Ulster Bank plans to offload a third of its mortgages

The company is looking to sell off as many as 7,000 loans in arrears.

By Fora Staff

ULSTER BANK’S OUTGOING chief executive has said the company could sell as many 7,000 mortgages in arrears.

The news came as the bank reported an operating loss of €151 million last year and also amidst the controversy over Permanent TSB’s plans to sell around 18,000 loans.

Outgoing CEO Gerry Mallon told RTÉ’s Morning Ireland that there is a possibility that these mortgages in arrears could be sold to foreign funds.

Mallon said the bank was obliged by the European Central Bank to reduce the level of impaired loans.

“There are 20,000 customers in arrears, and there are a range of strategies across that. We’ve made a provision for a change in strategy rather than announcing any actual sale,” he said.

“We would see maybe a third of the total book as appropriate for a potential sale.”

Ulster Bank last year set aside €192 million to deal with “legacy conduct and litigation issues”. Some €87 million was set aside to compensate customers affected by the tracker mortgage scandal.

‘Created an appetite’

Also speaking on Morning Ireland, Sinn Féin finance spokesman Pearse Doherty said: “It’s not surprising we now have another bank talking about offloading its mortgages to potential vulture funds.”

Doherty said that the government “not standing in (Permanent TSB’s) way” created an appetite for other banks to follow suit.

He said that while the European Central Bank is clear in the need to get rid of non-performing loans, it doesn’t mean that they should be sold to the vultures.

“People who are trying to pay their mortgage repayments are thrown to the wolves,” he said.

Doherty was also critical of Mallon for not coming before the Oireachtas Finance Committee.

According to Ulster Bank’s full-year results for 2017, the company booked an operating loss of €151 million in 2017, compared to a profit of €24 million the year before.

New lending increased by 3.4% to €2.6 billion.

Written by Sean Murray and posted on TheJournal.ie