Ireland

The number of people using the Insolvency Service of Ireland has increased dramatically in recent months while the number of banks blocking debt settlement deals appears to be falling. According to new figures released by the agency the number of Personal Insolvency Arrangements dealing with debts including mortgage debt approved in the last three months of 2014 increased by 148 per cent over the three preceding months and exceeded the previous three quarters combined, the Irish Times reported.

The cost to individuals of filing for bankruptcy in Ireland has been slashed to €270 from about €1,400 a year ago in a bid to make the process more affordable for those in financial distress, the Irish Times reported. This is in addition to the Insolvency Service of Ireland (ISI) waiving fees until the end of 2015 relating to personal insolvency arrangements (PIAs). These previously cost about €500. The lower fees for bankruptcy were quietly introduced on December 31st. It involves a fee of €200 as a contribution to the work of the official assignee in bankruptcy cases.

The State could eventually recoup all the cash used to bail out AIB, Bank of Ireland and Permanent TSB, Minister for Finance Michael Noonan has said. This would leave the €35 billion cost of bailing out Anglo and Irish Nationwide as the final cash cost to the exchequer from the banking collapse.

The highly critical judgment in the bankruptcy trial of former Anglo Irish Bank chief executive David Drumm has been passed to the office of the US Trustee, which can refer the judge’s findings to the department of justice and recommend criminal charges on perjury and fraud, the Irish Times reported.

Former Anglo Irish Bank chief executive David Drumm could face further legal action from creditors pursuing debts and criminal charges for lying to a US court, following a damning judgment against him, the Irish Times reported. Mr Drumm has lost the protection of the US bankruptcy court, exposing him to litigation for recovery of €10.5 million he owes, after Massachusetts Judge Frank Bailey denied him a declaration of bankruptcy that would have allowed him to avoid repaying his debts.

Tighter loan-to-value ratios for house purchasers and better updating of house valuations for property tax purposes are among the measures cited in a new report on how to dampen house-price cycles, the Irish Times reported.

Irish people are still going to the UK in large numbers to work out their debt difficulties despite the introduction of a similar service in Ireland, new research shows, the Irish Times reported. According to AJ Debt Solutions, an Irish insolvency firm which specialises in UK insolvency processes, it processed close to 100 individual voluntary agreements (IVAs) in the UK for Irish citizens in the last 18 months. This compares with just 59 debt settlement arrangements (DSAs) in the Irish system agreed since September 2013, although 220 applications have been made.

Companies are back in the market for credit but Irish consumers are still more concerned about paying back old debts than borrowing for fresh spending, according to Central Bank money and banking statistics, the Irish Times reported. The November data shows that household loan repayments exceeded loan drawdowns by €335 million during the month, while companies borrowed €139 million more than they repaid. Companies’ medium-term debt borrowings are the biggest climbers, up a net €205 million in November, suggesting a nascent puck-up in investment.

Minister for Finance Michael Noonan is to establish a special working group to examine the costs to the State of financial regulation. This comes in the wake of revelations that the Irish taxpayer is being forced to plug a €58 million hole in the State’s annual regulatory bill, the Irish Times reported. Sinn Féin finance spokesman Pearse Doherty said the Central Bank confirmed to him that €57.9 million of the State’s €136 million bill for overseeing the sector in 2013 went “unrecovered”.

Killorglin Credit Union (KCU) in Kerry has been subsumed into Tralee Credit Union (TCU) following a High Court application on Thursday by the Central Bank, the Irish Times reported. The move follows a secret four-year engagement with regulators to repair its balance failed. It had needed a €3.1 million injection just to meet regulatory reserves.