STATE-OWNED PERMANENT TSB has reported losses of €922 million for 2012.

The losses are mostly as a result of impairment charges as a result of loans that the bank does not expect to have repaid.

€891 million in loans were written off last year, accounting for the lion’s share of the bank’s pre-tax losses of €922 million.

The bank expressed satisfaction with the results, however, noting that its impairment losses were down by over half a billion euro compared to 2011.

In 2011, impairment charges allowed for almost all of the bank’s losses.

The bank’s core capital ratios have also improved, and are now well ahead of the minimum ‘Basel III’ standards enforced across the industry.

The figures also saw the bank reveal that almost one in six mortgages are in arrears of over three months or more – up from 12 per cent in 2011 – but that the number in arrears under 90 days had fallen from 6.9 per cent to 5.5 per cent.

Its net interest rate on income fell from 0.92 to 0.72 per cent, a drop largely attributable to the cut in variable mortgage interest rates.

Chief executive Jeremy Masding said the group had pursued a ‘bank plus two’ strategy to see two units spun off from the main bank in an effort to maximise their value for the taxpayer.

“Each of these units has a discrete strategy, management team and financial plan. We have raised the bar and will continue to do so,” he said.

The bank’s British mortgage loan business, CHL, is being spun off, as is an asset management unit.

The group said it had tackled its high cost base by closing 160 branches and dropping 200 staff last year, while seeing its deposit base grow by €2.2 billion.

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