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Bad-loan court actions soar as banks focus on recovering debt

IRISH banks have launched almost 100 high court actions since the start of the year as the deepening recession drives an even greater focus on debt recovery.

Court documents show that 11 Irish banks have filed 95 High Court lawsuits since January 1. The bulk of the cases are understood to involve multi-million euro commercial loans.

Bailed-out AIB and Bank of Ireland have filed 27 cases each, while Ulster Bank has kicked off 19 actions and the ACC has 11.

A spokeswoman for Bank of Ireland said the lender has "always vigorously pursued customers for debt recovery. Going down the legal route is a final option for us".

She declined to give any breakdown of the split between commercial debt and private debts, such as mortgages.

A spokesman for AIB also declined to comment on debt recovery activities.

"You mightn't see this number every fortnight, but realistically you can expect to see an upward trend in cases this year," said one banking source. "It's just the nature of the way the economy has gone."

Sources said the bulk of the cases would be commercial rather than personal debt and mortgages, pointing to the banks' efforts to reschedule mortgages in line with a new Central Bank code.


Irish Nationwide Building Society has launched just five cases since the start of the year, while Anglo Irish Bank has just one. Both institutions have already transferred vast swathes of their loan books to the National Asset Management Agency.

Other banks filing suits in 2011 include Bank of Scotland, Danske (trading as National Irish Bank), KBC, EBS and Permanent TSB, which all have one new case listed.

The flurry of activity follows a particularly litigious 2009 and 2010 as banks took scores of high profile cases against developers such as Paddy Shovlin and John Fleming.

Irish Independent