Irish state-owned mortgage lender Permanent TSB (PTSB) has appointed Deutsche Bank to advise it on its future return to private ownership, the bank said yesterday.

The majority of home-buyers will in future have to put down a 20% deposit and be able to borrow a maximum of 3.5 times their salary, according to new rules by the Central Bank.

There has been a 21% drop in customers in mortgage arrears between the start of the year and the end of August at Permanent TSB.

AIB’s better-than-forecast pre-tax profit for the first half of the year has increased expectations that it will start paying back the State’s €20bn investment sooner than envisaged.

The company taking over €250m of Bank of Ireland mortgages has applied to the Central Bank for full authorisation and intends to fully comply with all codes related to mortgage lending and arrears.

US investor Wilbur Ross has ruled out a future investment in AIB, although he is looking at other possible investments in Ireland.

Bank of Ireland is profitable and adding to its capital reserves, according to its latest interim management statement, released at yesterday’s annual general meeting.

Bank of Ireland and AIB are well-placed to pass the ECB’s comprehensive assessment of the banking system this year, according to Merrion Capital analyst Ciaran Callaghan.

Stockbrokers Merrion Capital is convinced there is a resurgence in AIB, with analyst Ciaran Callaghan issuing a note entitled ‘Phoenix rising from the ashes’.

AIB’s capital position could be boosted by roughly €160m following Nama’s decision to pay interest on its subordinated bonds.

Wanted — investors willing to pump €100m into a new European bank that picked Ireland as its first market. Strategic partners only, hedge funds, private equity and institutions need not apply.

Finance Minister Michael Noonan said the Government may seek to sell a stake in Allied Irish Bank before the country’s next scheduled election.

The appointment of Des Carville as head of the Department of Finance’s shareholder management unit could see an acceleration of the Government divestment of its stake in the pillar banks, according to Merrion Stockbroker analyst Ciaran Callaghan.

The withdrawal of banking facilities by Danske Bank is bad news for Irish consumers, but a number of international investors will take it as a sign that the pillar banks will inevitably return to profit.

Bank of Ireland said its pension deficit will narrow by an initial €400m under a plan to cut employee retirement benefits, in an accord that eases the way for the nation’s largest lender to repay part of its state bailout.

The Government and Bank of Ireland will wait until the Central Bank’s balance sheet assessment of domestic banks is completed before making a decision about the redemption of the €1.8bn in preference shares, say analysts.

The banks will not need further capital following the next round of EU-wide stress tests scheduled for 2014, according to Merrion Stockbrokers’s senior credit analyst, Ciaran Callaghan.

Tracker mortgages are costing the three domestic banks roughly €708m every year, which is a huge drain on profitability, according to research conducted by Merrion Stockbrokers.

AIB is to sell its 22.4% stake in M&T for €1.5bn, a discount of 7% to Tuesday’s value of the bank’s stake holding in the US regional bank.

BANCO Santander’s decision to turn down the option of buying AIB’s stake in M&T has increased the woes of the country’s former leading bank.

AIB’s detailed stress test figures may be a “significant blow” to the lender’s efforts to raise capital, NCB Stockbrokers said.

BANK of Ireland is to axe a further 750 staff after receiving approval from the European Commission for a major restructuring plan.

WITH the successful 95% take-up of its rights issue, Bank of Ireland may have successfully wrapped up its €3.56 billion capital raising round; but challenges still lie ahead – particularly with the international funding environment remaining tough, with term-debt markets still closed for most European banks.

BANK of Ireland, the country’s biggest lender by market value, has raised €1.73 billion in a share sale, boosting capital after losses surged.

SPANISH banking giant Santander, said to be interested in deals involving AIB’s British and US operations, could potentially be a bidder for the entire AIB group.

IRISH banks expect to be informed shortly by the Government how much capital they will need to hold as operating financial institutions.

BANK of Ireland shares plunged more than 6% yesterday, as the Government took control of a sixth of Ireland’s biggest bank by market value.

THE choice of mortgage products in the market has plunged to a record low, with analysts saying most foreign lenders are no longer interested in lending.

THE first transfer of loans from the troubled banks has fallen further behind schedule. Initially, the time-scale for the transfer of up to €19 billion of bad loans to the National Asset Management Agency was before Christmas 2009.

AS many as 250,000 homeowners on standard variable loans may soon be forced to pay out at least an extra €76.50 per month on mortgage repayments.

SHARES plunged yesterday as fear gripped the markets in one of the worst days in Irish financial history.

Fermanagh 0-14 Limerick 1-07