Irish Central Bank proposes new mortgage lending restrictions (Ie loan-to-income (LTI) ratios)
The Central Bank says it’s very appropriate to bring in limits on new mortgage lending
The Central Bank has proposed new restrictions on how much banks can lend to home buyers in an effort to reduce the risk of a new property bubble forming as prices recover rapidly from the property crash.
The bank said it was appropriate to bring in limits on new lending at high loan-to-value (LTV) or loan-to-income (LTI) ratios as house prices in Dublin jumped by 25% in the year to August.
Today’s proposed measures will require banks to restrict lending above 80% of the value of a home to no more than 15% of the aggregate value of all housing loans.
They will also restrict lending above three and a half times the borrower’s income to no more than 20% of that aggregate value.
The proposals are contained in a consultation paper and banks have until December 8 to respond to them.
Today’s measures also include a lower threshold for buy-to-let properties. They require banks to limit loans of over 70% of the value of investment properties to 10% of all buy-to-let loans.
The head of financial regulation at the Central Bank, Cyril Roux, said there was concern that the market was getting back to a place where some borrowers were taking out loans where their ability to repay was tenuous.
“These measures have been carefully considered and, taking past experience into account, are being introduced at an appropriate time to ensure borrowers and lenders can withstand potential economic or property market shocks in the future without financial distress,” Mr Roux said.
Mr Roux said the new measures are not intended to replace lenders’ own risk management practices, but rather they should reinforce and strengthen the existing risk mitigation practices used to ensure prudent lending.
Stefan Gerlach, the Central Bank’s deputy director, said the measures were not aimed at limiting or steering prices but would probably have an impact on the pace of price increases.
He said the main objective of the new measures is to increase the resilience of the banking and household sectors to the property market.
Minister Fergus O’Dowd who set up Irish Water now brands it a disaster
COALITION TD SAYS ‘UNCARING’ AGENCY IS AN ABJECT FAILURE
The former Minister who helped establish Irish Water has criticised the company’s approach to introducing water charges, describing it as “an unmitigated disaster”.
Ex-junior environment minister Fergus O’Dowd, who developed the legislation which set up the utility, said it had “abjectly failed” in selling its message to consumers.
In an unprecedented attack from a Government TD, Mr O’Dowd said: “Irish Water has come across as arrogant and uncaring, demanding money and demanding PPS numbers without properly explaining why all of this is necessary.”
He also spoke of his fears that it was becoming “another cosseted quango with a bonus culture” and his belief that disadvantaged groups are faced with having to pay more for water than they should.
The criticism couldn’t have come at a worse time for the Government as it faces into two by-elections on Friday.
Water charges are proving to be a key election issue in Dublin South West, while water quality is a huge cause of concern in the Roscommon-South Leitrim constituency, where 21,000 people are living with boil water notices.
Minister examining proposals to bring Irish Water under the Ombudsman’s remit
Mr. O’Dowd, who lost his ministry in the Government reshuffle during the summer, made the comments in a piece for today’s Irish Independent.
Asked what actions he had taken over his concerns, Mr O’Dowd said he had raised them with department officials and the then environment minister, Phil Hogan, who is now the designate EU Commissioner for Agriculture and Rural Development.
Mr O’Dowd’s involvement with the utility company ended after he steered the legislation setting it up through the Oireachtas. Ministerial responsibility was taken by Mr Hogan at that point.
He said he had asked Mr Hogan for more responsibility, but this was not given to him.
Mr O’Dowd said the new company had been its own worst enemy and would not be facing as much resistance if it had adopted a better communications strategy.
“I warned the department at a high level meeting that it was going to be an unmitigated disaster if there was not enough engagement with the public and that has proven to be the case,” he said.
The former minister refused to apportion individual blame for the shortcomings he identified.
“This is not about personalities,” he told the Irish Independent. “It is about bringing about real change in Irish Water. This organisation has to change its ways right now and listen to the people.”
Mr O’Dowd said people felt “angry and intimidated” after receiving their sign up packs in the post, requesting copies of PPS numbers.
He said it was clear there was “an intense dislike of the whole process”.
An information campaign focusing on the positives the company can bring in terms of water conservation and the environment would have been much preferable to the approach it has adopted, he said.
The former minister called for the introduction of new board members with a consumer advocacy background.
He said there should be a widening of exemptions as unemployed people were telling him they simply could not afford the charges.
Mr O’Dowd also said he only became aware that staff at the company would be entitled to bonuses when it was disclosed at an Oireachtas committee in January. He said he believed the practice should be scrapped.
