The chief executive of Permanent TSB has told the Oireachtas Finance Committee that loan sales are a legitimate tool for banks to use to reduce non-performing loans.
He added that such sales are the least worst alternative.
Jeremy Masding is before the Finance Committee for the third time to discuss the sale of the bank's Project Glas loan portfolio to Start Mortgages, an affiliate of Lone Star.
He asked the Finance Committee where the "tsunami of repossessions" - forecast by the sale of the non-performing loans - are.
Project Glas was launched to the market in February, binding legal contracts were signed at the end of July and the transaction is due close before the end of the year.
Permanent TSB had originally identified €4.8 billion of NPLs for potential inclusion in the sale.
Mr Masding told the Committee today that a rigourous set of principles was developed to ensure a fair and consistent process was followed; this included a specific set of exclusion criteria.
As a result, €2.6 billion of loans - some 48% - were excluded from the sale.
He said loans linked to over 13,800 homes have been restored to performing status "thanks to the hard work of both the relevant customers and the bank".
"Project Glas is just one of numerous loans sales which have already taken place in this country in recent years', Mr Masding said in his opening statement to the committee today.
"Yet where is the so-called tsunami of repossessions which is forecast with such certainty by the same commentators? Where are the thousands of customers finding that their terms have been altered once their loans have been sold? Where are the examples of the Courts allowing new owners to renege on pre-existing contractual commitments?" he asked.
The bank chief also said that debt forgiveness was not an option for the bank because "it creates an intolerable situation where the bank would effectively have to choose between similar customers as to who it should favour and who it should penalise".
Sinn Fein's finance spokesperson Pearse Doherty reacted angrily to Mr Masding's accusation that commentary surrounding the sale of non-performing loans by Permanent TSB to an affiliate of Lone Star as "inflammatory'.
Deputy Doherty said the most inflammatory statement that people got was the letter telling them that the bank was selling their mortgage.
"AIB is not selling family homes. Bank of Ireland is not selling family homes. No other bank is doing what you are doing," he told the Permanent TSB chief.
Mr Masding said he described Project Glas as the least worst alternative.
He said the buyers of the loans have been clear that they will continue to honour the long term treatment of customers as provided by Permanent TSB.
Fianna Fáil's finance spokesperson, Michael McGrath asked Mr Masding if there was any flexibility in removing some loans from the transaction, if they are now performing loans.
Mr Masding said the bank had entered into an agreement with the purchaser, Start Mortgages, at the end of July, and they cannot remove any loans from the transaction.
Equally, he said, no loans that have been classed as non-performing since 31 July, will be included. "That's the market convention," he said. "That's the market practice."
Eamonn Crowley, Chief Financial Officer with Permanent TSB, confirmed that the transaction will be completed by the end of November. He said the next communication that affected customers would receive from the bank will be after the transfer date to inform them that their loan has been transferred.
Mr McGrath asked Mr Masding if it was necessary to include non-performing loans that were on their way to be reclassified as performing.
"I'm not talking about the mortgages where nothing has been paid for several years, I've no sympathy for those cases," Mr McGrath said.
He said there are loyal customers who have engaged with the bank and entered into restructuring arrangements, who feel very aggrieved.
He asked could the bank not have given them more time to be reclassifed.
Mr Masding said Start Mortgages are obliged to honour agreements made with Permanent TSB at the date of transfer. "We spent a lot of time trying to get the maximum number of exclusions that we could, so links to principal dwelling homes which are performing in line with an agreed restructuring and not connected, they are not in Project Glas."
"Words are meaningless," Mr Masding said, "but let me say them anyway. I can try and empathise. At the end of the day, we have a non-performing loan ratio which makes the bank quite risky for Ireland.
"As the Governor of the Central Bank said last week, it's important that that risk gets diluted and potentially transferred.
"I have a duty to all taxpayers. I'm trying to balance all the different parts, and I'm comfortable that the team is doing that."