Business Irish

Wednesday 25 April 2018

PTSB fires starting gun on €1.5bn 'Project Glas' loan sale

PTSB chief Jeremy Masding
PTSB chief Jeremy Masding

Gretchen Friemann

PERMANENT TSB has fired the starting gun on the sale of what is understood to be €1.5bn of soured loans, as it races to clean up its balance sheet.

In a statement, the 75pc State-controlled lender headed by chief executive Jeremy Masding said it had instructed advisers EY to formally launch the sale of loans, bundled up and dubbed Project Glas.

The sale includes buy-to-let mortgages but not private home loans. The number of loans in the auction was cut after the bank reached a deal with 1,000 buy-to-let investors who were unable to keep up with their mortgage repayments, as reported by the Irish Independent.

The voluntary surrender initiative means landlords who have fallen into arrears agree to hand back the property to PTSB, in exchange for a write off of any shortfall on their debt.

The bank said it will "progress the sale of these properties into the market place" but stressed tenants will remain in residence.

It is understood the bank is also considering selling some vacant properties to the Irish Mortgage Holders Organisation, which is run by the debt and housing activist David Hall.

In a statement, PTSB said it had held discussions with "relevant parties about the potential use of vacant properties which are now in its possession". The bank said that up to 1,000 customers may be eligible to avail of so-called mortgage to rent arrangements - whereby properties in arrears are taken over by housing agencies and rented back to the original borrower.

PTSB's non-performing loans account for 28pc of its overall loan book, the highest ratio among the domestic banks.

While more than half of these soured exposures, totalling about €5.7bn, are in some form of forbearance or restructuring, PTSB has long indicated it would consider a portfolio sale to ease its NPL burden and appointed advisers to prepare a portfolio for sale last year.

The formal sale launched yesterday comes as AIB pursues a similar path, with a €3bn-plus portfolio of soured mortgages and loans. Indicative bids for AIB's Project Redwood were submitted at the end of last month including from Cerberus, CorVal, Deutsche and Goldman Sachs.

Irish Independent

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