Monday, June 16, 2008

As Irish bank shares tanked late last week, some of the top financial institutions are beefing up the numbers who work in debt management, fearing defaults in repayments.

Bank of Ireland admitted on Friday that it has increased staff in debt management to keep a "close watch" on problem loans. The Sunday Independent understands that Ulster Bank is also considering upping employees in its debt management division, though a spokeswoman for the bank denied this.

Anglo Irish, downgraded to 'sell' by Citigroup last Friday amid credit quality concerns, refused to say if it had employed more debt management staff.

Bank of Ireland was also downgraded to 'sell' by Citigroup, warning that the bank was "highly exposed" as 71 per cent of its loans are secured against property.

With the threat of a hike in European Central Bank rates next month, banks could soon be nursing more bad debts.

AIB and Permanent TSB said they had no plans to increase staff in debt management. Last week, Merrion Stockbrokers issued a report on Irish Life & Permanent, suggesting that it may be forced to address a serious imbalance in its funding practices.

Source: www.independent.ie/business/irish/
debt-management-now-major-focus-for-banks-1401902.html