Latest News

Hayes raises PTSB loan sell-off with ECB leadership

Brian Hayes MEP has raised the issue of the Permanent TSB loan sale with both ECB President Mario Draghi and the Chair of the ECB’s supervisory arm, Daniele Nouy. Mr. Hayes questioned President Draghi about the issue at a hearing in the European Parliament today (Monday) and also submitted a letter to Ms. Nouy on the issue.

“Today I asked Mr. Draghi whether the ECB policy of ensuring that banks reduce non-performing loans (NPLs) as quick as possible is consistent with high consumer protection standards.

“Mr. Draghi outlined that the ECB position is to treat NPLs equally across all Eurozone countries. While I understand that the ECB is focused on ensuring that the European banking system is healthy, it needs to consider the issues that each Member State faces when reducing NPLs. Having such a strict definition of an NPL is something that needs to be looked at.

“It is also clear that the ECB is not opposed to further regulation at Member State level which aims to strengthen consumer protection when it comes to NPL sales. However, we must consider Mr. Draghi’s comments that banks with high levels of NPLs will ultimately not be able to support as many individuals and businesses in terms of new lending.

“I also sent a letter to Daniele Nouy in order to get a formal response from the Single Supervisory Mechanism (SSM) as the lead supervisor of Irish banks. They have set the policy on reducing NPLs across the European banking system and they need to comment on what is happening in Ireland.

“What is crucial to understand, before the more strident stress tests later this year, is whether PTSB can survive with or without this almost €4 billion sale of its loan book. And what are the implications for the bank were they not to reduce their high NPL rate.

“The SSM needs to inform Irish consumers if they believe the proposed sale meets the ECB guidance on NPLs. Pretending that all this is a matter for Irish policymakers when the SSM set the rules is politically dishonest and misleading.”

0 comments on “Hayes raises PTSB loan sell-off with ECB leadership

Leave a Reply

%d bloggers like this: