Central Bank's Honohan concerned about sale of mortgages to unregulated buyers
Patrick Honohan tells Finance Committee mortgages like those from IBRC is out of bank's control
The head of the Central Bank says he is concerned about the sale of mortgages by banks including IBRC to unregulated buyers that are not bound by the Code of Conduct for lenders.
The issue has hit the headlines as liquidators of IBRC agreed the sale of around half its mortgages to US private equity houses that are not regulated by the Central Bank.
“I am not pleased with this development,” Central Bank Governor Patrick Honohan told the Dail Finance Committee.
He was responding to a question from Fianna Fail finance spokesman Michael McGrath
When a bank sells mortgages to a non-regulated entity such as an investment fund the loan no longer falls under the regulation of the Central Bank.
“It is out of our control, we are not happy and have communicated that,” the Governor said.
Borrowers should not suffer as a result of their loan being sold, he said, and the regulator has called for work to be done.