PTSB to be called before finance committee

Permanent TSB is to be called before the Oireachtas finance committee to answer questions on the potential sale of 18,000 loans to vulture funds.

PTSB to be called before finance committee

Finance Minister Paschal Donohoe has said he “cannot influence” banks or ask them to hold off on selling distressed loans until after the Government reviews the current status of unregulated vulture funds now operating in Ireland.

Appearing before the finance committee, Mr Donohoe said it is vital that PTSB reduce the number of non-performing loans (NPLs) on its books by selling 18,000 mortgages, including 14,000 relating to private homes.

“It’s vital across the coming period that a way be found that the NPLs that that bank had and other banks have be reduced if we want to have a safe and secure banking system,” said Mr Donohoe.

Fianna Fáil TD John McGuinness asked that the Minister insist that the banks “at least hold off on their sales until such time as these regulations and the legislation are actually reviewed”.

However, Mr Donohoe said the single supervisory mechanism has issued a direction to PTSB to sell off some of its non-performing loans and the bank is following this.

“I don’t have the power available to me to intervene in the compliance with that regulation or its timing. I cannot influence, because of the fact that we are dealing with an independent regulator, how a bank responds back to how a bank responds back to their timing.

“But what I can do is influence what I can directly control and if I believe that there are some changes that are needed that require legislative or regulatory change, yes my objective would be to have them implemented as soon as possible.”

But he added: “We are talking about a bank that has non-performing loans. We need a stable and secure and successful Permanent TSB in Ireland.”

Mr Donohoe has come under pressure from Fianna Fáil, which has drafted a bill to address and regulate vulture funds operating in Ireland. The bill is due to come before the Dáil next week. He has also faced intense questioning from his own party this week, many of whom believe struggling mortgage holders must be offered debt write-downs instead of so-called foreign vulture funds.

Mr McGuinness suggested that the sale of PTSB’s €3.7bn Project Glas loan portfolio would be the first of many sales. “PTSB has 14,000 homes, AIB is lining up for some sort of sale also, and we know from the exchanges here with other banks that they too are lining up and that there will be issues now for homeowners.”

Mr McGuinness said the committee had sent a formal invitation to PTSB to appear before the committee next Tuesday to discuss the makeup of the loans, the length of time people have been in difficulty, and the efforts they have made to solve these difficulties.

Mr Donohoe said banks should come before the committee “to answer questions that you may have”.

“I understand there may be a number of banks that will be producing results soon and for legal reasons they may not be able to comment publicly on matters in the period just before they publish their results.

“But I believe the banks should accept your invitation and should explain and should provide answers to the various questions that you have.”

More in this section