The latest figures from the Central Bank show that weakness in residential mortgage lending persisted in November.The Central Bank says that mortgage lending rose by just €96m in November.
This compares with an average monthly increase of over €850m between January and September of this year.
It also compares with an average monthly increase of almost €2bn at the height of the housing boom in 2006.
The annual rate of increase in residential mortgages slowed to 6.7% last month from 7.6% in October – the lowest annual rate of increase since 1986.
Overall, private sector credit growth slowed to 8.4% in November from a figure of 8.9% the previous month.
The figures from the Central Bank also show that new credit card spending was slightly over €1bn in November, the lowest level since April 2006
The Government has announced support for a recapitalisation programme of up to €10 billion for credit institutions.
In a statement issued this evening, it said its objective was to ensure the long-term sustainability of the banking sector in Ireland.
The Government said it would support the programme alongside existing shareholders and private investors, and would underpin its contribution through the availability of credit to individuals and businesses in the real economy.
After a day of meetings, Minister for Finance Brian Lenihan confirmed that money from the National Pensions Reserve Fund will be used in the recapitalisation programme.
State investment will take the form of preference and/or ordinary shares in the institutions receiving funds.
Mr Lenihan said State investment would be assessed on a case-by-case basis and all the institutions were being asked to submit their proposals by early next month.
A spokesperson for AIB said the bank’s board would discuss the Government announcement when it meets later this week.
