FF Central Bank Variable Rate Mortgages Bill 2016

sic transit

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The aim is simple, the purpose somewhat populist, to compel or encourage commercial banks to reduce mortgage interest rates via CB control. Noonan of course responded as one would expect in an attempt to fend off a bill the government cannot possibly defeat. While some of his claims on it may be exaggerated he does raise some key issues


The CB cannot be compelled to do anything no matter what legislation is enacted.
The CB is not involved in competition
The attraction of Irish banks for investment into the future may be reduced, with potential implications for the sale value of shares in it.

Government facing first legislative defeat of new Dáil

And the FF take on why they are reintroducing it.

https://www.fiannafail.ie/ff-mortgage-bill-will-tackle-high-mortgage-interest-rates-obrien/

Link to the original bill.

Central Bank (Variable Rate Mortgages) Bill 2015 [PMB] as initiated (in PDF format) - Tithe an Oireachtais

My view is that it is more about election promises, populism and the next election. I also wonder about the point of producing what, in effect, is little more than a motion.
 


HarshBuzz

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My view is that it is more about election promises, populism and the next election. I also wonder about the point of producing what, in effect, is little more than a motion.
Optics, plain and simple. FF\SF (see, it can and will happen) are playing to the gallery with some legislation that will make zero difference to people on SVRs but it looks good for Joe Public.
 

sic transit

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Optics, plain and simple. FF\SF (see, it can and will happen) are playing to the gallery with some legislation that will make zero difference to people on SVRs but it looks good for Joe Public.
Indeed and it could well set the bar for the type of legislation that might be proposed in this Dail. I don't see any upside whatsoever to this and there is also the potential effect on bank profits, which ultimately dictates how they set customer charges.
 

Jack O Neill

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The aim is simple, the purpose somewhat populist, to compel or encourage commercial banks to reduce mortgage interest rates via CB control. Noonan of course responded as one would expect in an attempt to fend off a bill the government cannot possibly defeat. While some of his claims on it may be exaggerated he does raise some key issues


The CB cannot be compelled to do anything no matter what legislation is enacted.
The CB is not involved in competition
The attraction of Irish banks for investment into the future may be reduced, with potential implications for the sale value of shares in it.

Government facing first legislative defeat of new Dáil

And the FF take on why they are reintroducing it.

https://www.fiannafail.ie/ff-mortgage-bill-will-tackle-high-mortgage-interest-rates-obrien/

Link to the original bill.

Central Bank (Variable Rate Mortgages) Bill 2015 [PMB] as initiated (in PDF format) - Tithe an Oireachtais

My view is that it is more about election promises, populism and the next election. I also wonder about the point of producing what, in effect, is little more than a motion.
Bank of Ireland in particular need bringing into line , but for the Irish people that pile of dung would no longer exist . The politicians or the cb wont change anything but the people can . We are left with very poor choices in banking in this country
 

sic transit

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Conor

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This is a particularly cynical and reckless piece of legislation. It'd be one thing if it were harmless, but having a law like this on the books (aside from its effect on the sale of AIB) will only deter competitor mortgage providers from entering the Irish market... How's that going to affect SVRs?
 

HarshBuzz

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Indeed and it could well set the bar for the type of legislation that might be proposed in this Dail. I don't see any upside whatsoever to this and there is also the potential effect on bank profits, which ultimately dictates how they set customer charges.
not forgetting that we own AIB, PTSB and EBS

if you're fattening these calves for market (as we are), introducing uncertainty around their revenue streams isn't the brightest idea
 

sic transit

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Bank of Ireland in particular need bringing into line , but for the Irish people that pile of dung would no longer exist . The politicians or the cb wont change anything but the people can . We are left with very poor choices in banking in this country
Seeing as everyone else did a runner, that's all we have. Personally don't think it's a good idea for politicians to meddle in things like banking. Giving the CB stronger oversight is one thing but politicians dictating bank policy has disaster written all over it.
 

Volatire

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These guys really are populist scum.

Last time out, FF blew up the economy by encouraging banks and investors to mis-price risk. Here they are at it again.

Interest rates are high in Ireland because the mortgage default rate is high.
 

Jack Walsh

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I despise FF but something has to be done.
Do people realise the sheer scale of the rip off?

Banks are charging mortgage holders 8 times what they are borrowing at.
EIGHT

Loan sharks in Tallaght operate on far lower multiples.

Even at 1% (the lowest estimate of the scale of overcharging compared to Eurozone averages) 300,000 households are being literally robbed of an average €2,000 per year, every year by these despicable gougers and all cheered on by Noonan.
Imagine what good an extra 2k a year into 300,000 (€600 million) Irish households could do instead of fattening bank profits

I have a mortgage with KBC and LTV of less than 50% and 25 year unblemished credit history with banks.
I pay 4.2%
A 25 year old could walk in and get 80% of a new property and his rate is 3.1%
On 500k I would end up paying KBC €100,000 more than him on a 20 year mortgage despite being a far better credit risk.
That is wrong and needs to be corrected.

