Permanent TSB Transfers Non-Performing Mortgages to Vulture Fund
Dublin: Permanent TSB (PTSB) has transferred 1,244 non-performing mortgages to a Vulture Fund. These mortgages, covering 1,489 properties, are over €71,000 in arrears and have not been repaid for 22 months.
This transaction involves approximately €348 million worth of loans. PTSB announced that an agreement has been reached with Public Sector Bank and Mars Capital regarding this transfer.
The bank assured that regulatory protections under the Consumer Protection Code (CPC) and the Code of Conduct for Mortgage Arrears (CCMA) will still apply after the sale.
Six-Month Grace Period for Mortgage Holders
PTSB clarified that mortgage holders will have a six-month period to repay the arrears even after the sale. During this time, interest rates and other service charges will continue as if the mortgages were still with the bank.
After this period, the mortgages will be fully transferred to Mars Capital. This sale is part of an arrangement managed by Apollo Global Management.
PTSB will notify all affected mortgage holders in writing and has published a list of frequently asked questions on the bank’s customer support hub.
Transferring Dormant Mortgage Accounts
The bank stated that 83 percent of the involved loan accounts are non-performing, while the remaining are non-performing mortgages that do not meet repayment terms.
Approximately 70 percent of the transferred loans are tracker or fixed-rate mortgages, with the rest being variable-rate. These include 925 owner-occupied loans and 319 buy-to-let mortgages.
Strengthening the Bank
The sale is expected to enhance PTSB’s capital and lending capacity. The bank’s Common Equity Tier 1 (CET1) ratio is projected to increase by 35 percent, and the capital ratio by 45 percent.
Additionally, the bank’s Non-Performing Loan (NPL) ratio will drop to 1.7 percent, slightly below the European average.
Bank CEO Eamonn Crowley stated that the sale was necessary because retaining non-performing loans would hinder the bank’s ability to issue new loans.
Mars Capital, active in the Irish market since 2015, has a team of 300 people in Dublin and manages over eight billion euros in assets.
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