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International Monetary Fund. Monetary and Capital Markets Department
This note analyzes select aspects of the system for insolvency and creditors’ rights in the context of an overall assessment of the Irish financial sector. It focuses on two areas: (i) the use and effectiveness of the corporate restructuring regime (examinership) and (ii) the resolution of mortgage related NPLs. Corporate restructuring was considered particularly relevant given that the authorities are currently in the process of amending their insolvency system to incorporate the provisions of the European Directive on Preventive Restructuring Procedures (the “EU Directive”) and have recently adopted a new debt resolution regime for small and micro-sized enterprises. The mission team also focused on the resolution of mortgage related NPLs, given that they constitute 46 percent of all NPLs (total loans) in the retail banking system and pose a challenge to the effectiveness of the overall system for debt resolution and creditors’ rights. This analysis has been conducted against the international insolvency standard (the “Standard”), where relevant.2
Alexandra Fotiou, Alica Ida Bonk, and Georgios Manalis
Khalid ElFayoumi, Ms. Izabela Karpowicz, Ms. Jenny Lee, Ms. Marina Marinkov, Ms. Aiko Mineshima, Jorge Salas, Andreas Tudyka, and Ms. Andrea Schaechter
Many European economies have faced pressure from rental housing affordability that has widened social and economic divergence. While significant country and regional differences exist, this departmental paper finds that in many advanced European economies a large and rising share of low-income renters, the young, and those living in cities is overburdened. In several locations, middle-income groups also increasingly face rental affordability issues.
International Monetary Fund
The Tenth Periodic Monitoring Report (PMR) on the Status of Management Implementation Plans (MIPs) in Response to Board-Endorsed Independent Evaluation Office (IEO) Recommendations assesses the progress made over the last year on actions contained in 10 MIPs with open management actions.
International Monetary Fund. European Dept.

This 2016 Article IV Consultation highlights that the rebound of the Irish economy has been exceptional. High frequency indicators suggest that growth momentum has continued in 2016. Solid job creation has reduced the unemployment rate below 8 percent. Inflation has hovered around zero as low commodity and food prices more than offset rising cost of services, particularly housing rents. Taking into account negative spillovers, real GDP growth is projected to decline to just below 5 percent in 2016 and converge to its estimated potential over the medium-term on the back of more moderate export growth and investment activity.

Mr. Thierry Tressel and Ms. Yuanyan S Zhang
The crisis has highlighted the importance of setting up macro-prudential oversight frameworks, having effective macro-prudential instruments in place to be called upon to mitigate growing financial imbalances as needed. We develop a new approach using the euro area Bank Lending Survey to assess the effectiveness of macro-prudential policies in containing credit growth and house price appreciation in mortgage markets. We find instruments targeting the cost of bank capital most effective in slowing down mortgage credit growth, and that the impact is transmitted mainly through price margins, the same banking channel as monetary policy. Limits on loan-to-value ratios are also effective, especially when monetary policy is excessively loose.
Mr. Helge Berger, Mr. Thomas Dowling, Mr. Sergi Lanau, Mr. Mico Mrkaic, Mr. Pau Rabanal, and Marzie Taheri Sanjani
Potential output—in the sense of the GDP level or path an economy can sustain over the medium term—is a crucial benchmark for policymakers. However, it is difficult to estimate when financial “booms and busts” are driving the real economy. This paper uses a simple multivariate filtering approach to illustrate the role financial variables play in driving potential or sustainable output. The results suggest that it moves more steadily during financial “boom and bust” periods than implied by conventional HP filter estimates, which tend to more closely follow actual GDP. A two-region, multisector New Keynesian DSGE model with financial frictions sheds light on the economic forces that could be behind the results obtained from the filter. This has important implications for policymakers.