Permanent TSB chief executive apologises to customers

THE NEW chief executive of Permanent TSB is writing to more than one million customers apologising for past mistakes and saying that the bank’s €4 billion Government bailout “could have been used much better elsewhere”.

Jeremy Masding, the UK banker appointed in February, is saying, in a letter being sent to customers over the coming weeks, that he is determined to rectify these mistakes.

“As a result of some of the bank’s decisions and actions, the Irish taxpayer has had to invest substantial funds when those funds could have been used much better elsewhere,” he writes.

“Many of the bank’s customers have suffered financially because of the impact of decisions which should not have been taken. I apologise for the mistakes which were made and I am determined to do all in my power to rectify them.”

Mr Masding said that the bank, which is 99.2 per cent State owned, would “act responsibly to protect the investment which the taxpayer has made in the bank”.

A spokesman said Mr Masding felt it was critical at the outset to acknowledge the bank’s unacceptable performance in recent years and “to apologise to taxpayers and customers for the mistakes”.

The Government effectively nationalised Permanent TSB last year by injecting €2.7 billion following last year’s stress tests of the banks. A further €1.3 billion will be raised through the Government’s purchase of Irish Life.

The troika and the Government approved a plan last month to carve a good bank out of Permanent TSB by moving about a third of its €34 billion in loans to an internal bad bank to be run down.

Minister for Finance Michael Noonan has said that Permanent TSB has the potential to become a “third national bank” to compete with Bank of Ireland and AIB.

In his letter Mr Masding says that a new, “more humble” Permanent TSB will emerge over the coming years. He said the bank would work to start lending again and help customers in arrears.

“We understand that being in arrears is stressful. We have a wide range of options available to help everyone in this situation.”

The bank would review mortgage rates regularly to ensure they were “as competitive as possible”, he said.