Permanent TSB is considering extending the time-frame for its sale of mortgages in arrears following the commitment by the Government to tighten regulation of so-called vulture funds which buy home loans.
The development comes as foreign funds have stepped back from activity in Ireland until there is certainty about the new legislation.
A spokesperson for the bank has declined to comment.
Fianna Fail's finance spokesman Michael McGrath has introduced legislation which would see vulture funds regulated by the Central Bank.
Last week the Finance Minister Paschal Donohoe said he would accept the bill from Mr McGrath but said there would be redrafting and amendments to the proposed legislation.
Permanent TSB has begun a sales process to dispose of 18,000 mortgages including 14,000 owner-occupier loans in arrears.
Potential purchasers have already signed confidentiality agreements.
The portfolio had an original value of €3.7bn but would be sold at a discount.
Sources have told RTÉ News, foreign private equity funds have stepped back from activity in Ireland until there is clarity about the proposed legislation.
It is understood there are concerns that the legislation as currently drafted could affect a broader category of financial activity beyond loans in arrears. It could include the securitisation of loans which is part of regular banking activity.