The Financial Regulator has published two new codes of conduct under Section 117 of the Central Bank Act 1989 and applicable to the providers of financial services. Both codes are statutory codes and the Minister for Finance has indicated that banks will be required to demonstrate compliance.
The Code of Conduct for Mortgage Arrears builds on an existing voluntary code of practice issued by the Irish Banking Federation and incorporates a requirement for a lender to wait at least six months from the time arrears arise before taking legal action. ( In the context of the code, note should be taken of additional measures with regard to enforcement of housing loans now included in the Land and Conveyancing Law Reform Bill 2006).
The Code of Conduct for Business Lending to Small and Medium Enterprises will apply to all regulated banks and building societies. The Code includes a requirement for banks to offer business customers annual review meetings, to inform customers of the basis for decisions made and to have written procedures for the proper handling of complaints.