Irish central bank sees no agreement soon on tracker mortgage plan

DUBLIN, Dec 2 (Reuters) - Technical solutions devised by Ireland (Other OTC: IRLD - news) to help fund loss-making mortgages do not appear likely to win the necessary agreement in Europe in the short term, the country's central bank governor said on Monday.

Ireland has been looking at ways to shift so-called "tracker" mortgages - which follow the European Central Bank's low interest rate and are expensive to fund - from its main banks, to help speed their return to profitability.

The government and central bank have been working with the country's EU-IMF (Frankfurt: MXG1.F - news) lenders on proposals. But Central Bank Governor Patrick Honohan said that while technical solutions have been devised, approval in Europe is a different matter.

"That does not seem likely to be forthcoming in the short-run," Honohan said in the text of a speech to be delivered at a banking conference.

He said that if agreement could be reached, and if the banks can accelerate work on their large backlog of troubled legacy assets, the foundations would be laid for the long-term rehabilitation and repositioning of the banking sector.

The head of the euro zone's rescue fund said in July that he did not think the European Stability Mechanism fund could take loss-making tracker mortgages off the books of Irish banks.