The head of the country’s second-largest lender has thrown his weight behind the Central Bank’s proposed mortgage restrictions, saying that he agrees with the principles on which they are based.
AIB chief executive, David Duffy said that the proposals with regard to loan-to-income (LTI) restrictions of 3.5 times a lender’s annual income are “not really that different” from those the bank currently applies, while he also gave his broad support to the loan-to-value (LTV) restrictions the Central Bank has proposed.
Mr Duffy indicated that he felt that the 20% rate is a little higher than he expected, in comparison with other countries, but said that, across the bank’s mortgage portfolio, the average LTV is already below the proposed 80% limit.
He also said he was hopeful that there would be no “significant negative news” over the weekend, when the European Central Bank publishes the results of stress tests conducted across 130 eurozone banks.
The proposed measures outlined by the Central Bank a fortnight ago would require prospective home-buyers to stump up a deposit equal to 20% of the value of the property — a policy that has been questioned by a number of economists and several Cabinet members, including Tánaiste Joan Burton.
Meanwhile, Cork Chamber president Gillian Keating accused the Government and Dublin Airport Authority of “handcuffing” Cork Airport and its management team, who had done “Trojan work” to cut costs and make the airport a success.
“Cork Airport and its management team are handcuffed,” said Ms Keating. “They are handcuffed by a failure in this Government’s policy view on Cork Airport. They are handcuffed by the DAA’s position on the debt.”
The airport is saddled with a €100m debt arising from the construction of a new terminal in 2006 at a time when passenger numbers were rising.
Ms Keating added that the Government’s strategy for Cork Airport, as outlined in the National Aviation Policy report, was ad hoc and focused on the opportunities for Dublin and Shannon airports.
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