Thursday 17 October 2019

Howlin lashes the banks for insolvency conduct

Brendan Howlin
Brendan Howlin

Niall O'Connor Political Correspondent

PUBLIC Expenditure Minister Brendan Howlin has become the latest senior Cabinet member to criticise mainstream banks over their conduct in personal insolvency cases.

Mr Howlin warned banks that they must engage with customers in arrears instead of pushing towards bankruptcy.

"Not all banks are engaging as they should, and that's not good enough from the Government's perspective," he said.

Mr Howlin's comments reflect a growing degree of frustration in government circles over the manner in which banks are engaging with the new insolvency regime.

Government sources last night said a number of options are being considered to tackle the arrears crisis, including a proposal backed unanimously by Labour to reduce the maximum bankruptcy term from three years to one.

Fine Gael ministers are also strongly in favour of appointing an independent panel of experts which would be tasked with reviewing decisions made by the banks.

The proposal, which would involve a panel making rulings on certain bank decisions, has also gathered support in Labour circles.

It is understood that changes to the mortgage-to-rent scheme - a government initiative which helps people at risk of losing their homes - are also being considered.

There is consideration being given to increasing the caps on properties that qualify for the scheme.

At present, Dublin properties must be bought for less than €220,000 and homes outside Dublin for less than €180,000 .

Sources say that these caps are set at too low of a rate and do not reflect the reality of property prices.

Speaking at an event in Dublin Castle yesterday, Mr Howlin weighed strongly in behind the proposal to reduce the period of bankruptcy, which was tabled by Longford/Westmeath TD Willie Penrose.

"I am very attracted to the bill published by my colleague Willie Penrose. The enactment of that piece of legislation would be a very significant new lever on the banks to engage rather than to push people into the area of bankruptcy," he said.

Irish Independent

Today's news headlines, directly to your inbox every morning.

Also in this section