Anglo to probe INBS mortgages
ANGLO Irish Bank, which is scheduled to be wound down over 10 years, has ordered a review of the mortgage book it has inherited from Irish Nationwide (INBS) describing the asset as "low quality''.
Anglo wants to sell the book in the "medium term'' as part of its overall attempt to shrink its own balance sheet. The INBS loan book is worth €1.94bn, with €1.4bn in ordinary residential loans and the rest mortgages held by buy-to-let investors.
Arrears on the loan book are described as "well above'' market norms reflecting the low quality of a book built up at the tail end of the boom. It was subsequently impacted by the collapse of the Irish economy.
Anglo, now known as IBRC, wants specialists to advise on the book and how it might be administered more ecnomically. At present 46 staff are handling the loans, although some outsourcing of the service has been undertaken.
Anglo has committed to keeping the INBS mortgage operation as a stand alone. "New and further advances no longer take place with the focus on winding down the book in anticipation of a potential sale."
In material sent to potential expert firms Anglo acknowledges that managing the assets will continue to be difficult. "The organisiation faces ongoing challenges in a market which continues to deteriorate both in terms of property values and general economic environment,'' the bank states. Anglo never did mortgage lending itself and only took on the INBS book in July 2011.