Business Irish

Thursday 19 September 2019

PTSB agree complex deal to shift €1.3bn of mortgages from bank into 'securitisation'

More than 6,000 borrowers affected; almost all debt is secured on the borrowers' primary homes

Photo: Collins
Photo: Collins
Donal O'Donovan

Donal O'Donovan

Permanent TSB has agreed a complex deal to shift €1.3bn of mortgages out of the bank and into a so called securitisation, despite the borrowers having previously agreed restructuring deals with the largely State owned bank.

All told, about 6,272 borrowers are affected. Almost all of the debt is secured on the borrowers primary homes.

It includes thousands of so called split mortgages – where the borrower and bank agreed that part of the debt would be serviced and the rest parked for an agreed period.

The bank says that the terms of the existing restructuring arrangements will not change, but the mass hand over of home-loans whose borrowers engaged with their lender after getting into arrears is sure to be highly controversial.

The bank had stripped the same loans out of an earlier loan sale, after a political back lash, however it is under intense pressure from regulators at the European Central Bank (ECB) to slash its stock of impaired loans towards the euro are average of 4pc.

Under the deal announced by Permanent TSB the loans will be managed by Pepper after a transfer date pencilled in for around six months from now.

Ahead of the new deal, 16pc of Permanent TSB’s loans were classed as impaired. It will now fall to 10pc.

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