The board of Permanent TSB has faced questions regarding significant reductions in benefits for members of its pension scheme at its Annual General Meeting.

Former staff member Mary Nugent asked why Permanent TSB workers received a letter of comfort in 2007 "which assured us our pensions would be safe and why is the bank not honouring that letter?"

The bank's chairman Alan Cook said that the changes to the pensions were the "least painful" option facing the bank.  

"The alternative would be much more severe that what we have today," he said

Another shareholder said she felt the bank's staff "had not been treated fairly."

Trustees of Permanent TSB defined benefit pension scheme are winding it up after the bank stopped contributing to it.

Some members of the scheme will lose up to half of their benefits, according to trade union Unite.

Mr Cook faced a series of protests from shareholders who were angered at the step by the Government to take full control of the bank which wiped out existing shareholders.

One shareholder, John Lanigan, claimed that State had "raped" the shareholders.

He added none of the predictions made by the State when it took control of Permanent TSB had come true.

Mr Cook told the meeting "we've made a good start to the year - and are now competing strongly in our key markets."

Earlier Permanent TSB said the amount of money it needs to write off due to mortgage defaults will fall significantly in 2014 compared to levels seen in the past two years.

In a trading statement ahead of the AGM, the bank said total mortgage arrears are now 10% below peak levels hit last year.

The number of mortgage approvals is up 80% so far this year compared to the same period last year, albeit from a low base.

Permanent TSB said its share of mortgage draw downs is 13% compared to a historic low of 1.6% during the fourth quarter of last year.