12/6/15: Did Ireland Abandon Homeowners in Need?

An short, but informative article on the issue of mortgages arrears in Ireland:
http://www.herald.ie/news/state-has-abandoned-mortgage-holders-31296163.html

The article correctly points to the lack of state engagement with the issue of long term arrears and the banks' strategy of extend-and-pretend in hope that rising house prices will maximise their returns on future foreclosures.

But the real, the main, point here is whether the Irish state has abandoned the homeowners in need. In my view - the Irish State was never concerned with the interests of homeowners. To think otherwise is to delude oneself once again into a fallacy of seeing the State as an agent concerned with the interests of the people.

Here are the excerpts from the recent study commissioned by the EU Parliament on changes in core rights accruing to individuals across a number of European nations in the wake of the post-crisis austerity programmes. The selection addresses the view of the reporters on Ireland in the context of the right to housing.

"Right to housing was affected in Belgium, Cyprus, Ireland and Spain in two
principal ways: with the increase of foreclosures and evictions and by the
interventions into the allocation of social housing and rental allowances." (page 15)

Note: this is not 'new' as in being indicative of an 'abandonment' of homeowners - rather, this is an assessment of systemic, long-term changes enacted by the State. And it covers both: private structure of homeownership and rental markets, and public provision of social housing.

"At the same time, in Belgium, Cyprus and Ireland, rental allowances or the
availability of social housing are inadequate and insufficient to respond to the needs of people in the wake of the crisis" (page 123)

"The Irish social housing budget was cut by 36% in 2011 and by another 26% in 2012. At the same time, with the loss of jobs and turbulence in the labour market, it is not surprising that the number of households on waiting lists for social housing increased by 75% between 2008 and 2011, i.e. from 56,000 to 98,000. Moreover, it is estimated that in 2011, approximately 5,000 people were homeless in Ireland compared to 3,157 people in 2008. The continued rise in rents, particularly in the last 12 months, is seen as contributing to the problem498, while rent supplements, having been reduced by 20% to 25%, are becoming increasingly inadequate with the severe budget cuts. Certain vulnerable groups have been adversely affected in Ireland. Travellers have
experienced 85% spending cuts on housing since 2008. Moreover, resource allocations for asylum seeker accommodation were reduced by 13% in 20115. In 2008, 36% of all single-parent households were on the waiting list for social housing and one fifth of all people who relied on a rent supplement to meet their rental costs were single parents. The capital assistance scheme, which used to house people with disabilities, was also reduced from EUR 145 million in 2010, to EUR 50 million in 2012" (page 125)

So here you have it - the EU report does not document an act of abandonment as a departure from past policy. It suggests systemic, long term trend toward such abandonment. In other words, the report findings imply a lack of concern or interest on behalf of the State to secure rights to housing from the start of the crisis, not a sudden change of heart.

Full EU report is available here: EUP (2015: PE 510.021) "The impact of the crisis on fundamental rights across Member States of the EU Comparative analysis". Study for the Libe Committee, Policy Department C: Citizens’ Rights and Constitutional Affairs, European Parliament. February 2015: http://www.europarl.europa.eu/RegData/etudes/STUD/2015/510021/IPOL_STU(2015)510021_EN.pdf 

9/4/15: IMHO Proposals Concerning Home Repossessions

IMHO proposals to the Department of Finance on the Risk of Significant Home Repossessions is now available here: https://www.evernote.com/shard/s442/sh/e8e02a47-30c0-49c5-9846-d09f1ab9c18f/20f2d8894a0ab47c9fde09b245120436. 

3/4/2014: Few links for this week...

