Permanent TSB first-half loss more than doubles

Permanent TSB has reported a first-half loss of €431 million, more than double the €171 million announced a year earlier.

The bank recorded a €380 million net loss on deleveraging and a €52million loss on the repurchase of contingent convertible capital notes from the State.

The lender, which earlier on Tuesday announced a redress programme for more than 1,300 mortgage customers, said it recorded an underlying profit of €1 million - the first such profit since 2007- and an improvement of €172million over the same period in 2014.

The group’s core bank - the Irish retail banking business - reported a profit before exceptional Items of €9 million.

Permanent TSB said total assets declined from €36.3 million to €33.7 million in the first half.

The bank reported a €380 million net loss on deleveraging and a €52million loss on the repurchase of contingent convertible capital notes from the State.

Group impairment charges reduced by €125million from the first half of 2014, while total operating expenses declined by €34 million to €147million.

Net loans to customers totalled €22.9billion at the end of June, down €4.3 billion as a result of the sale of €1.5 billion of Irish loans and £2.5 billion of UK mortgages. The loan-to-deposit ratio reduced to 122 per cent from 138 per cent.

Mortgage arrears of 90 days or more reduced by 14 per cent for home loan customers and 18 per cent for buy-to-let mortgage holders.

Customer deposits have fallen €0.8 billion to €19.6 billion.

In terms of new business, Irish retail deposits reduced marginally by €0.2billionn to €11.4billion, while current account balances grew to €2.7 billion from €2.6billion .

New mortgage lending was up 5 per cent to €187 million from €178 million.

"These results show we are making progress in returning the group to sustainable profitability. We delivered a further improvement in our underlying financial performance in the first half of 2015. The group reported a small pre-exceptional profit for the period which is a significant milestone and augurs well for the future," said chief executive Jeremy Masding.

“There is still a long way to travel but we are making good progress in delivering innovation and strong competition to the Irish retail banking market and a sustainable, profitable, attractive banking business for our shareholders,” he added.