Ulster Bank chief executive Jim Brown told the Oireachtas finance committee yesterday that it was not in the business of writing off mortgage debt for customers in arrears with their home loans.

“Writing down an arbitrary amount of debt for a small number of people while they remain in their home is not something we will do,” he said. “We do not believe that it is an appropriate solution. The write-down or write-off of debts is, we believe, an unhelpful distraction that is likely to create issues around moral hazard, transparency and fair outcomes for customers.”

On questioning from committee chairman Ciarán Lynch, Mr Brown did concede that Ulster Bank does write off debt in the case of repossessions.

Mr Brown said the focus should be on “affordability” and not negative equity and reiterated that Ulster Bank does not want to repossess homes.

Mortgage details
Ulster Bank told the committee that 14,231 owner-occupied mortgage accounts were in arrears of 90 days or more at the end of December and 2,657 buy-to-lets.

The bank said 4,323 owner-occupier mortgage customers were in some form of legal proceedings along with 1,487 buy-to-let customers.

Mr Brown said this was a result of customers being unwilling to engage with the bank or to make repayments on their loans for up to two years. He said the number of customers in arrears had fallen each month since March 2013, with 2,500 moving out of arrears in the past seven months.

“Since last summer, the number of customers in arrears who have not engaged with us and who are not making any contribution to their mortgage has reduced significantly from 35 per cent to 14 per cent,” he added.

He acknowledged that this number was still “unacceptably high” and that the bank had no choice but to pursue these cases.