Dáil Éireann Debate, Wednesday - 10 December 2008
133 Deputy Bernard J. Durkan asked the Minister for Finance the extent of the undertakings received from the various lending institutions in return for Government support of the banking system; and if he will make a statement on the matter. [45555/08]
View answerUnder the terms of the Credit Institutions (Financial Support) Scheme 2008 (Scheme) each covered institution joins the Scheme by executing a Guarantee Acceptance Deed specified by me. I have held meetings with credit institutions covered by the Scheme in the last two weeks, and asked that they consider the contribution that they can make to the economy through appropriate credit initiatives in relation to small and medium sized businesses and otherwise. I have, therefore, welcomed the fact that certain institutions have announced or are considering initiatives in this regard.
A covered institution party to the Guarantee Acceptance Deed is required to comply with all the terms and conditions of the Scheme. For example, covered institutions shall submit such reports as are requested by the Regulatory Authority on my behalf which are considered necessary to monitor compliance with the terms and conditions of the Scheme and undertake to minimise any risk of recourse to the guarantee. They must comply with the Irish Bank Federation Code of Practice on Mortgage Arrears and the Consumer Protection Code issued by the Regulatory Authority, and appoint public interest directors approved by me. The full extent of their obligations are set out in the scheme.
Covered institutions as part of the acceptance deed also agree to:
pay quarterly charges as specified in the Guarantee Acceptance Deed;
indemnify me against any payments of covered liabilities by me following a claim made under the guarantee or any other liabilities incurred by me in that regard;
indemnify me in respect of any costs, claims, losses or liabilities incurred by me in connection with the provision of the financial support to the covered institution or a subsidiary;
comply with any directions or requirements given by me or on my behalf by the Regulatory Authority or Governor of the Central Bank;
co-operate with me, the Regulatory Authority or Governor of the Central Bank on all matters relating to and acts done or envisaged by the Scheme, objectives of the Scheme and the Credit Institutions (Financial Support) Act 2008.
