Ulster Bank has revealed plans to sell a further large portfolio of mortgages worth €900m which are not being repaid as they should be, or at all.
90% of the loans, or 3,200 accounts with a total value of €810m, relate to family homes, reflecting the fact that most of the bank's outstanding non-performing mortgages are now in this category.
The other 10%, or 400 accounts worth a combined total value of €90m, are for buy-to-let (BTL) properties.
The bank hopes to have a buyer in place and the sale completed by around late autumn.
It says the move follows attempts to work with the customers concerned to find a way to sustainable solutions.
"The PDH loans have been assigned to this portfolio following a concentration of effort with customers in difficulty to ensure that they were given every opportunity to agree a sustainable solution and to remain in a home that they can afford," a spokesperson for the bank said in a statement.
"For all of these customers, the continued extension of forbearance cannot unfortunately be maintained," the spokesperson added.
The move by Ulster Bank does not come as a great surprise as it had signalled it was considering another loan sale in the third quarter of last year and also more recently at an Oireachtas committee hearing.
Currently around 11.3% of Ulster Bank's loans are non-performing and it, along with all the other main Irish banks, is under pressure from the European Central Bank and the Central Bank to reduce that figure to 5%.
"Not all mortgages, PDH [Private Dwelling House] or BTL, are sustainable and we are obliged to reduce the level of non-performing loans on our balance sheet," the spokesperson said.
"For mortgages that are not sustainable, additional forbearance will not bring them back to a performing position."
In August last year the bank announced the sale of 5,200 non-performing mortgages worth €1.4 billion to so-called vulture fund, Cerberus.
The difference in that case, however, was that just 45% of the portfolio was made up of mortgages on family homes, far lower than in the current planned sale.
In the current portfolio, the average arrears on the private dwelling house (PDH) loans is €33,000, while on the buy-to-let properties it is higher at €36,000.
But when it comes to the average period that the loans have not been performing, in the PDH category it is 75 months, compared to 53 months for the buy-to-lets.
We need your consent to load this rte-player contentWe use rte-player to manage extra content that can set cookies on your device and collect data about your activity. Please review their details and accept them to load the content.Manage Preferences
On average, the customers whose family homes are included have been in five forbearance arrangements and have been in arrears for 58 months.
40% entered arrears over seven years ago, and none of these loans are in a repayment arrangement.
According to bank sources, it has undergone an intense period of engagement with customers still in arrears over the past 12 months, in an effort to find a sustainable solution for them.
Four out of every five customers who engaged with the bank have received an offer of a solution they can cope with.
But in the case of the other one in every five, a sustainable arrangement could not be found or the customer was not willing to engage.
Once the sale is complete, Ulster Bank's non-performing loans will be down close to the 5% of its total book sought by regulators.
Fianna Fáil criticised the move and said the Central Bank must use the powers it has been given by the Oireachtas to regulate previously unregulated loan owners.
"Fianna Fáil believes that mortgage holders who are making a genuine effort and are paying what they can should be protected and kept in their home," said finance spokesperson, Michael McGrath.
"The number one priority of the regulators seems to be to protect the health of the banks. They have little concern about what happens to the customer once their loan is sold on by a retail bank within their remit."
While Sinn Féin's Pearse Doherty said the planned sale is unacceptable.
He claimed the political support of government allows banks to get away with these sales.
The Irish Mortgage Holders' Organisation warned the result of the sale for many would be homelessness.
"This is an additional homeless tsunami that's coming," said the IMHO's David Hall.
"These are people and families, not just numbers. 3,200 accounts with an average of 3.5 persons living in each home, having not been able to maintain restructured payments, means 11,200 people will be homeless. The future for the 400 buy to let tenants is also uncertain."