As for Noonan, the man is contemptible.
12 months ago
Noonan warns banks failure to reduce variable rates will cost them dearly - Independent.ie

What did he do?
Nothing, sorry less than nothing as he actually went the other way (I assume on orders from his overlords in Brussels) and railed against each and every measure that might have brought banks in line.

He did everything to stop Willie Penrose's compassionate bankruptcy bill
He did the same to try to stop the bank veto on debt arrangements.
He is on record of saying debt forgiveness for ordinary punters cannot ever be considered

He is the poster boy for Europe, the go to man they can point to and rely on to come through for them every time the small guy has to be reamed.

Sorry, I have only just seen his comments that this move might harm bank share prices
The man is a disgrace.
 
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shiel

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The people who recklessly bankrupt the country and the people who want us to outdo Greece in recklessness are combining in this vote.

Not a word of condemnation from either media or academia.

Are we heading back to the recklessness of the celtic tiger with the same media and academic approval?

Are we what?
 

Jack Walsh

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Stop looking at the messenger and look at the issue.

Banks are overcharging customers on a biblical scale and FG have shown they have no interest in stopping it.
I support any person or party who tries to stop it irrespective of their past incompetence and worse.
 

HarshBuzz

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I have a mortgage with KBC and LTV of less than 50% and 25 year unblemished credit history with banks.
I pay 4.2%
A 25 year old could walk in and get 80% of a new property and his rate is 3.1%
you should switch
 

shiel

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Stop looking at the messenger and look at the issue.

Banks are overcharging customers on a biblical scale and FG have shown they have no interest in stopping it.
I support any person or party who tries to stop it irrespective of their past incompetence and worse.
Lets abolish the market.

Lets have a hospital at every crossroads.

Lets have free health, free electricity, free water, free transport.

Lets increase the salaries of the public service and the politicians to more than what it was in celtic tiger times.

Lets build a Shelbourne hotel for every druggie on our streets.

Lets subsidise the brothals and have free sex for all.

There is no end to what we want free.
 

Watcher2

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The aim is simple, the purpose somewhat populist, to compel or encourage commercial banks to reduce mortgage interest rates via CB control. Noonan of course responded as one would expect in an attempt to fend off a bill the government cannot possibly defeat. While some of his claims on it may be exaggerated he does raise some key issues


The CB cannot be compelled to do anything no matter what legislation is enacted.
The CB is not involved in competition
The attraction of Irish banks for investment into the future may be reduced, with potential implications for the sale value of shares in it.

Government facing first legislative defeat of new Dáil

And the FF take on why they are reintroducing it.

https://www.fiannafail.ie/ff-mortgage-bill-will-tackle-high-mortgage-interest-rates-obrien/

Link to the original bill.

Central Bank (Variable Rate Mortgages) Bill 2015 [PMB] as initiated (in PDF format) - Tithe an Oireachtais

My view is that it is more about election promises, populism and the next election. I also wonder about the point of producing what, in effect, is little more than a motion.
Of course its populist, but that does not mean it is not the right thing to do. And I don't believe for a minute that FF are doing it out of some empathy or compassion for the Irish people. They are not. This is about giving a bashing to FG, plain and simple.
 

gleeful

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Switching is expensive. It costs around 500-700 fees to the state (ie. tax) plus another 500 legal fees. Plus you need a new valuation (€180) It is only worth while if the interest rate difference is saving you more than 1500 a year.
 

Watcher2

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This is a particularly cynical and reckless piece of legislation. It'd be one thing if it were harmless, but having a law like this on the books (aside from its effect on the sale of AIB) will only deter competitor mortgage providers from entering the Irish market... How's that going to affect SVRs?
Indeed, because there was a flood of license applications to provide the full retail banking spectrum. All those banks will not now come. They will drop their applicatio......oh...wait:roll:
 

Watcher2

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Seeing as everyone else did a runner, that's all we have. Personally don't think it's a good idea for politicians to meddle in things like banking. Giving the CB stronger oversight is one thing but politicians dictating bank policy has disaster written all over it.
Looks like they are merely giving the CB the power to set policy. Does the CB have the power to force rates onto banks already, or cap rates? Whether this is good bad or indifferent, seems like the banks have brought this on themselves in the exhorbitant rates they are charging. And I'm a tracker holder so no vested interest in this. But again, its only giving power to the CB. It will be up to the CB to use it or not.
 


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