New EBA guidance should pave way for reintroduction of payment breaks
- No excuse for Irish banks not to reactivate structured payment breaks for borrowers in financial difficulty because of Covid-19 restrictions
Labour’s Finance spokesperson Ged Nash has said Irish banks have no excuse not to reintroduce a new national programme of structured payment breaks for distressed borrowers who face financial difficulties arising from the second wave of Covid-19.
His calls come in the wake of a decision by the European Banking Authority (EBA) to activate revised guidelines to banks across Europe on payment moratoria. The previous blanket moratoria system expired at the end of September.
Deputy Nash said:
“I have been in contact with the representative body for the Irish banks today on this pressing matter for distressed borrowers.
“The initial payment break was introduced under EBA guidance and for the sake of consistency, there is no excuse now for the main lending institutions here to continue to refuse to bring in such measures.
“The EBA is clear that they have decided to reactivate these payment holidays to account for the real lived experience of all of those who have been financially hit as a result of government imposed restrictions on economic activity which have been designed to deal with the second wave of Covid-19.
“A statement this morning from the Central Bank notes that ‘As there is no open national general payment moratoria scheme currently operating in Ireland, this decision has no immediate effect for Irish borrowers.’
“The message from the EBA is clear. Those who have lost income due to recent restrictions should be able to access payment breaks on mortgages and loans without their credit history being adversely affected.
“The Minister for Finance must make a clear statement that the banks need to put the best interests of their customers first and reintroduce structured breaks under the new EBA framework to help borrowers get to the other side of this unprecedented storm.”