IRISH LIFE & Permanent (IL&P) is planning to cut 70 jobs at CHL, the company's British buy-to-let mortgage business - or 40 per cent of its 175 staff - as it has ruled out taking up new mortgage lending in Britain next year.

CHL Mortgages said in a statement that there would be no new mortgage lending in 2009 as the company focused on managing its existing loans to maximise profits.

A spokesman for IL&P said: "The CHL business closed to new business in March of this year and we don't anticipate opening to new customers through 2009."

The job cuts are primarily in the company's sales and marketing divisions.

Bob Young, managing director at CHL, said in a statement: "We need to restructure our business in light of current market conditions and to be well placed for the business opportunities that lie ahead. We regret that we have to reduce staff numbers but in the current market, we simply have no alternative."

The British buy-to-let business, which has mortgages of £6.6 billion (€8.3 billion), accounting for a fifth of IL&P's €41 billion loan book, laid off 50 staff in March as the property market suffered further declines and the credit crisis continued to worsen.

Analyst Scott Rankin at Davy stockbrokers said in a research note that it expects CHL loan book to decline by 10 per cent to £6 billion in 2009 as mortgages are paid. "The outcome could be lower than this, depending on how redemptions fare," he said.

He said he expected Permanent TSB's loan book to decline by 2 per cent next year, following growth of 4 per cent this year, though he added that the bias on these estimates was "downwards".

Arrears on IL&P's British buy- to-let loans rose to 0.77 per cent of all loans at the end of June from 0.4 per cent at the end of last year, below average figures for the mortgage industry provided by the Council of Mortgage Lenders.