# ptsb in front of the Oireachtas Finance Committee now



## Brendan Burgess (5 Sep 2013)

ptsb will be on at 10 am 

*[FONT=&quot]Déardaoin/Thursday, 05/09/2013[/FONT]*
  [FONT=&quot]*[FONT=&quot]Finance, Public Expenditure and Reform[/FONT]*[/FONT][FONT=&quot] CR1, LH 2000 10 a.m. (T)(V) AGENDA: 
*Session A: 10 a.m.**
*Overview of the Financial Sector [_Mr Jeremy Masding, Chief Executive Officer, Permanent TSB_]; and

[/FONT]


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## Brendan Burgess (5 Sep 2013)

*Slide 1  - Submission to Central Bank at end of June 
*
Total treatments offered   6653   30% of 26,000 customers over 90 days

1,500 short term  23% 
2, 750  long term 
800   assisted voluntary sale 
1600  legal proceedings 

*Short term
*typically 6 months will get back 
A moratorium - no payments 
Interest only 
Interest only +
Interest - 

*Long term  41% of our total count at half year
*1,000 split
600 part capital and interest - there might be a bullet payment at the end of term 
750  interest only and capitalization - typically 3 years - 
400 term extensions 

*Closure 
*no affordability no sustainability 
no cash to pay the minimum amount required
At tend of term - no capital to pay mortgage 

*Legal proceedings 
*Our count begins when we ask our solicitor to apply to the court - just before the Civil Bill 

Legal proceedings is a "stock figure".   Includes cases where action began in 2011. (other figures are "flow" figures for first six months)

Customer not engaging - may result in repossession - 

*Slide 2  (different methodology from CB) 
*11,000 short term treatments  ( only 1,100 included in CB figures) 
5,000 long term 
1,0000 assisted vol sale
               Arrears Repayment Plan  ( a new idea) 

We believe short term treatments are valid. 


CB looks at over 90 days only - we look at it holistically - include less than 90 days - and includes people who are not in arrears who are in treatments 

We don't see legal proceedings as a treatment - we see it as a consequence 


*Slide 3 - the change from end of June to today - same as 2 but up to date 

*emphasies accelat

10,000 short term treatments ( down from 11,000) 
9,000  long term (from 5,0000)  ( Includes an increase from  1, 500 to 3,500 split mortgages ) 
 2,000 from 1,000 Assisted Voluntary Sale 
Arrears repayment plane
Can pay their monthly repayment + pay contribute to their arrears


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## Brendan Burgess (5 Sep 2013)

*Ciarán Lynch *

These are the numbers we wanted all along 

A lot of split mortgages by comparison? 

What is your split - answer  between 30% and 45% ( up to 50%) 

Why not give an interest rate reduction instead of a split? 

Masding:  split gives  affordability, sustainability and clarity for the customer 
My experience shows that splits work 

CL: CB allows interest only on buy to lets (rental yield, price movements. we expect the capital back at the end of the term through sale)
 interst only on home loans is not a treatment we are in favour of

Ciaran Lynch is making a great argument for interest only into retirement

Masding says that trade down is legitimate and best use of shareholders' capital - then you get into inheritance issues - our default position is trade-down. 

Shane O'Sullivan - we will sometimes extend beyond 65


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## breakonthru (5 Sep 2013)

*Interest only into retirement*

I wonder what the point was behind Ciaran Lynchs' recommendation re: going interest only into retirement?


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## Brendan Burgess (5 Sep 2013)

Michael  McGrath 

*What is the future for ptsb? *

Masding: The shareholder has put a restruturing plan to the Troika(?) 

There is an issue with the tracker book. But let me kill a myth. Not all trackers are bad. 

€9 billion of  trackers (€14b) are sustainable 

*Can you give us the profile of the book? 
*UK Buy to let CHL - doesn't fit in 
Commercial real estate - doesn't fit in 

Good bank  8.9 b trackers  SVR and fixed - balance
AMU - €3.2  non performing trackers 3.8 SVR and €3 of performing trackers *

What is your current account strategy? 
*Current accounts are the cornerstone of any retail bank 


We should not have put out a lending target at the start of the year. 
We had 2% of the market. We are now 17% of the applications and 13% of approvals - 8% of drawdowns year to date


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## Brendan Burgess (5 Sep 2013)

breakonthru said:


> I wonder what the point was behind Ciaran Lynchs' recommendation re: going interest only into retirement?



Because he reads askaboutmoney 

Why should a mortgage be paid off by retirement to be considered sustainable?


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## Brendan Burgess (5 Sep 2013)

*Kieran O'Donnell *
*Assisted Voluntary  Sales have gone up from 800 to 2,000 since the end of June?  That suggests that you are not considering other arrangements *
We are catching up

*How much have you  written off*
€11m the last time I looked


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## Brendan Burgess (5 Sep 2013)

*Senator   Paul Coughlan *

*Your approach is much better than the Central Bank's approach 
Will you come in with the Governor and discuss these issues together? *



*Pearse Doherty 
"Go raibh maith agaibh" 
I want to acknowledge the momentum you have made, although that momentum appears to be repossessions *

*Case study: once off arrears , cleared within weeks, but got a computer generated letter seeking voluntary sale.

