Tánaiste refuses to stop bank rate hikes

Eamon Gilmore has refused to intervene and prevent state-owned lenders hiking up mortgage interest rates but called for bankers’ pay to be brought under control.

The Government was accused yesterday of letting the mortgage arrears crisis escalate after bailed-out AIB and EBS signalled an increase in their standard variable mortgage interest rates.

Mr Gilmore said it was bad news for mortgage holders but the decision was taken for “commercial reasons”.