Couple of recent media comments on a range of topics:

On Irish gas and oil exploration and production: http://monitorglobaloutlook.com/news-story/ireland-renews-push-for-offshore-oil-and-gas/

An interview (in Portuguese) on ECB's dilemmas: http://expresso.sapo.pt/o-mercado-espera-que-o-bce-acelere-a-politica-de-estimulos=f863259

On IMHO's latest initiative announced this week: http://www.irishexaminer.com/business/one-stop-shop-for-mortgage-customers-263976.html and http://news.ie.msn.com/business/they%E2%80%99re-back-bank-executives-to-face-tds-on-mortgage-restructuring

12/3/2014: (If You Missed Them) Here're Mortgages Approvals Numbers

Since we are due data on these soon-ish, only a quick update on IBF data for mortgages approvals and drawdowns. Mostly charts with quick comments.

Here are monthly results through January 2014 for approvals:

We are solidly on-trend on average mortgage approved, below trend on number of new accounts approved. Year on year, however, things are better: 3mo through January 2014 are up on same period in 2013 by some 11.36% for house purchases, 3.47% for re-mortgages and top-ups and up 10.77% for all mortgages (by number of accounts). Average mortgages (on 3mo y/y basis as above) are up 4.72% for house purchases, down 1.3% for re-mortgages and top-ups and up 5.09% for all mortgages.

Overall volume of mortgages approvals by total value are trending also nicely, though the latest numbers came in below trend and are testing some resistance levels:

Drawdowns data is only reported on a quarterly basis, so here is the latest (through Q4 2013):

The above shows us just how abysmal the metric performance has been over the last 3 years. Basically no life in the series to speak of.

4/3/2014: A new Initiative from IMHO

Irish Mortgage Holders Organisation (IMHO) are launching a new programme along with KBC Bank Ireland, aimed at providing independent, consumer-oriented advice and negotiation services to mortgage holders who are currently in arrears or experience difficulties with their mortgages.

Here are the details (click on images to enlarge).

26/2/2014: IBRC Sale Requires Upfront Clarity on CCMA

Much discussion is ongoing concerning the fate of the IBRC Mortgages which are to be sold in the coming weeks/days. The problem centres on the issue of applicability of the Code of Conduct relating to mortgages arrears. By some reports, the book held by IBRC is 50-70% in arrears.

The Government has reached an agreement with the Special Liquidator on the issue. This is covered here: http://www.finance.gov.ie/news-centre/press-releases/agreement-reached-between-special-liquidator-and-phase-two-bidders-ibrc

The idea behind the agreement is a fine one and the Government objective (ensuring that CCMA applies to IBRC mortgagees) is correct one. The problem is that this agreement is voluntary and not enforceable. Thus, it simply muddies the waters.

Here is my view on this expressed earlier on twitter:

In fact the only way to deal with the #IBRC mortgages sale is by setting clear, legally-binding compliance with the code of conduct requirement. This will give certainty on regulatory constraints to bidders/buyers, reduce their concerns about potential ex-post political interference, as well as provide clear-cut enforcement avenue for regulators & supervisors at the CB. A voluntary compliance system, as advocated currently, will only create confusion on the regulatory side but will still be priced as higher risk (bid discount) by bidders. So proposed voluntary arrangement is a lose-lose for everyone, while compulsory regulatory arrangement is a win-win.

Related background:

• Liquidators for IBRC are proceeding with sales of loans books: http://uk.reuters.com/article/2014/02/26/uk-ireland-anglo-idUKBREA1P0SJ20140226
• IBRC holds 12,702 mortgages accounts of which 10,622 are PDH and 2,080 are BTL accounts
• Credible estimate I have seen is that 50% of IBRC mortgages book are in arrears, compared to about 18% for all banks.
• Total Mortgages book to be sold is around EUR1.8 billion

2/2/2014: IMHO-AIB Pilot - First Results

IMHO just published the results of the ongoing IMHO-AIB project for the first 55 days of the scheme operations:
https://www.mortgageholders.ie/blog/posts/progress-update-on-initiative-between-imho-and-aib-ebs-haven

The core numbers are sizeable enough to represent a good sample of borrowers and provide a strong basis for arguing that the independent, professionally provided and borrower-centric advice does work.

I want to stress that all credit for delivering on these results goes to the brilliant frontline team at IMHO!

