ULSTER BANK TO SELL OFF €1.6BN MORTGAGE LOANS
ULSTER Bank has confirmed it is selling off €1.6billion of mortgages in arrears.
It plans to get rid of 6,500 loans, of which 3,600 are owner-occupier and the remaining 2,900 buy-to-let or investment properties. They have been on average in arrears for more than three years.
Ulster Bank has started discussions with potential traders and enlisted financial advisers to manage the sale.
The mortgages are expected to be sold within the next seven months but customers whose loans are on the market will not be told until a buyer has been found. The bank has set aside €119million to deal with any loss it will incur from the sale.
It said in a statement: “This difficult decision comes a decade after the financial crisis began and the continued forbearance cannot be maintained.
“Not all mortgages are sustainable and we are obliged to reduce the level of non-performing loans.” The face value of the owner-occupier loans being sold off Ulster Bank is €900million. On average, they are in arrears of €52,000.
The buy-to-let mortgages are valued at €700million, with average arrears of €31,000.
Last night Sinn Fein’s Pearse Doherty predicted the loans will end up with vulture funds unless the sale is stopped.
The party’s finance spokesman added: “Once again we have one of the main banks in the country, one mired in controversy, announcing it is selling the loans of its customers.
“It is completely unacceptable. I have no doubt these mortgages will end up in the hands of vultures. “Government silence equals Government approval. “There are realistic options now including the mortgage-to-rent scheme, split mortgages and write downs that Ulster Bank should be looking at. “These options are being ignored.”