By Eamon Quinn
The chief executive of Permanent TSB has said that he has every confidence in the future of the Government-owned mortgage lender, as it pledged to go ahead with its sale plan for €3.7bn of troubled loans. That plan has aroused deep criticism.
Outlining details of the so-called Project Glas, which consists of €2.8bn in residential mortgages and buy-to-let loans, and, even more controversially, €900m of so-called split mortgages, Jeremy Masding said that although at an early stage, the sale plan was part of the strategy to return the bank to a sound financial footing.
The loans sale and a similar, tentative plan by fellow State-owned bank, AIB, have been attacked by politicians and debt advocates, who say the Irish banks haven’t done enough to strike sustainable deals with their customers, 10 years after the onset of the financial crisis.
They are accused by critics of being too ready to offload troubled loans to vulture funds — who currently control around 10% of the residential loan market here — and who will seek to again offload what are long-term mortgage commitments in a few years’ time.
But Mr Masding told reporters: “We launched a strategy a few week ago. We are executing that strategy”, adding that working within legislative and regulatory constraints, “at this point of time, the plan is the plan. We are going to execute the plan.”
Mr Masding said that consumer protections for Permanent TSB customers would “travel” to whoever bought the loans.
On the significance of Project Glas and the long-term viability of the lender, Mr Masding said: “I would make the case that PTSB is a really good and important institution for the Irish economy.”
He said that its branch network was “embedded” in communities and helped drive the mortgage market.
The bank cut the NPLs on its loan books by €500m last year, and by €4bn in the last five years, but 26% of its loan book is still classified as non-performing.
It insisted it had used all available tools to reduce the NPLs, including 13,700 “cured and performing” home mortgages, which represented “a huge success for families, as well as the bank”.
It had an increased share, of over 12.5%, of the mortgage market last year.
Reporting of full-year pre-tax profit of €52m for 2017, it said it will continue to boost profitability.
On its part in the industry’s tracker scandal, Mr Masding said that, amid the enforcement investigation by the Central Bank, it had offered all its customers redress and compensation, though not all had accepted the offers.