12/12/2013: Measuring the Mortgages Crisis in Ireland

As the readers of this blog would know, I rarely comment on articles in Irish press, and rarer yet on articles in the Irish Times. So here is a rare occasion, not because of the article itself, but because of what it suggests about our national treatment of statistics.

Let's start from the top. The New York Times published an article on Irish crisis today. Here's the link: http://www.nytimes.com/2013/12/12/business/international/as-bailout-chapter-closes-hardships-linger-for-irish.html?pagewanted=2&_r=1&rref=business&hpw&pagewanted=all

Irish Times - in some ways correctly took the New York Times article to task: http://www.irishtimes.com/news/ireland/irish-news/are-we-really-reduced-to-shooting-pigeons-for-food-1.1625588

Let me take up one point in the two articles. Original version of the NYT article cited - quoting from the IT response - that "most startling is the assertion that two-thirds of homeowners have not paid their mortgage “on time for the last two years”".

IT correctly points that this is not true, saying that "The bank’s most recent arrears figures suggest 18.5 per cent of mortgage holders are in arrears of some sort or other.
They also indicate that 22 per cent of those currently in arrears are behind in their payments for at least two years or more."

The NYT published correction to their original claim. Story ends there.

But from the point of view of reality, it does not. This is pivotal to our narrative about the crisis.

Mortgages arrears have many meanings in the economy. But in the social context and in relation to mapping out the extent of the crisis here's what matters: Mortgages arrears are a signifier of the extent of the crisis. In this, they are neither the only indictor, nor are they a relative indicator. Let me explain.

1. Assume we want to identify the extent of the crisis as it impacted the households holdings of property.
2. Assume we have official data to do so only.

From (1) and (2), identifying the crisis extent is simple and yet hard. 

Take an analogy of identifying the crisis in the macroeconomy. That would be GDP. Or rather, the size of the crisis = the gap between the GDP at pre-crisis peak to GDP at crisis-period trough. One thing that does not matter to this analysis is where the GDP is today (post-trough). Should in the future the GDP hit a new trough and should the drivers for this be consistent with the drivers for the original crisis, then that new trough becomes the crisis metric. Should GDP recover to pre-crisis highs (as it will one day), the magnitude of the crisis will not be zero, it will still be GDP pre-crisis less GDP at trough.

Variants on the above are possible by looking at various GDP metrics and/or pre-crisis and trough metrics (trend, potential etc). But the essence of analysis is the same: GDP pre-crisis - GDP at trough = Crisis Impact.

Now, back to the original issue: How shall be measure the impact of the crisis when it comes to mortgages?

The IT comments can suggest (and usually the media obliges to take this as given) that Arrears Current = Crisis Impact. But are they?

My view is that they are not. Let's compute the total impact:

1. Peak of arrears (we are yet to reach that) = part of impact
2. Restructured mortgages that are not in arrears = part of impact for two reasons: (a) they face high probability of going back into arrears (just under 50:50 chance currently and declining slowly); and (b) restructured mortgages are no longer the original pre-crisis mortgages, so the mere fact of restructuring them is a sign of the crisis impact
3. Repossessed homes = direct impact; and
4. Voluntary surrenders = direct impact.

What do we know from official sources: Total mortgages outstanding: 915,746 per CBofI (composed of 768,136 principal residences-linked mortgages and 147,610 BTLs), of these:

1. Total mortgages in arrears: 181,946 per CBofI (composed of 141,520 principle residences and 40,426 BTLs)
2. Restructured, not in arrears: 56,186 (composed of 43,034 principal residences and 13,152 BTLs)
3. Repossessed homes - we have no numbers for aggregates repossessed - neither the CBofI, nor Department of Finance report these on any regular basis. But in Q3 2013 we had 1,566 properties in repossession (1,050 residences and 516 BTLs). These are properties held in possession by the banks. We do not know how many they have sold since the beginning of the crisis.
4. Voluntary surrenders - we have no data on these from any official source, but the properties that are surrendered and are still in the possession of the banks are aggregated into (3) above.

