Central Bank sets strict limits to prevent large debts in property funds

The regulator also said the Irish economy should perform well, despite many other countries facing downturns

Gabriel Makhlouf, Central Bank Governor at the publication of the Central Bank of Ireland’s second Financial Stability Review of 2022. Picture:

The Central Bank is planning to set a borrowing limit for Irish property funds under new regulations.

To address risks stemming from leverage in Irish property funds, the Central Bank said it is introducing a leverage limit of 60 per cent of investment.

There is a five-year implementation period for existing funds, which the regulator said reflected both the current macroeconomic environment, and the expectation that funds make gradual and orderly progress to the limit.