Central Bank publishes outcome of Mortgage Arrears Resolution Targets 

Press Release 29 November 2013

The Central Bank of Ireland today (29 November 2013) publishes the outcome of the Mortgage Arrears Resolution Targets for Quarter 2 and Quarter 3 of 2013. In line with requirements all banks[1] have reported sufficient proposed solutions to meet the target of 20% proposed sustainable solutions in Quarter 2 and 30% in Quarter 3 (end September). 

The Central Bank conducted an audit of the banks’ Quarter 2 results which examined the banks’ processes of determining and proposing sustainable solutions against the Central Bank’s sustainability guidelines.  A number of issues were identified which will need to be addressed by the banks to ensure that the solutions being proposed are sustainable in the long term.  However it was found that the issues arising would not have resulted in any of the banks’ failing to reach the Quarter 2 target of 20% proposed sustainable solutions, given the surplus levels submitted by the banks.

Key issues identified include:

  • Short-term loan modifications were proposed in some cases where there was:

          o   no tangible evidence of a borrower’s circumstances improving

          o   no clarity on the ultimate long-term solution;

  • An absence of requisite information, such as verification of borrower income or property value; and
  • A lack of evidence of legal follow up in cases counted under legal heading.

Director of Credit Institutions and Insurance, Fiona Muldoon, said “We are now starting to see some signs of progress in addressing the significant issue of mortgage arrears. The audit process, while highlighting some key issues which require attention, shows evidence of long-term loan modifications being offered to borrowers who are no longer able to afford the original repayment requirements. The latest data on mortgage arrears is also encouraging, with indications that the level of new arrears cases is declining and an emerging pattern of stabilisation in the numbers generally.

“We expect that lenders will continue to progress and develop their approaches to ensure that future sustainability targets will be achieved.  With indications the banks are now offering long term sustainable solutions to customers, the Central Bank continues to encourage meaningful engagement between lenders and borrowers.”

Quarterly Outcomes

In March 2013 the Central Bank published the Mortgage Arrears Resolution Targets framework, which set out the performance targets for mortgage arrears resolution at six Irish mortgage lenders. The six lenders, Allied Irish Banks, Bank of Ireland, permanent tsb, Ulster Bank, ACC Bank and KBC Bank are required to meet targets at quarterly intervals. As at end of September 2013 the lenders in total reported they had issued proposals to 43% of mortgage accounts in arrears against a target of 30%.

Table 1









Mortgage Modification





PIP Appointed





Voluntary Surrender / Repossession




There has been a change in the trend of proposed solutions from Quarter 2 to Quarter 3. In Quarter 2 62% of the proposals were in the Surrender/Repossession category, which decreased to 55% in Quarter 3.   

Further information: Press Office (01) 224 6299, press@centralbank.ie


Notes to Editors

The Central Bank has published Internal Guidelines on Sustainable Mortgage Solutions which outlines the factors which should be considered by lenders when determining if proposals are sustainable solutions for mortgage arrears cases.

On 13 March 2013 the Central Bank published the Mortgage Arrears Resolution Targets framework. .

The Central Bank’s Code of Conduct on Mortgage Arrears 2013 sets out how mortgage lenders must treat borrowers in or facing mortgage arrears.  The Central Bank’s Consumer Guide is available here.

[1] Allied Irish Banks, Bank of Ireland, permanent tsb, Ulster Bank, ACC Bank and KBC Bank