Central Bank pushing arrears problems with banks

Friday 01 February 2013 18.30
Patrick Honohan  says regulations on banks are being enforced with ''sizeable penalties''
Patrick Honohan says regulations on banks are being enforced with ''sizeable penalties''

The Governor of the Central Bank has said the central bank is imposing a "programme of required deliverables" on Irish banks to ensure they deal with the mortgage arrears problem.

Professor Patrick Honohan also said the bank continues to negotiate with the ECB to try and reduce the cost of the promissory note used to finance the losses at Anglo Irish Bank.

Introducing the TK Whitaker lecture this evening, the Governor said that regulations are being enforced with ''sizeable penalties'' imposed for violations.

''A graduated but intensive and unremitting programme of specific required deliverables is being imposed on the banks to try to ensure that they will deal effectively with the admittedly challenging task of getting ahead of the still-growing mortgage arrears problem, both by getting those who can back on schedule, and modifying loans in the case of those who cannot do so,'' he said in a speech.

''The bank is currently also playing its part in engaging with external partners in seeking to limit and smooth the impact on Irish balance sheets of the indebtedness accumulated as a result of the overly expansive decision to socialise banking losses, to help accelerate recovery of employment on a sustainable basis,'' he added.

Today is the 70th anniversary of the opening of the Central Bank of Ireland. The TK Whitaker Lecture "Design Flaws of the Euro" was delivered this evening by Harold James from Princeton University.