The Central Bank has said it is not comfortable with the high level of mortgage arrears, and wants mortgage lenders to do more to tackle the issue.
Figures published today show that last year the mortgage arrears rate rose from 6.3% in the first quarter to 9.2% in the fourth quarter.
This figure is expected to rise above 10% for the first quarter of this year, or some 75,000 residential mortgages.
A lot of these mortgages have been put on interest only deals, but Financial Regulator Matthew Elderfield said banks have to look at other ways of dealing with the arrears, such as reducing the amount of debt owed.
He has asked the banks to divide their mortgage books into cases that can benefit from interest only deals, those who need debt reduction deals, and those who cannot be saved.
He will meet each bank board soon to ask directors to personally focus on the arrears problem.
Central Bank Governor Patrick Honohan said the bank was carrying out its own survey research into mortgage holders, their income situation and their ability to repay debt.
He said an improvement in the employment situation would lead to a rapid improvement in the mortgage arrears situation.
The Central Bank will publish the arrears rate for buy-to-let mortgages later in the year, but says it is much worse than the situation in residential mortgages.
Figures to be published at the end of the week are expected to show that one in ten mortgages are now at least three months in arrears.
The Head of the Free Legal Advice Centre Noeleen Blackwell has said it is "high time" that Ireland dealt with the fact that a lot of people can no longer manage their mortgages.
Speaking on RTÉ's Six One News, Ms Blackwell said there is a total mess of over indebtedness in Ireland and it needs to be structured better.
She said banks are looking at mortgage holders on a case-by-case basis but the problem is much bigger than that.
Separately, the Central Bank made a profit of €1.2bn in 2011. Most of the profit has been paid to the Government as a dividend.
In its annual report published this morning, the Central Bank says the governor will take another voluntary pay cut this year.
Most of the Central Bank's profit of €1.2bn came from lending money to commercial banks.
After making deductions for its own expenses and retained earnings, the Central Bank will pay €958m to the Government as a dividend - up on the €720m it paid in 2010.
Mr Honohan’s net salary will be €213,000 next year, down from €234,000 last year.
The bank almost doubled the number of enforcement actions taken against financial institutions from 797 to 1,419, while the number of onsite inspections more than doubled, from 137 to 325.
