ECB issues its opinion on giving CB power to control mortgage rates

"The ECB president also warned of potential conflicts of interest between the task expected of the Central Bank under the new Bill and the bank’s monetary policy and financial stability responsibilities."

Is this not the crux of the entire issue - Central Bank put financial stability responsibilities above its consumer interest ones?
 
Sarenco said:
Don't you think it's in consumers' interests to have solvent banks?
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Yes but not at all costs. If a bank (or any business) needs to extort customers to be profitable and solvent, then I do not believe they are good for the economy.

There is a price to pay for everything. Irish customers have already paid a very high price for solvent banks. There is absolutely no reason that the banks currently charge the interest rates they do on SVR's other than pure greed on their side.
 
In other words, it's absolutely fine for the authorities to control mortgage rates, but the Central Bank should not be involved in doing so.

Brendan
 
gnf_ireland said:
"The ECB president also warned of potential conflicts of interest between the task expected of the Central Bank under the new Bill and the bank’s monetary policy and financial stability responsibilities."

Is this not the crux of the entire issue - Central Bank put financial stability responsibilities above its consumer interest ones?
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There is a conflict of interest between the strategic objectives set by the Central Bank, particularly between its financial stability responsibilities and its consumer protection. My suggestion would be to separate the consumer protection function from the Central bank altogether and return it, in totality, to the Competition and Consumer Protection Commission as originally legislated for.
 
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Hi all I wrote this some time ago on my phone little did I think it would come to pass.

.......I cannot understand the continual erosion of a time sound basis of business namely the customer is always right to one now where the customer now is always wrong. The acceptance as a requirement by our lenders of time as the important ingredient as well as cheap capital, in order to restore their basis of being a pillar bank, but to then use the very opposite weapons, namely no time or cheaper rates to help their customers recover is wholly unfair that this has been allowed happen The cunning way it has been done to include our Central Bank and our Government as the perpetrators of this actions is unacceptable. It is clearly obvious to me that far from becoming pillar banks that will support our economy there is only one requirement for the heads of all lenders and that is to squeeze the customers to the very limit of what they can get away with because in the new financial world within Ireland the customer is always wrong.
Padraic
 
gnf_ireland said:
There is absolutely no reason that the banks currently charge the interest rates they do on SVR's other than pure greed on their side.
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Have you seen our default rates?!

They directly impact on the cost of capital and provisioning of our banks. As a result, our banks (most of which are State owned) are barely profitable.

If we want low rates, we have to let banks deal expeditiously with non-performing loans.

It really is that simple but we seem to want to have it both ways.
 
Toledo said:
What exactly did the Irish Government do when they spent billions bailing out the bank's,
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They didn't bail out the banks.

They bailed out the bond holders and the depositors in those banks. The shareholders lost virtually everything.
Brendan
 
Brendan Burgess said:
In other words, it's absolutely fine for the authorities to control mortgage rates, but the Central Bank should not be involved in doing so.

Brendan
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I presume you want this comment to be taken seriously not literally. (http://qz.com/824650/peter-thiel-wants-america-to-take-donald-trump-seriously-but-not-literally/)


However I think it is a perfectly reasonable statement, the key role of the Central Bank should be to support the health of the banking system, if this conflicts with the best interests of retail customers of the banks then the CB needs to support the health of the banking system.

That bank customers need some form of champion or authority is a different matter.

One organisation, in this case the CB, should not be given conflicting roles.
 
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