Mortgage rates: Action required

ENDA KENNY stated the blindingly obvious yesterday when he said it was not acceptable that banks do not pass on low interest rates to their customers.

His broadside yesterday against the banks echoes the views of Finance Minister Michael Noonan who has sought to make lenders take a more conciliatory approach to mortgage customers.

The reality is, though, that most of the banks are not prepared to listen to reason and will continue to operate as if they never received a cent of taxpayers’ money.

In his spring statement, Mr Noonan signalled that pressure would be brought to bear on the banks in the form of a levy if they refuse to lower rates.

But both Bank of Ireland and Ulster Bank have firmly ruled out cuts to the interest rates on their standard variable-rate mortgages. That sounds like a cartel operating, and suggests a return to the good-old, bad-old days.

Tough talk is not enough. If the banks refuse to play ball, the Government must act to make them see sense.

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