Irish Water managing director John Tierney disclosed at the time that staff were in line for performance related bonus payments averaging €7,000 under a model it adopted from its parent company Bord Gais.
IT IS UNDERSTOOD NO BONUSES HAVE BEEN PAID TO DATE.
However, the company would find it difficult to deny staff bonuses they were contractually entitled to.
Mr O’Dowd has previously said he was not made aware of €50m worth of consultancy contracts awarded by the new company when it was being set up.
Mr Hogan also said he was unaware of these payments when details emerged last January and expressed concern about them at the time.
Documents uncovered in recent weeks suggest he was informed of allocations in December 2012.
However, Mr Hogan last week dismissed accusations he “misled” the public and defended the costs involved, saying the setting up of a new system costs money.
Irish Water has urged householders not to ignore the information packs it has sent out.
Families who refuse to register and provide information could be hit with bills twice what they would normally pay.
This is because each household which fails to provide details will lose free allowances.
A four-person family with two children is expected to use 129,000 litres of water a year, but would be entitled to a free allowance of 72,000 litres, leaving a bill of around €278-a-year.
Irish Water will not be able to turn off the supply of customers who refuse to pay.
However, it can bring people to court to recover debts.
The company is proposing to invest €1.77bn as part of its capital investment programme up to 2016.
Irish Economy to grow by 6%, says Ibec
The business lobby group Ibec has almost doubled its growth forecast for this year to 6.1% on the back of positive data across the economy.
The group had originally forecast GDP growth of 3.1% for 2014, and also hiked its projections for next year to 4.5% from 3.9%.
It predicted exports will grow at their fastest pace since the turn of the century and said business sentiment remains high, with companies displaying strong faith in the recovery.
Ibec economist Fergal O’Brien said the economy was recovering much faster than many had expected.
ECONOMIES
“Importantly, growth is coming from a broad range of sources, with domestic demand and trade contributing strongly,” Mr O’Brien said.
“Ireland is set to be one of the world’s best-performing developed economies this year,” he added.
Ibec reiterated its call for income tax cuts in next week’s budget, saying there was no need for any further austerity.
But it said that despite the strong growth figures, Ireland remains about 3.5% below its peak in terms of volume levels. It said exports would grow by more than 12% this year – the strongest growth since 2000.
There’ll be similar trends in imports, which will rise 11%, the lobby group said.
With confidence among companies remaining strong, Ibec said it expects investment growth this year and next of 14.3% and 13.8% respectively.
Employment numbers will return to early 2009 levels by next year, it predicted.
“Ireland is firmly on the way back and this gives the Government options on Budget day. Recent tax hikes have pushed our marginal tax rate, at 52%, way out of line with our international competitors,” Mr O’Brien said.
Sleep apnoea sufferers are seven times more likely to fall asleep at wheel
A survey shows one in 10 Irish motorists have fallen asleep at the wheel at some point in the past.
Prof Walter McNicholas told a road safety conference today that short rests should not be seen as a cure for tiredness but as a temporary relief.
People who suffer from sleep apnoea (a condition in which breathing is disrupted during sleep) are seven times more likely to fall asleep while driving, road safety experts warned today.
With 146 people killed on the country’s roads so far this year – just one below the death toll in the same period last year – motorists are being cautioned about the impact the condition and tiredness can have on the risk of collisions.
The Road Safety Authority (RSA) revealed statistics on how lack of sleep can lead to deaths on the roads, with fatigue believed to be a factor in one- fifth of all collisions.
Prof Walter McNicholas, director of the pulmonary and sleep disorders unit at St Vincent’s University Hospital, said short rests should not be seen as a cure for tiredness, but as a temporary relief.
“Untreated sleep apnoea is associated with high levels of sleepiness, which makes driving incredibly dangerous,” he said .
“When treated effectively, sleep apnoea is incredibly manageable, so awareness of the signs and early diagnosis is key.”
In a presentation at the RSA annual safety lecture, the professor said a 15 to 20-minute sleep will only revive a driver for up to an hour.
Prof McNicholas said evidence from research into the cause of road crashes shows, on average, a fifth to a quarter of all motorway crashes are due to excessive sleepiness.
The RSA said a survey of driver attitudes and behaviour carried out last year which showed that as many as one in 10 Irish motorists admitted they have fallen asleep at the wheel at some point.
The authority said the road death toll this year is currently almost as high as last year, when the number of accidents led to the first increase in road deaths since 2005.
Minister for Transport Paschal Donohoe said: “Sadly we have seen worryingly high deaths on our roads so far again this year, almost on a par with last year.”
