Kenny: State bank guarantee to end in March

Banks are expected to sign up to a new agreement with the Government early next year which will include more commitment from lenders on helping homeowners in mortgage arrears.

Enda Kenny has revealed that the state guarantee on deposits in banks will be gone by March but that a new deal will be done with lenders.

He also revealed that an expected Cabinet reshuffle will not take place until at least the second half of next year, after Ireland’s presidency of the EU.

Speaking at a special briefing for journalists, he said: “I expect to have a new deal with the banks by March, and that will include an ending of the guarantee in order to reduce the funding costs of the banks and more specific commitments by the banks, and lending and dealing with mortgage arrears.

“We’ll be inviting the banks to engage with the newly re-formed cabinet committee on banking and mortgage arrears, with the minister for finance taking the lead in this area.”

The latest banking figures show that nearly 90,000 mortgage owners are in arrears of 90 days or more.

Mr Kenny added: “Clearly, one of the best pieces of news that any household can get is that a situation has been arrived at where there is a conclusion, or an agreement in regard to a mortgage that is either in distress or where there is a difficulty.

“That’s also part of the process of moving on from having to inherit the banking guarantee legacy, so this is an opportunity to move to a point where banks themselves can move away from having that guarantee.”

The Taoiseach also hinted that any Cabinet reshuffle was off the cards until at least the halfway point of the Government’s five-year term, next autumn.

“I think we have got a very big focus here on the [EU] presidency. I have spoken to each individual minister, they have got a hell of a workload, for which they have been well prepared.

“So if you want to say that is a reprieve, say it’s a reprieve but these are matters, I suppose, that are always floating around in people’s heads. I am interested in results actually.”

In recent weeks, there has been speculation of Tánaiste and Foreign Affairs Minister Eamon Gilmore moving to a more financed-focused portfolio and Health Minister James Reilly moving across to another brief.

Any reshuffle is also likely to spark a race for Europe, with suggestions that both Environment Minister Phil Hogan and Education Minister Ruairi Quinn are keen for a post as commissioner in Brussels.

Mr Kenny also played down calls by Labour figures for a renegotiation of the Programme for Government.


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