Dáil Éireann Debate, Thursday - 23 June 2016
27. Deputy Dessie Ellis asked the Minister for Finance if he will direct a bank (details supplied) and request that all other banks release information on the extent they have used or not used the 15% loan-to-value exceptions and 20% loan-to-income exceptions permissible under the Central Bank’s macro-prudential regulations; the reason they have not used the full leeway, where that is the case; and if he will make a statement on the matter. [17526/16]
View answerAs the Deputy is aware, the Central Bank's macro-prudential limits on mortgage lending came into effect on 9th February 2015. The policy sets restrictions on the loan-to-value (LTV) and Loan-to-Income (LTI) ratios on products that can be offered by mortgage providers. There are a number of exemptions allowed for within the CBI guidelines, for example, mortgage switchers or forbearance cases. The banks are at liberty to use these exceptions to the extent they see fit, and will likely do so with consideration to their risk appetite, lending policies and overall strategy.
As the deputy will understand, the macro-prudential limits on mortgage lending are designed, implemented and monitored by the Central Bank in its role as regulator of the Irish banking sector, and therefore fall outside of my remit as Minister for Finance. Moreover, the Central Bank does not currently provide prudential lending disclosures on an industry-wide or institutional basis and there is no regulatory requirement for any bank to publicly disclose the value of approved mortgages that are exceptions to the macro-prudential limits. My role as Minister of Finance, as set out in the Relationship Framework Agreements between the Minister and the banks in which the State is a shareholder, does not involve me in the relationship between the banks and their regulator. It would therefore be inappropriate, and beyond my remit, for me to direct the disclosure of the information sought by the Deputy.
However, I have received assurances from the banks in which the State has a shareholding that they have complied fully with Loan-to-Value (LTV) and Loan-to-Income (LTI) limits as set by the Central Bank during the year ending 31st December 2015, and that they continue to operate within the constraints set by their regulator.
As laid out in the Programme for Government, my Department will work with the Central Bank in the context of its up-coming review of the mortgage lending limits and my officials will write to the Central Bank to suggest that it would be helpful if the Central Bank could make available aggregated data on mortgage lending since the macro-prudential rules came into operation. This data, if available, would assist respondents in making evidence-based submissions to the Central Bank's consultation process.
