Government must act on Permanent TSB-Cllr.Aengus O’Rourke

Speaking to this newspaper Cllr. O'Rourke expressed his dissatisfaction at what he calls the Governments 'lack of action' on very serious matters like credit for small businesses, mortgage arrears and the level of interest charged by Permanent TSB on its variable mortgages.

"The Government must use all means possible to bring about a reduction in the standard variable interest rate charged by State-owned Permanent TSB on mortgages. The government has also yet to address the issue of credit availability for SMEs and the escalating mortgage arrears crisis.

"State-owned Permanent TSB is still charging a standard variable rate of 5.19% to its existing mortgage customers – that’s over 2% higher than another state-owned bank AIB (3.04%). This exorbitant interest rate is crippling hundreds of families in Athlone and thousands around the country and needs to be addressed urgently. The variable rate customers of Permanent TSB should raise this issue with their local Government TDs and demand Government action on the matter.

“In a normal functioning market, customers would be able to switch to another lender offering a more competitive rate. However, due to the lack of a normal credit supply in the market, Permanent TSB customers are effectively trapped in expensive mortgages, adding hundreds of euro to their monthly repayments in many cases.

“In the case of a family with a €250,000 mortgage over 25 years, the annual repayment on a Permanent TSB standard variable rate mortgage is €3,582 more than if it were with AIB. That’s an extra €300 per month because of the higher interest rate being charged. Over the lifetime of the loan, this mortgage-holder would end up repaying €90,000 more than an AIB customer. This differential is completely unacceptable.

“The Government must also come forward with its strategy, if it has one, for dealing with the deepening mortgage arrears crisis. The Keane report was completed over 5 months ago and we still do not know which recommendations are being acted upon and which have been mothballed. Meanwhile, the mortgage arrears picture continues to get worse while the Government sits on its hands. Families in mortgage distress want action from Government, not more meaningless platitudes about Government priorities.”

 

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