PTSB sells €215m tranche of loans in UK

Permanent TSB yesterday announced it had closed the sale of a €215m tranche of loans held by its UK subsidiary CHL.

PTSB sells €215m tranche of loans in UK

The sale of the loans, known as Project Liverpool, is part of the bank’s ongoing deleveraging programme of non-core assets.

While the price of the deal has not been disclosed, a PTSB spokesperson confirmed that the price achieved was 40% above the offers submitted for the portfolio in 2012 when it was previously offered for sale.

Commenting on the announcement, the spokesperson said that the sale vindicated the decision previously taken to suspend the sale process which initially began two years ago.

“The prices available in 2012 simply didn’t justify the sale of these assets at the time. The uplift in pricing which we’ve now achieved confirms that we are best placed to manage these assets out over time and in a way which secures the best return for the bank and the taxpayer,” the spokesperson said.

Having expanded its loan book during the boom years, like the other Irish banks, PTSB has been selling assets to shrink its loan book as part of its deleveraging process.

“We’re making strong progress on our core bank in Ireland and we’re complementing that by deleveraging non-core assets in the UK and Ireland. This is another significant step on that journey,” the spokesperson added.

CHL, a subsidiary of PTSB, manages a loan book of approximately €7bn of mortgages secured against buy-to-let properties in the UK. As part of the transaction CHL will continue to service the Project Liverpool loans under a separate commercial agreement.

Analysts at specialist bank Investec said that in the context of the €7bn loanbook, the sale was relatively small but added that it was a positive move by the bank.

In June, PTSB hired Morgan Stanley to sell its €2.6bn commercial real estate and subprime residential mortgage loan book to show the bank’s viability following its €4bn State rescue.

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