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ECB interest rate cut must be passed onto mortgage holders immediately

4 December, 2008 - by Caoimhghín Ó Caoláin TD

Sinn Féin Dáil leader Caoimhghín Ó Caoláin TD has called on the Government to ensure that banks and local authorities immediately pass on the full benefit of the cut in the European Central Bank interest rate to mortgage holders throughout the state.

Deputy Ó Caoláin said:

"Today's ¾% cut in the European Central Bank interest rate gives the Minister for Finance yet another opportunity to exercise his new-found influence over the Irish banks. He needs to act swiftly and use this influence to demand that the banks pass the benefit of this cut directly on to mortgage holders immediately.

"As we all know the banks never waste time increasing mortgage interest rates when the rate goes up and so should waste no time cutting them when the rate is once again brought down.

"The Minister for the Environment must also ensure that local authorities throughout the state also pass on the benefit of this interest rate cut directly to customers holding mortgages with them. Local authority house purchase borrowers are those on low incomes who could not access a mortgage through any of the commercial institutions. They are the people who most need to benefit from the decision of the ECB to drop the lending rate by three-quarters of one percent. The Government would have no credibility in calling on the commercial banks to drop their rates by the full decrease if, at the same time, it fails to ensure that the local authorities do the same." ENDS

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