So, with incomplete information on (3) and (4), to-date, the extent of the crisis is for all types of properties:

181,946 in arrears + 56,186 restructured, not in arrears + 1,566 repossessed and surrendered = 239,698 accounts or, ca 26% of all accounts outstanding.

And the number is growing...

This is not 2/3rds as claimed originally in the NYT, not even 1/3rd, and it is certainly not the percentage of mortgages in trouble over 2 years... and the above 26% include BTLs too... But the true extent of the crisis is that 26 out of 100 mortgages in the country have been directly impacted by it. And the crisis has not peaked, yet.

But here's what this tells us about our psychology when it comes to measuring the extent of the crisis: we commonly interpret arrears alone (and often only arrears in excess of 90 days) as the metric of the crisis. This is an error - an error based on the implicit anchoring of the idea of the crisis to the news and thus, to relative position in time. This is simply wrong. The crisis of WW2 is measured by the absolute level of destruction wrecked at the peak, cumulatively, not by where the losses were in 1955 or in 1948.


Actually, should you be interested, I track the evolution of the above metric (I call it mortgages in default, defaulted or at risk of default) in my regular posts on CBofI quarterly data. The latest was provided here: http://trueeconomics.blogspot.ie/2013/11/28112013-irish-mortgages-arrears-q3-2013.html.

And for the conclusion: I recall in 2007 CEO of AIB at the time stating in a meeting with analysts that "Irish people do not default on mortgages. They never do." I replied: "Never is a very precise term. Is there any uncertainty around this claim?" and he retorted: "None." Back to that 26% figure, then?..

4/12/2013: IMHO launches a new service for distressed borrowers

Irish Mortgage Holders Organisation (IMHO: https://www.mortgageholders.ie/) have launched a new initiative today designed to provide free bankruptcy service for distressed borrowers.

Here are the details:

Contact details: via email info@mortgageholders.ie or Arthur Mullan, IMHO: 01-871 9411

29/11/2013: Central Bank: Failure of Own Sustainability Criteria on Mortgages Arrears Resolutions?

So things are getting better with mortgages arrears crisis… practically easing the worries of the nation, according to the Irish media and officialdom… And the Central Bank is delighted that the banks are so actively meeting targets etc… (Note: my coverage of the arrears figures is here: http://trueeconomics.blogspot.ie/2013/11/28112013-irish-mortgages-arrears-q3-2013.html)

Except…

Per Central Bank: “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.”

And what these 'sustainable solutions' might be, you should ask?

Per CB: "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%."

Now, let me be forthright here on my views:
1) Repossessions and voluntary surrenders are a part of the solutions tool kit and are unavoidable (and indeed optimal) in a number of cases.
2) However, the above can only be deemed sustainable if and only if they take place in the context of first (ex-ante repossession or surrender) concluding arrangements between borrower and lender on what is to be done with the residual balance on mortgage remaining at the end of the property sale.

Since we do not know what percentage of all repossessions and surrenders were accompanied by such an agreement, we do not know if there is ANY (repeat - any) sustainability of debt has been achieved in the process of such a resolution. In other words, the Central Bank cannot make a factual claim that 55% of the resolution measures proposed were sustainable (aka meet the CB own criteria for them satisfying the target requirement).

Worse, the massive number - 55% - is itself an indication that the entire Central Bank-led process is a complete failure. In fairness to the Central Bank, the language of the release (http://www.centralbank.ie/press-area/press-releases/Pages/CentralBankpublishesoutcomeofMortgageArrears.aspx) suggests that the bank is not entirely happy with the status quo distribution:

"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."

But there are problems even with this claim. Firstly, there is no trend. There is not enough time series data to show ANY (repeat - any) trend up or down in the data. What we have is one quarter against another. Should the 'trend' of 7 percentage points per quarter continue, we will end 2014 with over 40% 'resolutions' leading to foreclosures or surrenders of properties. Given the bank wants to deliver 75% resolutions target by the end of 2014, this would imply that more than 40% of the mortgages accounts in arrears will be in liquidation. That is a trend to a national disaster.

