Ireland set for ‘devastating crash’ if rules relaxed, says Gerlach

Former Central Bank deputy warns against loosening property lending regulations

“A telltale sign of a bubble is that second-rate developers suddenly are able to earn billions,” said former deputy governor of the Central Bank Stafan Gerlach. Photograph: Eric Luke / The Irish Times

“A telltale sign of a bubble is that second-rate developers suddenly are able to earn billions,” said former deputy governor of the Central Bank Stafan Gerlach. Photograph: Eric Luke / The Irish Times

Ireland could face another property crash if market regulations are relaxed, former deputy governor of the Central Bank Stafan Gerlach has warned.

Mr Gerlach, who left the bank earlier this year to become chief economist at BSI Bank in Zurich, said the construction industry and politicians are putting pressure on the regulator to relax the loan-to-value and loan-to-income ratios on mortgage lending introduced last year.

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