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Central Bank of Ireland

Dáil Éireann Debate, Wednesday - 18 May 2016

Wednesday, 18 May 2016

Ceisteanna (17)

Mattie McGrath

Ceist:

17. Deputy Mattie McGrath asked the Minister for Finance the efforts to place the Central Bank's code of conduct on a statutory footing; and if he will make a statement on the matter. [10200/16]

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Freagraí scríofa

The Central Bank's Code of Conduct on Mortgage Arrears (CCMA) provides a strong consumer protection framework to ensure that each borrower who is experiencing genuine difficulty in meeting the repayments on a mortgage secured on a primary home is treated in a timely, transparent and fair manner by lenders.  The CCMA recognises that it is in the interests of borrowers and lenders to address financial difficulties as speedily, effectively and sympathetically as circumstances allow. 

The CCMA applies to all regulated mortgage lenders operating in the State when dealing with borrowers facing, or in, arrears on a mortgage which is secured on a primary residence. Furthermore, the Consumer Protection (Regulation of Credit Servicing Firms) Act 2015 now provides for the regulation of credit servicing firms and accordingly the CCMA also applies to such firms who are servicing primary home mortgages held by non-regulated entities. An addendum to the CCMA was published during 2015 to reflect this fact.

The CCMA was issued by the Central Bank pursuant to the provisions of Section 117 of the Central Bank Act 1989 and regulated entities are required to comply with the provisions of the Code as a matter of law. The CCMA is therefore issued under statute and, as stated by the Supreme Court, it forms part of the law. The Central Bank has the power to administer sanctions for a contravention of this Code, under Part IIIC of the Central Bank Act 1942.

As recognised by the Programme for Government it is important to keep the provisions of the Code, and indeed the wider statutory framework for the protection of consumers of financial services, under review to ensure they remain appropriate to the evolving position of the mortgage market. As the Deputy is aware the Code has already been reviewed and updated over time and the Government will continue to liaise and work with the Central Bank to ensure that the CCMA continues to be monitored and further updated as necessary in a way that is fair to the legitimate interests of debtors and creditors and, taking account also of appropriate wider public policy considerations, that sustainable solutions will be available to address genuine mortgage difficulty.

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