28/11/2013: Irish Mortgages Arrears: Q3 2013

Numbers are out for Residential Mortgages Arrears in Q3 2013 and the data shows that the chronic problem of mortgages distress is still with us with little change after months of tough talks from the authorities, 'resolute' actions from the banks and a barrage of legislative, regulatory and rhetorical changes.

Top of the line numbers are still frightening, albeit things have largely faltered out on most fronts.

• Total number of PDH accounts at risk or defaulted (defined as all accounts currently in arrears, restructured and not in arrears, and in repossessions) at the end of Q3 2013 stood at 185,604, down 329 accounts or 0.2% from Q3 2012. 
• Over the 12 months through September 2013, number of BTL accounts at risk or in default rose 3,022 (+5.9%) to 54,094. 
• Thus, total number of mortgages accounts currently at risk or defaulted at the end of Q3 2013 stood at 239,698, which is 1.1% higher than in Q3 2012. 
• Total outstanding volume of mortgages at risk or defaulted for both BTL and PDH mortgages at the end of Q3 2013 was EUR46.77 billion, up EUR1.75 billion on year ago.
• As of the end of Q3 2013, 20.3% of all PDH mortgages accounts and 36.65% of all BTL mortgages accounts were either in arrears, restructured due to previous arrears or in repossession. 
• Across the entire system, 26.18% of all mortgages accounts and 33.6% of all mortgages volumes outstanding in Ireland were at risk or defaulted at the end of September 2013.

Deleveraging process is not working either:

• Total outstanding volume of mortgages debt in the country was EUR138.88 billion in Q3 2013, only 2.4% lower than a year ago.
• Total number of mortgages accounts fell to 915,746 in Q3 2013, down 3.08% y/y.
• Residential mortgages in arrears rose to 141,520 accounts (+0.1% y/y) and BTLs accounts in arrears numbered 40,426 (+10.35% y/y). Thus total number of accounts in arrears was up 2.2% y/y.
• Total outstanding volumes of mortgages in arrears stood at EUR36.56 billion in Q3 2013, up 5.8% y/y (comprising EUR25.56bn in residential mortgages volumes +4.75% y/y and EUR11.0bn of BTLs +8.32% y/y).
• Total amounts of actual arrears rose to EUR3.479bn in Q3 2013, up 28.2% y/y.
• Repossessions rose to 1,566 in Q3 2013 from 1,503 in Q2 2013 and 1,358 in Q3 2012. Residential repossessions rose to 1,050 from 1,001 a quarter ago and 944 a year ago. The process of repossessions remains very slow and is likely to accelerate in the near future.

These figures clearly show that banks-driven approach to the process of resolving the mortgages arrears crisis, adopted by the Government and the financial sector regulatory authorities is not delivering. To-date, the speed of mortgages arrears restructuring and resolution is disappointingly slow.

Some charts to illustrate the trends:

17/11/2013: Mortgage holders in difficulty to avail of new initiative from tomorrow: IMHO

Tomorrow, the new IMHO pilot programme for AIB/EBS/Haven clients in mortgages arrears and distress comes on line. Key points of contact: www.mortgageholders.ie or via 1 809 623 624.

The full press release on the initiative is available here:  https://www.mortgageholders.ie/blog/posts/mortgage-holders-in-difficulty-to-avail-of-new-initiative-from-tomorrow

All details on the initiative purpose and set up are available here:  http://trueeconomics.blogspot.ie/2013/11/5112013-my-op-ed-for-journalie-on.html


Note: to preclude any confusion or accusations against IMHO or myself: I do not provide frontline client-facing advise or services. I am a member of the board. Sadly, given past experiences with some commentators, I have to state this. 

