Why is it taking the Central Bank so long to approve Frank to issue mortgages?

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newirishman

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Brendan Burgess said:
The Central Bank has delayed approving Frank as long as they possibly could. They have probably run out of excuses for not authorising them.

Brendan
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Do you have any proof of this, that they are deliberately delaying things? (Maybe worth a new thread)
 
newirishman said:
Do you have any proof of this, that they are deliberately delaying things? (Maybe worth a new thread)
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I would definitely second that suggestion.

If there is any evidence at all that the Central Bank is deliberately delaying an authorisation that is definitely something that should be brought to public attention.
 
No proof. But they have been sitting on it for some months and there is absolutely nothing involved in it. It's not a banking license. If they were serious about encouraging competition, they could have approved it within days of receiving it.

Brendan
 
Brendan Burgess said:
No proof. But they have been sitting on it for some months and there is absolutely nothing involved in it. It's not a banking license. If they were serious about encouraging competition, they could have approved it within days of receiving it.

Brendan
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Still wondering then why the crowd behind "The Frank Mortgages" doesn't kick up a fuss.
That would create instead free marketing along the lines "We want to give Ireland low interest rates, but the Central Bank prevents us from doing so by not giving us a license".
 
But Brendan, how do you know they have been sitting on the application for months?

For all we know, the Central Bank may have unresolved concerns about the fitness and probity of the applicant's principals or its policies for complying with the Bank's Codes. Who knows?

I don't think it's fair to input an improper motive to anybody without a firm basis in fact.

I take the point that this is not a deposit taking lender and, all things being equal, you would reasonably expect authorisation to issue within a matter of weeks rather than months.
 
Sarenco said:
But Brendan, how do you know they have been sitting on the application for months?
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I first heard about it in September I think. The application had gone in or was just about to go in.

Sarenco said:
For all we know, the Central Bank may have unresolved concerns about the fitness and probity of the applicant's principals or it's policies for complying with the Bank's Codes. Who knows?
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That is certainly possible. But it is far more likely that the CB is determined to keep mortgage rates high to maximise the profits of the lenders.


Sarenco said:
I don't think it's fair to input an improper motive to anybody without a firm basis in fact.
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Unfortunately, the CB will never release any such information. So we can never know the Central Bank's motives.

Of course, it could be their complete incompetence. They announced their enforcement investigation into ptsb almost a year ago, and nothing seems to have happened.

But the reality is that they have made many statements about competition and the reality is that when a genuine competitor appears, they do nothing to facilitate them.
 
Brendan

My point is simply that you have no firm factual basis for your assertion. Frankly, it's pure innuendo.

In my experience, the Central Bank can be an infuriatingly bureaucratic organisation. However, I would genuinely be stunned if the Bank was deliberately delaying any application to benefit incumbents in any market.

I agree that it's odd that the application is apparently taking so long to process but we really don't have any idea why that is the case. There could be any number of reasons for the delay. We just don't know.
 
Agree here that this is pure speculation, but obviously a level of 'logic' applied to it.

On one side, the CB is saying that the only way to solve the problem is competition but a new entrant is taking a perceptively long time to be established...

I do find it strange though that Frank would not be shouting if they were sitting waiting for something to happen on the CB side - cannot see if there is any activity on their twitter account as don't have an account myself
 
Sarenco said:
In my experience, the Central Bank can be an infuriatingly bureaucratic organisation.
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Agreed that it can be infuriatingly bureaucratic.

But Philip Lane and his predecessor have been banging on about the need for competition. If they were genuine about this, then he could simply cut through the bureaucracy and make sure that they were not delaying Frank.

Brendan
 
gnf_ireland said:
I do find it strange though that Frank would not be shouting if they were sitting waiting for something to happen
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I don't find that strange at all. The CB would probably deem such behaviour "unfit and improper". They are not in a position to publicly comment on the Central Bank.
 
I saw an article in the Indo about banks dropping rates before this new lender hits the market.

Any word in what is happening?

I assume it would be worth holding on for a few months before looking at a mortgage switch.

I am not the Frank mentioned :)
No bank of my own
 
Maybe its not the CB delaying but rather Frank themselves, its been no secret that there has been a political dislike for our current banks high mortgage interest rates and it could be Frank have delayed their application until after a government was formed and then waiting until the government decide what intervention if any they are going to do in the mater of high mortgage rates. This could be an issue that might cause Frank to review it decision to enter the Irish mortgage market.
Pure speculation, just another point of view that isn't anti CB.
 
They've had it on their site from a couple of months ago that they'd applied to the central bank. You'd imagine if that wasn't the case it'd be easy for somebody to find out that they were lying.

I don't think it's any conspiracy on the part of the central bank. I'd assume they have their process and it's as slow as hell.

I'm moving my mortgage at the moment to Ulster Bank. In dealing with them you'd think this was the first mortgage they've ever done. I'd imagine setting up a new bank would be a lot more time consuming.
 
Hi Cervelo

I understand that Frank is very keen to get going. They have now been waiting for over 6 months for the Central Bank to grant a license. That is during a time when the Central Bank has been claiming that it wants to see competition in the Irish market!

It's possible that the Central Bank delay may kill them off. Rates have fallen in the meantime, which makes their proposition less profitable. However, they were planning to lend at 2.8% so they would still attract a lot of business.

Brendan
 
Well having recently gone through the CB regulation process with another company, IMO central bank is very slow at giving its award of regulation. They kept coming back with changes, amendments to changes (not small either) before finally giving in. It took two years I would say all-in. Hence this Frank Money delay doesnt surprise me in slightest.
 
Hi username

I agree that the Central Bank is a bureaucratic nightmare.

However, they keep saying that competition is the solution. The Governor should have cut through all the delays and told his staff to expedite the license for Frank. It could have been done within a couple of weeks had they wanted to.

But it's simply not in their interest to do so. They don't want anyone highlighting the rip-off rates Irish lenders are charging.

Brendan
 
I agree with your theory, dont get me wrong, just giving my experience of them.
 
I suspect that the prospect of this Bill being passed will frighten them into finally pushing through Frank's license. They they can claim that they were right all along that a new entrant would bring down mortgage rates.

Brendan
 
"CYA" seems like the simplest explanation. Right now, there's one person asking "Why isn't Frank's application being fast expedited?".
Fast forward 5-7 years when NAMA2 is bailing out Frank along with the rest, everybody would be asking "Why was Frank's application fast tracked?".

It's a bit like going to the airport - pointless and arbitrary delays for security are an expected part of the theater.
 
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