Monday 22 July 2019

Vulture fund consent bill likely to fail amid claims of parties 'scuttling' it

 

Opposed: Paschal Donohoe told the committee the bill would hinder the operation of the mortgage market
Opposed: Paschal Donohoe told the committee the bill would hinder the operation of the mortgage market
Charlie Weston

Charlie Weston

Legislation that would force banks to secure permission from distressed mortgage holders to sell on their loans looks likely to fail.

The No Consent, No Sale Bill gives a veto to homeowners whose mortgages are being sold to a vulture fund.

Sinn Féin's Pearse Doherty is promoting the bill but has accused Fine Gael and Fianna Fáil of trying to "scuttle" it.

After protracted deliberations, the Oireachtas Finance Committee decided to recommend the bill in what is known as a scrutiny report that will now be laid before the Houses of the Oireachtas.

But the Finance Committee also agreed to a proposal to have an independent analysis carried out on the impact of the bill before it moves to its next phase in the legislative process.

The independent analysis is to be paid for by the Department of Finance.

Mr Doherty said it was unlikely the bill would now be passed unless there was a major change of heart in the Oireachtas.

Finance Minister Paschal Donohoe told the committee earlier this week the private members' bill will lead to higher interest rates and restrict banks lending money.

Mr Donohoe said that if the No Consent, No Sale Bill was to be passed by the Oireachtas it would result in reduced availability of mortgages.

He told the committee the bill would hinder the operation of the mortgage market.

The minister said the passing of the legislation would mean higher mortgage rates for customers, particularly those with variable rate mortgages.

He accused Mr Doherty of being reckless and promoting badly thought-out policy.

"We cannot ignore the very serious concerns expressed by my department, the Central Bank of Ireland and the European Central Bank in relation to this bill," he said.

Up to €10bn worth of distressed loans are set to be sold in the next few months by the likes of Ulster Bank. Vultures are expected to buy most of these.

The proposed bill is also opposed by the Central Bank, the European Central Bank and the Banking and Payments Federation. They have all argued the draft laws would hurt the financial system if enacted.

Speaking after a long private session of the Finance Committee yesterday, Mr Doherty said the move to have an independent analysis carried out on the impact of the bill would "kill it off".

"Let's call a spade a spade. Fine Gael and Fianna Fáil are using sweet words but they are trying to kill off the bill," he said after the private session.

He said it could be September or October before the analysis was carried out.

"We are in danger of running out of time because this Dáil will be finished before the bill is passed," he said, adding that Fine Gael had said it would vote against the No Consent, No Sale Bill.

Irish Independent

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