5/11/2013: My op-ed for Journal.ie on IMHO/AIB initiative

Yesterday, Irish Mortgage Holders Organisation (IMHO) announced the new pilot scheme to help Irish mortgagees in dealing with their lender, the AIB Group (see details here: http://trueeconomics.blogspot.ie/2013/11/4112013-imhos-latest-initiative-to-help.html).

My op-ed on Journal.ie explains this new initiative and the background to the project: http://www.thejournal.ie/readme/imho-aib-group-mortgage-arrears-1160947-Nov2013/

4/11/2013: IMHO's latest initiative to help distressed borrowers

Today was a big day for Irish Mortgage Holders Organisation. Here's our announcement:
https://www.mortgageholders.ie/blog/posts/imho-launches-an-initiative-for-aib-ebs-haven-borrowers

It is a big step for many distressed borrowers and we hope that other banks will follow the AIB Group steps and start treat seriously the need to help homeowners secure independent and client-focused professional advice regardless of people's ability to pay.

The scope of the crisis we face is unprecedented. Here's a reminder:
http://trueeconomics.blogspot.ie/2013/09/592013-sunday-times-september-1.html
and the latest data on arrears:
http://trueeconomics.blogspot.ie/2013/08/2382013-irish-mortgages-arrears-q2-2013.html

21/10/2013: IMHO Submission on Minimum Competency Requirements 2013

Irish Mortgage Holders Organisation submission to the Central Bank on consultation paper on Authorisation Requirements and Standards for Debt Management Firms and the Amendment of the Minimum Competency Code is now available on the Central Bank page here: http://www.centralbank.ie/regulation/poldocs/consultation-papers/Documents/CP70/IMHO%20submission.pdf

17/9/2013: CBI Sets New Targets for Mortgages Arrears Resolution

The Central Bank of Ireland has published new target for the mortgages resolution process: http://www.centralbank.ie/press-area/press-releases/Pages/CentralBankstatementonMortgageArrearsResolutionTargetsConcludedArrangements.aspx

The new target is that by the end of December 2013, 15% of mortgage holders in arrears above 90 days (as of the end of June 2013, ) should have "concluded agreements " completed. In March 2013, the Central Bank had requested offers of solutions to be made in respect of 20% of arrears cases, rising to 30% to Q3 and 50% by the end of December 2013. On foot of these targets, the Central Bank is now requiring that 15% of all arrears cases above 90 days should be concluded by the end of year.

March 2013 target of 20% offers of solutions by the end of Q2 2013 required the banks to submit formal offers on 19,575 principal residences mortgages accounts and 6,065 BTL accounts, while the new target of 15% concluded arrangement covers 14,681 principal residences mortgages accounts and 4,549 BTL accounts. In other words, the Central Bank’s combined targets are for the banks to issue formal offers of solutions to 25,640 accounts and achieve concluded arrangements on 19,230 accounts.

Detailed Central bank paper setting out original set of targets is available here: http://www.centralbank.ie/press-area/press-releases/Documents/Approach%20to%20Mortage%20Arrears%20Resolution%20-.pdf

IMHO will be issuing a more extensive press release on today's announcement later, stay tuned for the link.

14/9/2013: IMHO signs agreement with Alsop Space Ltd

Irish Mortgage Holders Association have signed an agreement with Alsop Space Ltd that ensures that Alsop Space Ltd will not undertake auctions of repossesses Irish primary residences.

Keep an eye out for more details: https://www.mortgageholders.ie/

23/8/2013: IMHO statement on Mortgages Arrears for Q2 2013

Irish Mortgage Holders Organisation (IMHO) issued opinion on today's mortgages arrears figures: https://www.mortgageholders.ie/another-false-start-in-resolving-mortgage-crisis/

My detailed analysis of the figures is here: http://trueeconomics.blogspot.ie/2013/08/2382013-irish-mortgages-arrears-q2-2013.html

23/8/2013: Irish Mortgages Arrears: Q2 2013

Mortgages rears figures are out for Q2 2013 and guess what, things are (predictably) getting worse. I am sure the Government will say that 'getting worse today'='getting better in the future'. As such, we do live in the world where stabilisation = decline in the rate of decline, while a slight uplift on any time series is greeted as an indisputable 'gathering growth momentum'.

