20,000 Bank of Ireland customer accounts on payment breaks

The bank initially approved around 106,000 three month payment breaks 

Bank of Ireland said the number of customers availing of a payment break has reduced as payment breaks expire. Picture: Collins Courts

Over 11,000 Irish customer accounts with Bank of Ireland remain on payment breaks, of which 6,400 are mortgage accounts.

A further 2,800 belong to SMEs, while 1,900 are consumer accounts. The total value of these loans is €1.9 billion.

The number of accounts on payment breaks makes up 5% of the bank’s Irish portfolio, slightly more than in the UK where accounts on payment breaks represent around 3% of the bank’s portfolio there. 

In total, 20,000 customers accounts in the UK and Ireland remain on payment breaks, representing 8% of the banks portfolio. 

Bank of Ireland said the number of customers availing of a payment break has reduced as payment breaks expire.

The group initially approved around 106,000 three month payment breaks in Ireland and the UK. Just 27,000 availed of a further three-month extension.

For customers that have come off payment breaks, the significant majority have resumed principal and interest repayments, the bank said, adding that the number of customers requiring additional support is in-line with expectations.

The figures were released in a third-quarter trading update from the bank today, which saw “generally better trading conditions” than quarter two.

Francesca McDonagh, Bank of Ireland Group CEO, said business volumes and activity in Ireland improved this quarter. Picture: RollingNews.ie

Francesca McDonagh, Bank of Ireland Group CEO, said business volumes and activity in Ireland improved this quarter, including a 30% increase in Irish mortgage drawdowns compared to the second quarter of 2020.

"We also experienced improved business activity in our UK business, including Bespoke mortgages where drawdowns doubled quarter on quarter," she said. 

"While there has been improvement in the third quarter, recently announced COVID-19 restrictions by the Irish and UK governments combined with Brexit present continued uncertainty. Against this backdrop, our capital position remains strong," she finished. 

Flexibility needed 

Yesterday, Ireland South MEP Billy Kelleher called on the European Central Bank to allow banks "the necessary flexibility" to support their customers, including by providing mortgage moratoria or deferrals. 

“In recent weeks the European banking supervisors have begun to phase out the flexibility they afforded European banks in what seems to be a response to improvements in the banking sector as European economies partially re-opened," the Fianna Fáil MEP said.

Earlier this year, the European Banking Authority introduced guidelines for "blanket" loan payment breaks due to the Covid-19 pandemic. However, last month it advised banks to return to offering payment breaks on a "case-by-case" basis. The Central Bank has supported this "individually tailored" solution for customers.

Ireland South MEP Billy Kelleher has called on the European Central Bank to allow banks "necessary flexibility." Picture: Leah Farrell/RollingNews.ie

MEP Kelleher said whilst he understood such provisions could not be extended indefinitely, "the unpredictable and evolving situations of mortgage holders must be taken into account."

"They must be given due time to get their finances in order and SMEs must be given the credit they need to see them through these difficult times." 

"Many Member States are now facing a second wave and it is only right and proper that banks continue to be able to offer solutions to mortgage holders who have lost income as a result of the Covid 19 pandemic and economic lockdowns," he said.