Elderfield warns banks over hikes in interest rates

THE Financial Regulator has told the banks he wants to halt variable interest rate hikes and warned them he will be “breathing down their necks” to ensure compliance with his mortgage arrears code.

Matthew Elderfield said that while banks may be hiking interest rates to make up for money lost on non-profitable tracker mortgages, such moves may be “self defeating” as they could push more customers into arrears on their mortgage payments.

Up to 200,000 Irish homeowners have standard variable rate mortgages and some have seen the interest on their mortgage repayments increase to as high a rate as 6%.