Mr. Stephen Groarke:

That can happen in two sets of circumstances. The first is where a customer comes to us with a previous mortgage, typically for a buy-to-let property, is unable to meet the repayments and goes through the SFS process. We offer what we call a long-term interest-only arrangement as a forbearance treatment. We have buy-to-let customers who are on interest-only arrangements in the Project Glas sale portfolio but they have come through a process where they are demonstrably non-performing because they are not meeting the original terms.

There is another group whose loans would have originally been underwritten on an interest-only basis, typically in the period, 2004-09, as described by Senator O'Donnell. As long as they meet the terms of the interest-only contract, their loans continue to be classified as performing.