*Masding: This is a waterfall .  then a second group eyeball that. Then there is an appeal. Then the customer can go to the Ombudsman (nonsense) 
*Do you accept that the computer is sending out letters in error? 
*Shane O'Sullivan and Jeremy Masding - We have not been aware of this case 
Masding: If any TDs want to share their cases, we will look at them.

*Are you moving people from trackers to SVR? 
*Although the CCMA allows it, we have no cases of it yet. 

*Were you not obliged to tell customers who did move? 
Yiz failed to inform them 
*


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## Brendan Burgess (5 Sep 2013)

*Deputy Spring 

Where does personal insolvency fit in?  Why are you not telling staff about it? You are telling them you want to repossess their home. 

*We have a Personal Insolvency Manager. We are talking to PIPs. We are running test cases through our systems.


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## Brendan Burgess (5 Sep 2013)

*Richard Boyd Barrett
*You have been much better than other banks and well done. 

But the evidence from my constituents is that your actions don't match your words. 

You are not coming to fair solutions 

One of my clients just can't get a meeting . She is just getting computer generated letters.  She doesn't want letters. She wants to sit down and discuss the various long term solutions 

*Masding 
*We have a direct email account for TDs 
Shane and I look at letters from TDs 
We will look at your case 

*Barrett 
*Please compared the split mortgage with the UB's economic concession 

*Masding
*We are happy with the split mortgage


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## Brendan Burgess (5 Sep 2013)

*Stephen Donnelly
*Bank of Ireland's split mortgage is an "exercise in deep cynicism". 

Case study:  ptsb are insisting that mortgage takes precedence over credit union debt.  The CU debt is used for paying the education fees. Do you want her to leave college. 

Masding: After thinking, I would stand over that letter.

*Donnelly: *That is deeply disappointing.  We don't have an arrears crisis - we have a debt crisis.

(My comment: Fair play to Masding.  Force TDs to face up to reality. If people can't afford to go to College, they can't afford to go to college. lenders should not be forced to give loans to people at mortgage rates to pay for college)


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## Brendan Burgess (5 Sep 2013)

*Simon Harris 

*You are repossessing people who are not in arrears but who have had agreements which they have stuck to. 

*Shane O'Sullivan
*Yes,that happens . After many short term solutions, there has to be a long term solution. 

*Senator Thomas  Byrne 
*You have exceeded  your targets by asking people to leave their homes.  The banks are doing what they are told by the government. 

*Joe Higgins 
*All we are doing is poking at a  likely(?)  forming scab over a deep wound festering underneath  from the orgy of speculating and profiteering 

We need a global solution not putting people through the ringer.

You will be at their gravesides with your hand out. 

*Senator Sean Barrett 
*On buy to lets, they are the homes of tenants. What is your policy about seeking vacant possession. 

(Very disappointing questions from Sean Barrett. As an economist , I would expect more informed and more searching questions.  He might be just so limited in time, he can't do it properly)


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## commonsense (5 Sep 2013)

Brendan Burgess said:


> *Stephen Donnelly
> *Bank of Ireland's split mortgage is an "exercise in deep cynicism".
> 
> Case study:  ptsb are insisting that mortgage takes precedence over credit union debt.  The CU debt is used for paying the education fees. Do you want her to leave college.
> ...



Thought that was just me. There seems to be this push to force only the banks to deal with debt issues, why isn't anyone forcing people to go to their credit unions and credit card companies (for example) and fight for a debt write down there?


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## TRS30 (5 Sep 2013)

Brendan Burgess said:


> *Richard Boyd Barrett
> *You have been much better than other banks and well done.
> 
> But the evidence from my constituents is that your actions don't match your words.
> ...



Direct email account for TDs!!! Letters from TDs. Do TDs get different treatment from other people or is this TDs emailing/writing on behalf of constituents? 

If the latter more parish politics when TDs should be looking at the 'bigger picture'!!


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## Brendan Burgess (5 Sep 2013)

commonsense said:


> Thought that was just me. There seems to be this push to force only the banks to deal with debt issues, why isn't anyone forcing people to go to their credit unions and credit card companies (for example) and fight for a debt write down there?



Hi commonsense

It's a very complicated issue and the Central Bank has issued proposals for dealing with multiple sources of personal debt. 

However, if a person is getting a very generous split mortgage from ptsb i.e. a reduction of around 1/3rd in their interest rate, then the Credit Union must take  big hit as well. 

On the other hand, if the mortgage is in positive equity, and the borrower is engaging with the lender, and it is a SVR mortgage,  there should be scope for the lender to reduce the monthly payments temporarily to allow the borrower clear off the unsecured debt.


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## commonsense (5 Sep 2013)

Brendan Burgess said:


> Hi commonsense
> 
> It's a very complicated issue and the Central Bank has issued proposals for dealing with multiple sources of personal debt.
> 
> ...



Hi Brendan, thanks for that. I suppose my point is, that this particular customer borrowed from the CU to pay for their education, which is laudable enough. But the customer is looking ONLY to the bank for a write - down/solution, not to facilitate payment for the mortgage, but to repay the CU loan.


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