What do the numbers of mortgages arrears tell us, spin aside? I highlight main conclusions in bold.

In Q2 2013 there were 919,139 mortgages accounts outstanding (EUR139,883 million in total), of which 770,610 accounts were for primary residences (EUR109,147 million). Primary residences are referenced as PDH accounts in CBofI. The balance of 148,529 accounts  (EUR30,626 million) relate to Buy-to-lets, BTLs.

This means that over the year through the end of H1 2013, the number of mortgages accounts rose 0.4% and their outstanding volumes fell 2.41%. Deleveraging is very slow in the economy, given the crisis scope: number of primary mortgages accounts rose 0.7% and their volume shrunk 2.52%, while the number of BTLs fell 1.1% and their volume shrunk 2.01%. In fact, as the chart shows, deleveraging process so far is not helping the workout of arrears:

Total number of primary accounts in arrears of any duration is up 11.46% y/y, underlying volume of mortgages represented by these is up 9.1% to EUR25.69 billion from EUR23.55 billion a year ago, while amounts in arrears are up 36.46%, breaching EUR2 billion for the first time. This means that, penalties inclusive, the arrears are now attracting ca EUR202 million in roll up charges annually or about 40% of the annual savings that we need to deliver in Budget 2014 from the social welfare funds.

Total number of BTLs in arrears was up 15.06% y/y and the amounts of mortgages outstanding for the BTLs in arrears rose to EUR10.94 billion - up 11.45% y/y, while the actual cumulated levels of arrears hit EUR1.207 billion, up 43.63% y/y.

All in, there were 182,840 accounts in arrears, representing cumulative amount outstanding of EUR36,634 million and cumulated arrears of EUR3,231 million. These were up: +11.39% y/y for account numbers (+19,924 accounts), +EUR3.267 billion or 9.79% y/y for mortgages outstanding, and +EUR 907 million or +39.05% y/y for actual arrears.

Repossessions accelerated, but remained subdued overall, rising to 1,503 accounts (1,001 accounts for primary residences). This represents a y/y increase of 13.69% for all accounts, 6.04% rise for primary residences and 32.8% jump for BTLs.

Restructured mortgages numbers declined in Q2 2013, from 106,612 accounts to 100,920 accounts over the period of 12 months through June 2013. This breaks down as per decline of 6.57% for primary residences from 84,941 to 79,357 accounts, and a decline of just 0.5% for BTLs from 21,671 to 21,563 accounts.

Performance of restructured mortgages somewhat improved, although we do not know as to why this was the case. Restructured mortgages that were not in arrears as percentage of the total number of restructured mortgages has improved from 47.35% to 53.31% for primary mortgages, and from 51.17% to 61.13% for BTLs.






And some scarier figures for the end:

• Total number of mortgages at risk of default or defaulted (mortgages in arrears, mortgages restructured and not in arrears, and repossessions) rose to 239,834 in H1 2013 (up 11.27% y/y)

• Total number of primary mortgages at risk or defaulted rose to to 186,202 in H1 2013 (up 9.94% y/y)
• Total number of BTL mortgages at risk or defaulted rose to to 53,632 in H1 2013 (up 16.12% y/y)

• 20.26% of all primary residential mortgages were in arrears or at risk of default in Q1 2013, against 18.50% in Q2 2012.
• 36.11%of all BTL mortgages were in arrears or at risk of default in Q1 2013, against 30.75% in Q2 2012.
• 26.09% of all residential mortgages were in arrears or at risk of default in Q1 2013, against 23.55% in Q2 2012.
• By volume of mortgages outstanding, 33.35% of the total mortgages pool or EUR46,618 million were mortgages either in arrears, or restructured at the end of Q2 2013, up on 29.51% (or EUR42,258 million) at the end of Q2 2012.