The 75% State-owned bank took a loan impairment charge of €155 million.
PERMANENT TSB HAS reported a pre-tax loss of €166 million for 2020.
Published this morning, the bank’s full-year results also reveal that total new lending was down 15% to the end of last year to €1.4 billion while new mortgage lending was down 14%.
Meanwhile, PTSB, which is 75% State-owned, held a roughly 15.3% share of the mortgage market in 2020, largely unchanged from 2019 when it also reported a pre-tax profit of €42 million.
The bank took a €155 million loan impairment charge last year in anticipation of an increase in Covid-related loan defaults. The value of non-performing loans on PTSB’s books rose by €80 million, the bank said, increasing the ratio of problem loans to performing ones by 7.6%.
This increase is largely due to a “reduction in gross loans”, relating to a loan sale, which was completed during the financial year, the bank said.
PTSB also took a €31 million charge in 2020 relating to a restructuring programme announced last November, which will see the lender cut its workforce by 300 and review its property portfolio.
Today’s results show that PTSB agreed to Covid-related mortgage payment breaks last year with 10,700 customers, who owed a total of €1.6 billion, 10% of its total loan book. By the end of the year, 99% of those payment breaks had expired.
“While 2020 was a loss-making year for the Bank, the second half of the year saw the bank increase its new lending volumes and transactional activity as the economy began to reopen,” said chief executive Eamonn Crowley.
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“Our active mortgage offer pipeline is at a strong level and positions us well to continue our strong performance into 2021.”
Commenting on reports that PTSB is line to take over part of Ulster Bank’s business in the Republic of Ireland, after the NatWest-owned lender exits the market here, Crowley said, “We have ambitious plans to grow our position in the Retail and SME markets in Ireland and support customers and communities across the country.
“In line with that ambition, the bank is in early discussions with NatWest in relation to acquiring certain elements of the Ulster Bank businesses in the Republic of Ireland. This includes certain retail and SME assets, liabilities and operations.”
However, he added, “Until an acquisition is finally concluded there can be no certainty that an acquisition will occur or on what terms. Any such transaction would be subject to normal shareholder and regulatory approvals.”