Dáil Éireann Debate, Tuesday - 3 November 2020
441. Deputy Ged Nash asked the Minister for Finance his views on the recent reported comments (details supplied) by the ECB head of banking supervision regarding the payment breaks; his further views the need to return to the payment break arrangement prior to 1 October 2020 in view of the recent level 5 lockdown; his plans to meet the Central Bank and pillar banks to discuss this issue; and if he will make a statement on the matter. [33629/20]
View answerI note the comments made in the European Parliament recently by the Chair of the Supervisory Board of the European Central Bank.
I will continue to engage with the retail banks in light of any further guidance issued by the EU regulatory authorities to ensure that Irish borrowers can benefit from any further initiatives at an EU level.
In April the European Banking Authority (EBA) published guidelines which provided regulatory flexibility to banks who offered borrowers a temporary payment break due to COVID-19. These guidelines were originally applicable until 30 June 2020 and their application was subsequently extended to 30 September 2020. On the 21 September 2020 the EBA announced that there would not be a further extension to the guidelines. The EBA has made no further official announcements in relation to the extension or reintroduction of guidelines on payment breaks.
It is important to note that there is no regulatory impediment to lenders offering further payment breaks to borrowers. Lenders must however ensure that such a solution is appropriate for the individual borrower's circumstance.
Lenders are expected to work with borrowers who are still experiencing repayment difficulty at the end of a COVID-19 payment break in a pro-active and sympathetic manner and with the objective of assisting borrowers to meet their mortgage commitments. It is important to note that in line with the Code of Conduct on Mortgage Arrears (CCMA), lenders can offer borrowers a variety of options depending on a number of factors specific to their own circumstances.
The Central Bank recently stated that by early October, there were under 54,000 active payment breaks associated with Irish borrowers. It noted that 40% of active payment breaks for Irish borrowers relate to mortgages, which represents 3.4% of outstanding Irish mortgages.
I have had several meetings with the CEOs of our retail banks and with Banking and Payments Federation Ireland (BPFI). I met with them on 18 March, 11 May and more recently on 28 September, to discuss the issue of payment breaks. At my most recent meeting, the discussion focused on the options available to borrowers once payment breaks expire and at this meeting the banks committed to sympathetically engaging with borrowers who require on going assistance on a case by case basis.
