Central Bank chief bottles it on home loan overcharging
Bank Inquiry says weak regulators failed to act in crash
Published 27/01/2016 | 02:30
The new head of the Central Bank says he is powerless to force banks to cut variable rate mortgages.
But Central Bank Governor Prof Philip Lane was told at a Dáil committee he needed to tackle the banks' "unjustifiable" rates, as ECB interest rate reductions are not being passed on to homeowners.
Prof Lane said he understood it appeared unfair, but interfering between the banks and customers was "not really within our power".
The debate about the Central Bank's role comes ahead of the publication of the Banking Inquiry final report today. The report concludes banks were able to breach spending limits on property deals without fear of consequences from the Financial Regulator or Central Bank during the boom years.
The regulators are sharply criticised for failing to use their powers to intervene as the property market overheated and eventually collapsed.
The report finds both institutions had sufficient power to identify risks and implement regulations, which could have lessened the impact of the crash.
Meanwhile, a new report by the EU Court of Auditors has found the European Central Bank's refusal to let Ireland burn senior bondholders was never explained to authorities in Brussels.