The boss of Permanent TSB (PTSB) said the mortgage lender is weighing a decision on home loans and will make a judgement in the near future.
The comments came on the same day ECB head Mario Draghi all but said the central bank would cut rates and boost its stimulus for the flagging eurozone economy at its September meeting – although which of its wide range of interest rate cuts it has at its disposal will determine if Irish mortgage borrowers automatically tap any immediate benefits.
PTSB chief executive Jeremy Masding told reporters the lender was not making any specific announcement on mortgage pricing as it unveiled earnings for the first half of the year but said it anticipated making an announcement “shortly”.
He hailed “an impressive performance” for the lender to secure a 14.7% share of mortgage drawdowns in the first half — up from 13.8% at the same stage a year earlier but compared with the 15.1% share it posted for all of 2018. Amid continuing huge housing shortages, Mr Masding said “a lot” of its credit-worthy customers were struggling to find a property on which to draw down their approved mortgages.
“Whilst the mortgage market has become very competitive, we have preserved price discipline and made process improvements to deliver a better customer experience,” Mr Masding wrote in the bank’s formal earnings announcement. Its shares rose 1.5% but have fallen 39% in the past year to value the lender at around €553m.
Net profit in the first half for the 75%-Government-owned lender fell to €21m from €56m a year earlier, reflecting a fall in net income following its sale of non-performing loans and a €14m charge driven by restructuring costs and including a contribution to help cover the cost of the €21m fine the Central Bank slapped on PTSB for its part in the industry-wide tracker mortgage scandal.
The lender said it was at “a major turning point” and was investing in technology to help it better compete in the Irish market, build the bank and boost value for its owners and investors, despite facing significant headwinds that an ECB rate cut and hard Brexit could entail.
The bank has around €1.7bn of loans, or 10% of the total loan book, which are non-performing – a higher level than most of its rivals. Mr Masding said the NPLs would fall to “mid-single digits in the medium term”, but without specifying the stages it would move toward reaching the target.
The lender also said it generated €12m in net other income from gains on the sale of properties it held in possession.