Financial Regulator should use 'powers of persuasion' over rates

The Finance Minister Michael Noonan has said the Financial Regulator should be allowed to use his "powers of persuasion" to convince banks to cut interest rates.

Bank of Ireland and Ulster Bank remain steadfastly opposed to implementing the cut of 0.25%, announced by the European Central Bank two weeks ago.

The Financial Regulator Matthew Elderfield has told the Government he does not want any extra powers to force banks into cutting rates.

Mr Noonan has told the Dáil the Government is willing to try this course of action.

Mr Noonan said: "We will continue our contact with Mr Elderfield, it has been very effective up to now.

"He has a range of powers at his disposal, he says he is not seeking new powers at present and we will see how that develops over the coming weeks."