Sinn Féin’s Finance Spokesperson Pearse Doherty TD has said the statement today from Bank of Ireland that it will veto any Personal Insolvency proposal involving a write-down of mortgage debt means the system is now fatally undermined and useless for many mortgage holders.
“Today Bank of Ireland’s CEO Richie Boucher told the Finance Committee in response to my questions that they will veto every Personal Insolvency proposal which includes a write-down on mortgage debt. On Tuesday Ulster Bank told the committee the same. The policies of these banks mean that the Personal Insolvency Act is now useless in its current form for many mortgage holders.
It comes as no surprise to Sinn Féin that, as we predicted, the banks’ veto on Personal insolvency Arrangements has fatally undermined the process. Minister Shatter must now look again at the whole process and urgently bring in the necessary changes to remove the banks’ veto.
The Personal Insolvency Act was much trumpeted as a sort of silver bullet for mortgage holders in difficulty. Earlier this month the Insolvency Service released very disappointing figures from its first few months. It showed that only four cases involving mortgage distress have been solved through the Insolvency system. To put that into context there are 96,474 homes in mortgage arrears over 90 days.
The Act is flawed and the banks have exploited that flaw. Minister Shatter has said he is keeping the Act under “close ongoing review”. If that is true he must now act to amend it to remove the banks’ veto.”