The new benchmarks set by the Central Bank as part of the mortgage arrears resolution targets mean that fewer than 30% of mortgage holders will have to have a sustainable solution in order for the banks to meet the targets.

As the Government seeks to turbo-charge the recovery in the Irish property market, ratings agency Fitch is predicting that the arrears crisis will continue to grow as the buy-to-let sector fuels defaults and depresses prices outside of Dublin.

A rise in the number of house repossessions is likely, in the coming quarters, as a means of stemming the strategic non-payment of outstanding home loans, Davy Stockbrokers has warned.

Ulster Bank has said it is continuing to make good progress in restructuring its core business, after seeing first-quarter declines in operating and impairment losses, a levelling out in mortgage arrears cases and a rise in customer deposits.