Some 2,000 PTSB borrowers in arrears to sell property
Bank says 26 per cent of 25,000 in arrears have been ’offered treatments’
Mr Masding said the bank seeks restructured mortgages to be repaid by the time the customer reaches the age of 65. He said “trade-down” of home at this time was a legitimate request and he preferred not to extend loans post-retirement.
Sinn Féin TD Pearse Doherty said there were computer generated letters being sent by the Permanent TSB to customers asking for the voluntary surrender of property over mortgage arrears of just €300. “There is a heavy concentration on getting people to surrender their properties,” Mr Doherty said
Mr Masding responded that he was not aware of this issue. Mr O’Sullivan said there was a “legacy book” of customers for many years on a moratorium who might seem in arrears only a few hundred euro in arrears but this was very different in reality with no sustainability in the mortgage.
Document: PTSB presentation
Fine Gael TD Regina Doherty asked if borrowers who thought they were compliant could be getting letters telling them they had no choice but to sell their home. “That is correct, we are moving from repeatedly offering short term treatments to trying to offer options in the long term” Mr O’Sullivan said. Such letters were never sent without a conversation in advance, he said.
Fianna Fail senator Thomas Byrne said while the bank was exceeding Central Bank targets, in over a third of solutions it was asking borrowers to leave their home or engage in legal proceedings. “You are doing better than the Government asked you to....we are criticising the banks” but the Government set these targets for the banks, he said.
The bank said it stood over a constituency case outlined by independent TD Stephen Donnelly in which a customer would have to default on a credit union loan to repay their split mortgage resulting in the borrower having to drop out of their college degree. “I would stand with that letter” Mr Masding said. “Customers have to make a choice about prioritisation of debt” Mr O’Sullivan said.
Mr Donnelly said the reply was “deeply disappointing”. If people were being forced to leave university to pay the split mortgage that is “bad for the country” he said. “While you are meeting the targets, the consequence of meeting targets is to the detriment of Irish citizens and economic recovery,” Mr Donnelly said.
On Priory Hall Mr Masding said PTSB would take a similar view to AIB and work with mortgageholders towards a “sustainable solution” in a “very sad” and a “unique” case.
The bank’s approach to the meeting was welcomed by committee members, Mr Masding dispensed of the opening statement to make more time for questions and provided three slides to members outlining how it has provided treatments for mortgage arrears.
Committee chairman Ciarán Lynch said he would write to the other banks seeking their figures to be compiled in a similar manner before Central Bank Governor Patrick Honohan meets the committee later this month.
The committee hearing today was the last of its hearings with the four main lending Irish banks. Earlier in the week it heard from Bank of Ireland, Ulster Bank and AIB. Figures from the four banks show that they had sent 14,721 legal letters and 2,439 requests for voluntary surrender, Sinn Féin TD Pearse Doherty said after the meeting today.