pass on last week’s ECB interest rate reduction to mortgage-holders.
“In particular, the top brass of AIB and Bank of Ireland need to be held to account. These two banks owe their very survival to the extraordinary support extended to them by the Irish State. AIB is all but nationalised and the State has a 15% shareholding in Bank of Ireland. In response, they are dragging their feet on passing on last week’s interest rate cut to hard-pressed mortgage-holders.
“Last month the Financial Regulator Matthew Elderfield said he may seek additional powers to intervene on banks’ interest rate policy. Amazingly, the Taoiseach is waiting for Mr. Elderfield to knock on his door, rather than giving him the necessary powers which he could use at his discretion. Through his public comments, Mr. Elderfield was sending a clear signal to the legislature and this should be acted upon.
“In light of the Government inaction, Fianna Fáil will publish a bill which extends the necessary powers to the Financial Regulator to intervene, at his discretion, in the banks’ interest rate policy.
“Six weeks after receiving the Keane report, no Government decisions have been made on the recommendations of the report and no action whatsoever has been taken to assist distressed mortgage-holders. The Government is now taking a ‘hands off’ approach when it comes to the banks passing on the ECB rate cut. The only thing this Government has done for mortgage-holders is to break every promise it made to them.
“Variable-rate mortgages account for 30% of the Irish market, which corresponds to over 200,000 mortgages. Many mortgages holders are in difficulty meeting their repayments and this rate reduction and others will ease the burden on them.”