Halifax set to close retail division here after order by UK Treasury
The Halifax Bank in Ireland is set to close its retail division. Photo: Getty Images
THE Halifax Bank in Ireland is set to close its retail division following an instruction from the UK Treasury to repatriate assets back to the UK.
The 'Sunday Tribune' reported that Bank of Scotland Ireland is preparing to shut the Halifax starting in September following an instruction from the UK Treasury to cease lending here and repatriate £20bn of the £35bn in Irish assets.
It said the move was the culmination of an extensive review, dubbed 'Project Primrose', which started after the bank was forced into a merger with Lloyds TSB, in which the UK government now owns 43pc.
The closure may be announced at the end of August, the newspaper said.
Lloyds will keep its business banking division here, as well as the savings and investments side of the retail business. The property lending business will all but disappear when £20bn in assets is transferred to the UK parent, the 'Tribune' said.
Delinquent
The move comes against a deteriorating lending environment in Ireland, with the rating agency Standard & Poor's reporting that nearly 4pc of all mortgages are delinquent, or in arrears for more than 30 days.
The number of borrowers in arrears for more than 90 days has almost doubled in the last year, the report added.
Standard & Poor's said Irish residential mortgage-backed securities transactions are experiencing the most testing economic environment since the inception of that market.
"The Irish economy is deep in recession and delinquencies have risen," the agency said, adding that while defaults are rising, the number of repossessions reported to date has been relatively low, and losses are currently negligible.
"We understand that the legal system is generally considered to be 'borrower-friendly', it said, adding that the introduction of schemes such as the Code of Conduct on Mortgage Arrears, which prevents lenders from entering court proceedings until at least six months after arrears first arise, has slowed the pace of repossessions.
- PAT BOYLE
