Holly Cairns
Ceist:101. Deputy Holly Cairns asked the Minister for Finance if he will encourage banks to extend the moratorium on farmers repayments into the autumn in view of the ongoing impact of Covid-19. [9388/20]
Amharc ar fhreagraWednesday, 3 June 2020
Ceisteanna (101)
Freagraí scríofa
As the Deputy will be aware, An Taoiseach, Leo Varadkar T.D. and I, along with the Minister for Business, Enterprise & Innovation, Heather Humphreys T.D., met with the Chief Executives of the five Irish major retail banks earlier this month. Furthermore, the Minister for Agriculture, Food & the Marine, Michael Creed TD, has engaged the banks on the specific liquidity and financing needs of farmers, fishers and agrifood businesses.
I would urge anyone who may be worried about the impact of COVID-19 on their ability to repay their loans to make contact with their bank and discuss their options. Each of the banks have a wide range of supports available for customers impacted by COVID-19.
I welcome the ongoing work of the banks in helping business customers including farmers impacted by COVID-19, which included the initial three month payment-breaks that allowed their customers to defer some of their most significant outgoings. In April the members of the Banking and Payments Federation Ireland (BPFI) announced their intention to extend these payment breaks to six months for customers that require it.
The European Central Bank and the European Banking Authority have made a number of announcements recently, which set out regulatory flexibility to ensure that the banking sector can support their customers who experience repayment difficulty due to the COVID-19 Pandemic. In particular, the EBA has clarified that payment moratoria, such as the one adopted by the banking sector in Ireland, should not automatically result in the reclassification of borrowers who avail of the payment break. It is important to note that these payment breaks must be applied for by 30th June 2020 as this is the deadline set out by the European Banking Authority.
The Central Bank is focused on ensuring that extensions to COVID-19 related payment breaks operate in borrowers’ best interests and in line with regulatory requirements. The Central Bank has clearly communicated and agreed with the BPFI that it expects that at the end of the agreed payment break that borrowers who can return to full repayments be given, at the minimum, the option to either repay the loan within the remaining term or extend the term of the loan, without penalties noting that borrower circumstances and the appropriateness of each option may differ. These options may result in an increase in monthly repayments due to the overall increase in the cost of credit and this should be fully explained to the borrower. Borrowers can find more information on payment breaks at the Central Bank’s COVID–19 Hub.
Question No. 102 answered with Question No. 72.