As the Deputy is aware, last March the Banking and Payments Federation of Ireland (BPFI) announced a coordinated approach by banks and other lenders to help their customers who were economically impacted by the Covid-19 crisis. The measures included flexible loan repayment arrangements where needed, including loan payment breaks initially for a period up to three months and then subsequently extended for up to six months. The implementation of this voluntary moratorium by the banking industry was a flexible response to the emerging Covid-19 crisis and ensured that a large volume of affected customers could benefit quickly during a fast moving and evolving public health crisis.
While many borrowers whose payment break has ended have been able to return to full payments, it is also recognised that many borrowers continue to be impacted by the economic consequences of Covid-19 and that they may not be in a position to resume their loan repayment commitments when their payment break ends or may now be experiencing difficulty for the first time. These borrowers will continue to need, and will be expected to obtain, assistance and support from their lenders; this point has been made clear to lenders and has been accepted by them. Indeed in their recent 8 January statement, the BPFI reiterated that lenders were continuing to commit significant resources to those borrowers affected by the latest restrictions and that they are working with their customers to find solutions which meet individual circumstances. At this stage, rather than continuing with a general 'one size fits all' forbearance approach, it is considered that it is in the best long term interests of both the borrower and lender that engagement takes place in relation to a particular mortgage or other loan difficulty and that the most appropriate solution to the individual case - which can either be a short term or a long term restructure – is adopted as soon as possible. In such a context, the Central Bank has nevertheless confirmed that there is no regulatory impediment to lenders offering further payment breaks to borrowers, provided that they are appropriate for the individual borrower circumstance.
With regard to credit rating and records, it should be noted that lenders have an obligation to report information on all mortgage and other loans to the Central Credit Register. The Central Credit Register, which is under the remit of the Central Bank, does not produce credit ratings or credit scores. Rather the information on a credit report provided by the Central Credit Register is factual in nature; it contains no guidance, recommendation or prohibition for lenders on what decision they should make on an application for credit or repayment arrangements agreed with borrowers. Subject to complying with applicable law and regulatory requirements, it is a matter for lenders to make their own lending decisions in accordance with their own credit policies and risk appetites. The Deputy may wish to note that borrowers may access their credit report free of charge (subject to fair usage) at www.centralcreditregister.ie.
More generally, I will continue to work with the Central Bank, as regulator, to ensure that the Central Bank consumer protection and other applicable frameworks will be fully available to all borrowers that will still need support either arising from Covid-19 or otherwise.