Response to report generally positive

REACTION:REACTION TO the Keane report was broadly positive yesterday, although a lobby group for mortgage holders accused the group of failing to engage with stakeholders.

The Irish Banking Federation (IBF) welcomed the report, saying that while existing forbearance measures provided critical support for borrowers, further measures would be necessary for those in an unsustainable solution.

“Member institutions will continue to work actively with distressed borrowers in determining appropriate solutions on a case-by-case basis,” it said.

Noting that it offered solutions for borrowers in “significant financial difficulty”, AIB, which is effectively owned by the State, said it would implement pilot programmes on some of the proposals contained in the report, describing the recommendations as a “comprehensive response to longer-term challenges”.

EBS said it was “supportive of the recommendations” and would make the range of options available to relevant customers as soon as possible.

However David Hall, businessman and co-founder of the New Beginnings group, which is lobbying for a balance of responsibility in mortgage debt solutions, was sharply critical.

“Nobody was approached. No organisation on the frontline of dealing with this was approached – Mabs, the Free Legal Advice centre, New Beginnings, none. There was no formal request . . . to contribute, to advise.”

At the IBF’s national conference yesterday, Martin Tuohey, of PwC in the US, said the decision not to introduce a blanket debt forgiveness scheme was consistent with the trend in other countries.

“Where introduced, it [debt forgiveness] has been done so in a very specialised way, in very specific cases,” he said.

The key intention of the report was to provide the lenders with a robust range of tools to deal with the current difficulties in the mortgage market as traditional strategies had become strained, he added.

Head of banking at the Department of Finance John Moran said the key to addressing the problem of distressed mortgage borrowers was to reform the bankruptcy laws.

The banks had “a heavy responsibility” to work with customers by developing “solutions that work for each individual customer”, Mr Moran told the conference.