Central Bank commences public consultation in next phase of mortgage measures framework review

16 December 2021 Press Release

Central Bank of Ireland

  • The Central Bank’s mortgage measures were first introduced in February 2015 to support sustainable lending practices in the Irish mortgage market.
  • As the measures are a permanent feature of the market, this framework review aims to ensure that the measures remain fit for purpose into the future, amid continued evolution of the financial system and broader economy.
  • Consultation follows extensive public engagement held during the summer, the insights of which have fed through to the consultation.
  • Stakeholders are invited to provide feedback by Wednesday 16 March 2022.

The Central Bank has today (December 16) commenced a public consultation on the next step of the ongoing framework review for the mortgage measures.

The mortgage measures were introduced in 2015 to support a sustainable provision of mortgage finance, strengthening the resilience of borrowers and lenders and guarding against the risk that another credit-fuelled housing boom emerges. As part of this framework review, the Central Bank is considering the overall approach, toolkit and strategy for the measures, to ensure they continue to remain fit for purpose in light of the evolving financial system and broader economy.

The consultation launched today marks the second phase in the public engagement as part of the review. During the summer, the Central Bank conducted an online survey alongside a series of listening events, where we asked the public and other stakeholders to share their views on, and experience with, the mortgage measures. The Central Bank has today published summary reports of these events, the insights of which have informed the areas covered in the consultation. Substantial research by the Central Bank and engagement with external experts has also informed the consultation.

The consultation invites interested stakeholders to provide feedback on a range of specific questions relating to the mortgage measures framework. The consultation will close on Wednesday 16 March 2022 and can be viewed at centralbank.ie/mmfr. The Central Bank will consider the feedback it receives from the consultation paper. This feedback, in addition to further research and analysis by the Central Bank, will inform the final conclusions on the design of the framework. The Central Bank will then consider the implications for the calibration and implementation of the mortgage measures. The framework review is due to be concluded in the second half of 2022.

Director of Financial Stability, Vasileios Madouros, said: “The mortgage measures have been – and will continue to be – an integral and permanent feature of the Central Bank’s macroprudential policy framework. Since their introduction, they have played a key role in building resilience of both borrowers and lenders and have guarded against the emergence of an unsustainable, credit-fuelled housing boom. By reviewing our overall approach, toolkit and strategy for the measures, we want to ensure that the measures remain fit for purpose, not just now, but into the future.

“The listening and engagement events we held over the summer provided the Central Bank with a deep insight into the public’s views on many aspects of the mortgage measures. Together with our own analysis and research, the information gathered through the listening and engagement events, has formed the basis for this consultation paper, which outlines the Central Bank’s current thinking on the mortgage measures framework.

“From the outset, we have been clear that engagement with stakeholders will be a core element of our review. The level of engagement has been extremely beneficial so far and, as we move to the next step in the review, I encourage stakeholders to provide feedback on the consultation.”