Tuesday, 1 July 2014
Department of Finance
114. To ask the Minister for Finance further to Parliamentary Question No. 117 of 30 April 2014, if he has received the additional information regarding indemnity bonds which the State supported banks were asked to provide; and if he will make a statement on the matter. [27816/14]
Further to my previous answer on 30 April last, my Department has consulted the State supported banks. In response, the two pillar banks, AIB and Bank of Ireland, have both advised that they currently do not have such a scheme in place in either their PDH or BTL portfolios in the State. Permanent TSB has advised that it has in place limited bond arrangements in relation to certain qualifying mortgage loans for PDH and BTL properties issued prior to July 2007.
PTSB has also informed me that in order to make a claim, the bank must fully comply with the following:
- Follow the arrears procedure agreed at the time of underwriting with the insurer (although certain deviations are permissible if agreed with the insurer);
- If the loan value cannot be recovered, the bank must realise the loss (repossession); and,
- The claim must be submitted within a specified period of the origination date (c.10 years). Claims are subject to a Claim Audit process by the insurer.
PTSB has advised that whilst it has made a small number of claims on this insurance, no proceeds have been received to date. The bank does not anticipate that the receipt of indemnity bonding claim amounts, if any, will materially change the Group's loss outcome.