Bank sells off its car loans at 18% discount
State-owned Permanent TSB has sold most of the loans in the bank’s car finance and leasing division to a company controlled by German lender Deutsche Bank. The loans will be serviced by the division’s former management team.
The Deutsche-controlled company Consumer Auto Receivables Finance is buying most of Permanent TSB Finance and the bank’s unsecured personal lending business Blue Cube, which stopped writing business in 2008, as well as a small portfolio of largely corporate loans.
The two divisions are disposing of €351 million of loans for a purchase price of €287 million, a discount of 18 per cent on the book value of the loans at the end of February 2012.
The bank said it had also agreed to sell the business platform of Permanent TSB Finance to a new company called First Citizen Finance, set up by finance division managing director Chris Hanlon and other members of his management team.
The Deutsche company has entered into a contract with Hanlon’s company to service the assets acquired.