Press Statement from Frances Fitzgerald MEP
Tuesday 5th July 2022
Frances Fitzgerald calls for action to improve options for mortgage holders
Dublin MEP Frances Fitzgerald has called on the Central Bank of Ireland to prioritise attracting new retail banking services to Ireland in order to increase competition and improve services for bank customers, including mortgage holders. As Ulster Bank and KBC prepare to leave the Irish market, Ireland will soon be left with only three retail banks - thereby reducing competition and options for those seeking better mortgage rates. Figures from April 2022 show that mortgage rates in Ireland are above the euro zone average.
MEP Fitzgerald has also co-authored a report on the EU’s developing Banking Union, which supports an integrated market for banking across and Eurozone and includes a call to establish a European deposit insurance scheme in the interests of bank customers, businesses, and those looking to access a mortgage. The report will be voted on by the European Parliament today.
Frances Fitzgerald MEP said, “Irish people can see the downsides of our over-concentrated retail banking market. Mortgage rates in Ireland were 2.77% on average in April 2022, well above the euro zone average of 1.59%. With only three retail banks left in the market, Irish customers will have fewer opportunities to shop around for the best value and are more likely to face further uncompetitive lending and mortgage rates. This is not an acceptable situation. This situation is also particularly difficult in the light of the general rise in the cost of living.
“This is why I am calling on the Central Bank to take action to bring new retail banks into the Irish market. We know that Irish banks are still dealing with legacy issues arising from the financial crisis and that this is impacting the market for retail banking. However, it must be acknowledged that Ireland will soon have the fewest mainstream retail banks per head of population of any country in the European Union. This is not in the interests of customers and our economy.
“My report on the EU’s Banking Union, which will be voted on by the European Parliament today, considers a number of ways in which a more integrated market for banking in the Eurozone, including in Ireland, could be developed in order to attract new investment in the interests of customers. Some of the topics include maintaining a common European rulebook and resolution fund for banks at an EU level, addressing non-performing loans, taking action on money laundering, and establishing Europe-wide protection for bank deposits thought a European Deposit Insurance Scheme.
“I know that the causes of consolidation in the retail banking market are varied and diverse, but this should not prevent such actions by the Central Bank to try and find solutions. Irish people deserve to have a greater choice of banking services.”