Tuesday, 30 June 2020

Ceisteanna (55)

Charlie McConalogue


55. Deputy Charlie McConalogue asked the Minister for Finance the steps persons (details supplied) can take in relation to a mortgage; and if he will make a statement on the matter. [13241/20]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Finance)

As you will be aware both officials and myself have engaged and will continue to engage extensively with the Banking and Payments Federation (BPFI) and the banks directly in relation to supports for personal and business customers affected by the COVID-19 crisis. Officials in my Department are alert to issues raised directly by the public and these inform the Department’s ongoing engagement process and policy formation. 

The Wage Subsidy Scheme is one of the main tools with which we are protecting the income of employees who otherwise would not be working and it is hoped that it will be a major boost in saving the businesses for which they work. As of 18 June 551,800 employees have received a subsidy since the start of the Scheme, 232,400 employees received a subsidy in the previous week and an estimated 410,000 employees were being supported by the Scheme having received a subsidy in their most recent pay period.

Whilst I completely acknowledge the seriousness of the issue you have raised and its impact on those affected, what I cannot do is mandate how temporary payments received under the Wage Subsidy Scheme are treated in lending sustainability evaluations by regulators and lenders. 

The banking crisis we faced over ten years ago was fuelled by unsustainable lending. There are now thankfully far firmer regulatory controls and restrictions on lenders. Speaking on this particular issue, on 7 May the Governor of the Central Bank publicly noted that if an individual borrower’s circumstances have changed such that doubt is cast over the sustainability of potential borrowing, it is in the best interests of the borrower and the bank if the situation is reviewed.  

Furthermore as Minister for Finance I cannot mandate or overrule the internal risk assessment processes in any bank, even one in which the State has a shareholding. Decisions in this regard are the sole responsibility of the board and management of the banks which must be run on an independent and commercial basis. The independence of banks in which the state has a shareholding is protected by Relationship Frameworks which are legally binding documents that cannot be changed unilaterally. These frameworks, which are publicly available, were insisted upon by the European Commission to protect competition in the Irish market. 

Notwithstanding this, officials in the Department requested a comment from PTSB on how it is dealing with customer queries in relation to the matter raised by you and received the following response: 

“We have a duty of care to our customers to ensure that any lending is affordable for them. In accordance with consumer protection requirements, we are facilitating mortgage-approved customers on the TWSS in drawing down their loans subject to their employers providing assurance on the sustainability of their income when the TWSS comes to an end. We are doing everything we can to support our customers at this difficult time and are working with them on a case by case basis to assess their individual situations.”

In addition, the bank confirmed that it is happy to engage with any customer, in a confidential way, to address questions or concerns they might have.