Government not selling 13,000 mortgage holders ‘down the Swanee’ - Taoiseach

Taoiseach Enda Kenny has rejected allegations that 13,000 families are being abandoned by the Government and "sold down the Swanee" in a row over the liquidation sale of Irish Nationwide mortgages.

Independent TD Stephen Donnelly claimed the Government was refusing to allow families bid for their mortgages but instead was selling the loans to foreign hedge funds.

Mr Kenny claimed Mr Donnelly had “jumped the gun”, and said the mortgages might not be sold to outside hedge funds if the valuations were not achieved and could go to Nama.

The row in the Dáil came as Fianna Fáil introduced legislation which would ensure mortgage holders would continue to have the “same vital statutory protections” if their loans were sold to an entity not regulated in Ireland.

Mr Kenny said buyers of two previous “packages” of mortgage portfolios accepted the Central Bank’s code of conduct in one case and voluntarily adhered to the code in the other.

'Cut no ice'
However, Fianna Fáil finance spokesman Michael McGrath, who introduced the protective legislation, said the Taoiseach's remarks "cut no ice".

Foreign financial institutions “may comply with the code for as long as it suits them, but when they decide not to comply with it any longer there is sweet damn all any mortgage holder can do about it”.

Mr Donnelly said he had repeatedly asked the Taoiseach to publish a report written by consultants PricewaterhouseCoopers and given to liquidator KPMG.

The Wicklow TD said the Taoiseach had indicated, based on the report, that families would not be allowed to bid for their mortgages. This was “an outrageous position”, describing it as “outsourced secret government”.

“I don’t remember anybody electing PwC or KPMG to make these kinds of decisions on behalf of Irish families.”

Mr Donnelly said Mr Kenny should instruct KPMG to pause the sales process and release the PwC report to the finance committee.

The Taoiseach said the sales date had been fixed but the loans could go to Nama if the valuation on the portfolio could not be achieved. A court would not allow repossessions unless the code of conduct was adhered to.

Mr Donnelly said the “Government is selling 13,000 families down the river based on a secret report from one group of consultants to another”. Those families “have the right to know why they are being abandoned by their own Government”.

Mr Kenny said "it's not true to say 13,000 families are being sold down the Swanee". If the mortgages were sold to outsiders there would be a "court observation" that the bid could not go through if the bidder did not adhere to codes of conduct.

Mortgage book
Introducing his Protection of Residential Mortgage Account Holders Bill, Mr McGrath said the Government was implying that if it forced outside bidders to provide the same protections to consumers they would pay the special liquidator less for the mortgage book.

“If they are prepared to pay more to be allowed to ignore these vital statutory protections, this is what they intend to do, with inevitable consequences for mortgage holders”.