“But if we have learned anything from the previous few years, it’s that we can all make real changes to improve road safety. So this week, consider what you can do to make our roads safe.”
How to Watch Tonight’s ‘Blood Moon’ Total Lunar Eclipse
This year has been filled with a lot of big events: a satellite landed on a friggin’ comet, Apple released a giant friggin’ iPhone, and George friggin’ Clooney finally got friggin’ married! 2014 was also a year in which there was not one but two total lunar eclipses visible from North America—the second of which will take place later tonight (or very early tomorrow morning, depending on where you are).
Those in the middle of the Pacific Ocean will have the best view, but U.S. readers in the contiguous 48 states will have tickets to the show as well, though at far less convenient start times.
The action will begin for West Coast skywatchers at 1:17 a.m. PT and the whole process will have run its course by 6:32 a.m. On the East Coast, the events won’t begin until 4:17 a.m. ET, but the process will barely have kicked into high gear before the scheduled 7:01 moonset. While they won’t get to see the finale, viewers on the East Coast (with a clear view of the horizon) will have the unique opportunity to watch an eclipsing moon setting below the horizon, which should be a treat in and of itself.
Unlike fainter astronomical events such as meteor showers, viewers in urban areas will be able to watch the whole event without leaving town—if you can see the full moon under normal conditions, you will be able to see a lunar eclipse. Those on the East Coat, however, should keep in mind that they will want to have as clear a view of the western horizon as possible.
The only thing that will hinder most people in the eclipse-viewing area from catching the show is cloud cover. If nature isn’t cooperating in your location, you can follow online with crowdsourced astronomical team Slooh’s live eclipse coverage, which is embedded below. Additionally, NASA will offer a livestream of the eclipse on its Ustream page, which will include a live Web chat beginning at 3 a.m. ET to answer any questions.
BLOOD MOONS AREN’T REALLY A THING
A total eclipse is what happens when the moon dives into the darkest part of the Earth’s shadow or umbra. When this happens, the moon doesn’t simply fade into the dark sky, but rather it slowly transitions from bright white into a deep reddish-orange hue.
This reddening is the result of sunlight refracting through the Earth’s atmosphere. Usually the direct light from the sun “washes” out this refracted light, but during a lunar eclipse this refracted red light is the only thing illuminating the lunar surface and thus is why the moon appears to turn red.
You may have seen many in the media dubbing tonight’s event a “blood moon,” just as they did with eclipse in April. Let’s get something clear: This term doesn’t have any actual astronomical significance—all total lunar eclipses turn a deep blood reddish hue. This happens during ev-er-y eclipse. But the phrase “blood moon” sounds spooky and has recently been co-opted by the fire-and-brimstone crowd so, we’re kind of stuck with this meaningless nothing-phrase.
But unlike April’s eclipse, tonight’s “blood moon” will occur directly after the moon’s perigee, or the closest point in its orbit around the Earth, which means that the moon will appear similar in size to the so-called “supermoon.” In fact, according to CNN, tonight’s lunar eclipse will appear 5.3 percent larger than the one back in April.
There are usually around two lunar eclipses per year, but they’re not visible to all parts of the Earth. According to Slooh’s astronomy team, North America won’t get to see two total lunar eclipses in the same year until 2022. That’s another two presidential administrations away!
If you do miss tonight’s events for some reason (sleep, for example), don’t worry, there will be another, more conveniently timed, total lunar eclipse visible from North America in September 2015.
Cannibal spiders are unleashed
TUBE SPIDER FILMED CATCHING AND EATING SMALLER SPIDER
This one involves a massive spider eating one of his smaller eight legged friends.
The fearsome tube spiders, which sport green fangs they use to devour their enemies, have been spotted several times throughout the UK over the past few months.
Mike Rance was filming one of the giant beasts in his friend’s house in Newport, Wales when he caught it pouncing on one of its fellow arachnids and eating the poor thing alive.
‘We then tried [feeding it] a normal sized spider but it didn’t want to know,’ the 41-year-old said. ‘They only seemed to want to eat smaller ones, I guess they must be easier prey.’
The tube spider darts and and catches its prey with its fangs (Picture: Caters)
Rather than follow the logical course of action and burning the house down before moving to Antarctica, Mike caught the spider and passed it onto a vet, who confirmed it was in fact a tube spider, the bite of which cause excruciating pain for up to six hours.
Mike also found that a neighbour of his friend had a nest containing ‘about 30 or 40 in his back garden’.
Tube spiders, which first came to the UK 150 years ago but have recently seen their numbers grow, typically hide during the day before sneaking out at night looking for food.
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