Business

Ulster Bank €2.5 billion loanbook sale includes family mortgages

Ulster Bank is trying to offload a €2.5 billion loanbook
Ulster Bank is trying to offload a €2.5 billion loanbook Ulster Bank is trying to offload a €2.5 billion loanbook

ULSTER Bank is to sell off €2.5 billion (£1.9bn) worth of distressed debt.

The sale includes 900 mortgages secured on family homes, all of which are in the Republic.

But it is understood that around £265 million of the overall debt is Northern Ireland-based.

The latest portfolio is known as Project Oyster and is 86 per cent made up by loans secured on businesses and properties from south of the border.

It forms one of the final tranches of toxic loans that formed the institution's so-called bad bank.

A spokesman for the bank said: “Ulster Bank has confirmed a significant impaired loan portfolio sale enabling the bank to strengthen its balance sheet for the benefit of its customers and much-needed competition in the banking market.”

“The loans involved do not belong to typical customers, they are all in Ulster Bank’s problem debt management unit and in arrears or under specialist management for a significant period of time."

Sinn Fein finance spokesman in the Republic Pearse Doherty responded angrily to what he called Ulster Bank's attempt to sell loans to a "vulture fund".

“If true, I am disgusted by this move from Ulster Bank especially the inclusion of family home mortgages in distress. I am calling on the bank to stop this sale," he said.

“At the very least the element of this sale which includes distressed mortgages should be stopped. I believe all political opinion can be united behind that call on Ulster Bank.

“The new law brought in so belatedly last year is not providing adequate protection to home-owners. Until it is revised all responsible Irish banks should not be selling any loans but especially ones in distress to vultures.

"We argued at the time for more teeth to be put into the law but after lobbying from vulture funds and others this was diluted.”