Ulster Bank's chief executive Jim Brown has said that the Central Bank's recent announcement on mortgage lending restrictions could prevent many first time buyers from getting a foot on the property ladder.
Mr Brown said he recognised the Central Bank's need to intervene to avoid things overheating.
But by his estimations, 68% of Ulster Bank's first time buyer customers would not met the new proposed Loan To Income criteria, he added.
Appearing before the Finance, Public Expenditure and Reform Committee, Mr Brown also said that 8,000 Ulster Bank customers who had been in arrears, are now up to date in their mortgage repayments.
Mr Brown added that Ulster Bank expects to invest around €500m in terms of mortgages this year and is making efforts to keep customers in mortgage arrears in their own homes.
The bank CEO said the bank had 500 people working with customers in arrears - which he said is quite a high level.
He said that many of the 4,600 people in court proceedings have been over a year in arrears and have still not engaged with the bank.
Mr Brown said that court proceedings is a last resort for Ulster Bank and it "still had staff on the court steps encouraging people to re-engage".
He also said the recent announcement by its parent company Royal Bank of Scotland about Ulster Bank marks a key commitment and indicates the bank's strong potential.
Ulster Bank was fined €3.5m by the Central Bank yesterday over for IT failures that affected 600,000 customers in the summer of 2012.
Mr Brown told the committee today that the bank's IT system had been replaced and RBS has invested €750m in upgrading the system, ensuring a back-up system is in place and making sure that Ulster Bank transactions can be run independently of the other banks in the RBS Group.
He also said that governance has been improved and PwC has been brought on board to supervise, adding that a huge amount of work had been done.
Fianna Fail's Michael McGrath said he was disappointed with the questionnaire submitted to committee members by Ulster Bank, criticising Ulster Bank's "minimalist approach in terms of information".
Deputy McGrath said it was the worst questionnaire submitted by the banks.
Mr Brown said that there are a number of questions the bank did not answer for commercial reasons. He said that he had shared that the cost of funds was in and around what the other banks pay.