Permanent TSB Confirms Participation in Ulster Bank Loan Portfolio Separation Talks


The Managing Director of Permanent TSB has confirmed that the public mortgage bank wants to be involved in the dismemberment of the 20 billion euros of loan portfolios held by Ulster Bank.

Eamonn Crowley said he was “quite positive at the moment” about the progress of the talks.

He said the bank was looking to buy mortgages as well as small business loans from Ulster Bank’s parent company NatWest, adding that buying parts of Ulster Bank would undoubtedly strengthen Permanent TSB.

Mr Crowley said the permanent TSB was also interested in acquiring Ulster Bank branches as it prepared to exit the Republic market, but the bank also said negotiations were still at a point. early stage.

the fallout from covid

It comes as the permanent TSB showed the fallout from the Covid-19 economic storm.

It recorded an underlying loss of 109 million euros for 2020 against a profit of 74 million euros in 2019 and published an after-tax loss of 162 million euros, against a net profit of 30 million euros. euros the previous year.

The bank said it returned to profit in the second half of 2020.

The bank has a loan portfolio of around 15.8 billion euros in mortgage loans but has wanted for some time to develop in lending to small businesses, or SMEs. It said it has kept all of its 76 branches open during the pandemic.

On Ulster Bank loans, Mr Crowley said he was in talks to acquire “certain assets, liabilities and retail and SME operations”.

“Until an acquisition is finally closed, there can be no certainty that an acquisition will occur or under what terms,” ​​said Mr. Crowley.

Market dominance

The government has mobilized the permanent TSB along with other AIB state-owned companies in recent weeks to buy a large chunk of Ulster Bank loans after NatWest announced it would exit the banking market, a move which it claims banking experts, will further strengthen the dominance of the big two – AIB and Bank of Ireland.

The government owns 75% of Permanent TSB and some banking experts have said the state could likely support the bank by helping it acquire parts of Ulster Bank, possibly with outside investors, by pumping more money into the lender.

Like all Irish banks, Permanent TSB has been hit hard by the pandemic but is among the weakest in terms of financial health.

Its net interest margin – a key measure of profitability for lenders – fell to just 1.73% in 2020.

“Despite the challenges that 2020 has brought, I am confident that the bank is in a strong position to make the most of the opportunities that will arise in the post-pandemic recovery phase,” Crowley said.

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