Banks that refuse to pass on the European Central Bank interest rate reduction to mortgage holders should “reconsider their position” or face the possibility of legislation forcing them to do so, Tánaiste Eamon Gilmore has said.
Speaking in the Dáil today, he told Fianna Fáil deputy leader Eamon Ó Cuív that he and Taoiseach Enda Kenny had made their views on the interest rate reduction "very clear" to AIB, Bank of Ireland and the Ulster Bank at a meeting yesterday.
Mr Ó Cuív had pressed the Tanaiste about the issue and also called for the Government to cut the wages salaries of bankers in financial institutions owned by the State. "You should not pay more than public service rates to people who are public servants," he said
The ECB last week cut its key interest rate by 0.25 per cent to 1.25 per cent.
Mr Gilmore replied: "We are going to take this one step at a time. This is not about words. The Government is acting on this."
Mr Ó Cuív pressed him again. "Are you going to enforce it" he asked of the interest rate reduction.
That's step number two," said Mr Gilmore.
He said that if the banks "do not reconsider their position", the Government "will take action as appropriate".
The Tánaiste said the Taoiseach met financial regulator Matthew Elderfield yesterday and asked him to assess the issue. They awaited that response.
Sinn Féin TD CaoimhghínÓ Caolaín claimed the Government's reaction was "pathetic" and suggested that the Government already had an indication of what was necessary.
Mr Gilmore said they did not have such an assessment and had not made a decision, but would take action as appropriate when they had the analysis.