Business Irish

Sunday 22 April 2018

Mortgage impairment charges are €400m in Ulster Bank's €24.5bn home loan book

Laura Noonan

Laura Noonan

ULSTER Bank took impairment charges of almost €400m on its mortgage book last year as the number of homeowners in arrears surged to 10,000.

The 2010 mortgage hit is about three times the impairment charge taken in 2009, reflecting plummeting property values and soaring unemployment.

But the number of homes seized by Ulster fell to 76 last year, 20 fewer than in 2009, according to data released yesterday.

"Debt forgiveness is not in our box of tools but we've been working with customers and rescheduling loans where we can," said Ulster Bank boss Cormac McCarthy.

Ulster says it has arranged "forbearance" measures in respect of 5.8pc of its €24.5bn home loans book, mostly relating to "performing" loans that aren't in arrears.

The Royal Bank of Scotland-owned bank pioneered the 100pc mortgage in the boom, and some 37pc of its book still has a "loan-to-value" ratio of more than 90pc, making Ulster particularly exposed to falling property prices.

"We've said before we don't expect mortgage arrears to top out until mid 2012 and that remains out view," said Mr McCarthy.

"We expect impairments to remain high for a minimum of six months, given unemployment levels and economic uncertainty."

Yesterday's results also show that Ulster's new mortgage lending has almost ground to a halt, with just 285 new home loans granted in the Republic last year and another 3,272 in the North.

Irish Independent

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