Mortgage Interest Rates

Thursday, 28 February 2013

Questions (38)

Michael McGrath

Question:

38. Deputy Michael McGrath asked the Minister for Finance if, in view of the State support afforded to Allied Irish Bank to date, the spiralling mortgage arrears crisis and the link between high mortgage rates and the level of arrears, he will engage with AIB regarding its intention of increasing its standard variable rate for residential mortgage customers; and if he will make a statement on the matter. [10593/13]

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Written answers

Minister for Finance

The setting of rates is a commercial matter for the management and the Board of the Institutions. As the Deputy will be aware the Relationship Framework with the bank provide that the State will not intervene in the day-to-day operations of the bank or their management decisions. However I understand that the Central Bank of Ireland pays attention to such matters and would no doubt be concerned if banks were exacerbating their arrears problem and as such impairing their on-going viability, from such actions. These frameworks are published on the Department of Finance website at http://banking.finance.gov.ie/presentations-and-latest-documents/.