Irish

Wednesday 20 August 2014

Targets to be set over mortgage arrears and lending to businesses

Fionnan Sheahan Political Editor

Published 27/02/2013 | 04:00

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THE big banks are setting specific targets for dealing with distressed mortgages and lending to businesses and housebuyers in a new deal with the Government.

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Meanwhile, the long-awaited report on pay packages in the banking sector is to be published in the next fortnight.

The Government is keen for the deal to be struck in line with the end of the bank guarantee.

The Central Bank is in negotiations with AIB, Bank of Ireland and Permanent TSB on their plans for dealing with lending to businesses and mortgage arrears.

Finance Minister Michael Noonan has confirmed that he expects the agreement to be finalised soon.

He said the banks would have to set out a "systematic planning regime" for dealing with a "set number of cases" of distressed mortgages each month.

Salaries

The report into pay for executives at bailed-out banks will be published in the next two weeks. The Government hired consultants Mercer to undertake the review of pay.

The review, which looked at pay scales at all levels in the so-called "covered banks" that benefit from explicit state support, including AIB, Bank of Ireland and IBRC (the now liquidated former Anglo Irish Bank), is complete.

The official €500,000 cap on annual pay for top bankers is currently widely breached, mainly because individual contracts predate the cap.

The timing of the review was driven in part because senior figures in the banking industry had complained to the Government that salary caps were barriers to hiring talent.

But any easing of the current pay cap will provoke an angry reaction among taxpayers.

Irish Independent

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