I propose to take Questions Nos. 349, 350, 351, 352, 353, 356, 357, 358, 359 and 360 together.
The Central Bank of Ireland has an independent mandate to preserve and protect financial stability in Ireland. Its statutory responsibility for protecting financial stability and the regulation of the banking and financial sector includes the supervision and regulation of banks, retail credit firms, credit servicing firms and other regulated financial service providers.
It is important to note that the Central Bank of Ireland is independent from Government in the performance of its supervisory, regulatory and macro prudential functions.
The Central Bank of Ireland has a wide range of regulatory functions, and the powers to carry out those functions, as provided for in the Central Bank Acts, including the Central Bank Act (Supervision and Enforcement) Act 2013, other designated enactments, regulations and codes of practice. All regulated entities must comply with the relevant provisions of those enactments, regulations and codes, including in relation to the provision of credit and the operation of credit agreements.
Within the framework of the legislative and regulatory framework, retail banks, including any bank in which the State has a shareholding interest, are commercial entities and they operate and report on that basis. This includes matters relating to the processing of credit applications, decisions on whether or not to provide credit (and how much credit to provide), and the pricing of such credit.
The Central Bank of Ireland publishes a wide range of information and data on its website in relation to the banking and financial sectors.
The Financial Services and Pensions Ombudsman provides an independent, impartial, fair, confidential and free service to consumers of financial services to help resolve complaints. Consumers who have an issue must first raise it with their financial services provider. If they are not satisfied, they may then raise a complaint with the Financial Services and Pensions Ombudsman.
The Financial Services and Pensions Ombudsman has advised that it is not aware of receiving complaints in connection with the specific term of “hidden credit lines”. However, it should be noted that complaints can be couched in many different terms or cite different conducts.
A report on ‘Interest-Rate Swaps & Fixed-Rate Loans: Hidden Credit Lines’ was recently published by an organisation called ‘Bank Confidential’. This report raises a range of allegations primarily related to the sale of interest-rate swaps to small and medium enterprises in the United Kingdom.
According to the report, enterprises were availing of a financial product – an interest-rate swap – to fix the interest rate associated with variable rate loans. The issues raised include the enterprises not being fully appraised of the details of the financial product and the impact changing interest rates subsequently had.
The report refers to Ireland in several places, including the view that the allegations made in relation to the UK could also apply in Ireland and it also makes a number of observations in relation to the Oireachtas Banking Inquiry.
Consideration of any of the issues and allegations raised in this report, as they relate to the financial sector in Ireland, and any related interaction with regulated firms is a matter for the Central Bank of Ireland.
If any individual has specific information to suggest that a regulated firm is not complying with requirements under any aspect of the financial services legislative or regulatory framework, they should bring that information directly to the attention of the Central Bank of Ireland.
If a consumer is not satisfied with the way a regulated firm is dealing with them, or if it is not complying with the regulatory requirements, the consumer should make a formal complaint directly to the regulated firm in the first instance. If the consumer remains unsatisfied, they can then refer the complaint to the Financial Services and Pensions Ombudsman.
Finally, the Deputy may wish to note the contents of the published letter dated 3 November 2023 from the Central Bank to the Chairperson of the Joint Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach which can be found [here].
