Ecb says 20% of Irish bank loans non performing

[mister32]

As compared to 7% across Europe

Maybe the difference ie 13% is customers who should be on tracker?

If only they were returned to tracker it would solve the problem.

Because obviously they would be performing then.

Oh and reduce the exorbitant variable rates!

Eg 5.65% Bank of Ireland charging on investment

 

[Sarenco]

Here's a link to the ECB story:-
http://www.rte.ie/news/business/2016/0912/816030-ecb-non-performing-mortgages/

Because obviously they would be performing then.

Why obviously?

The available evidence would suggest that the worst default rates relate to mortgages that were originated between 2004-2007, when trackers were widely available:-

[broken link removed]

Oh and reduce the exorbitant variable rates!

The appalling default rate is the proximate cause of the high cost of credit in Ireland - not the other way around.

At this stage it really is extraordinary that 20% of outstanding mortgages are still non-performing. If people want lower mortgage rates, they should be screaming at their public representatives to sort this out.

The plaster needs to be pulled.

 

[trasneoir]

What's the definition of "non performing"?

If it means that the lender has not received all of the planned payments to date, then I wouldn't be shocked.
For example lots of borrowers will have taken an interest-only period at some stage and won't "catch up" until the last repayment is made.

If it means that the lender has not received all payments in full for the last 12 months, then 20% seems a very big number.

 

[Sarenco]

What's the definition of "non performing"?

From the ECB's website:-

"A loan is only deemed non-performing if it is in default or close to default. More precisely, a loan is non-performing when payments of interest and principal are past due by 90 days or more, in accordance with the Basel II definition of default, or when there are good reasons to doubt that debt payments will be made in full."

Where a borrower is meeting their obligations under a renegotiated loan that wouldn't be considered non-performing.

The ECB has launched a public consultation on guidance to banks on how they should tackle non-performing loans:-

https://www.bankingsupervision.europa.eu/press/pr/date/2016/html/sr160912.en.html

 

[mister32]

So the Ecb is setting out to tackle non performing loans.

In the case of Ireland will the Ecb support reducing interest rates?

Will the Ecb investigate the tracker mortgages wrongly taken from customers?

 

[Sarenco]

So the Ecb is setting out to tackle non performing loans.

No, the ECB has launched a public consultation on what guidance should be given to banks as to how they should tackle NPLs.

In the case of Ireland will the Ecb support reducing interest rates?

No, the ECB has no mandate to direct the commercial operations of Irish banks.

Will the Ecb investigate the tracker mortgages wrongly taken from customers?

No, the ECB has no mandate to supervise banks at this level.