May 14, 2020 / 6:13 AM / 14 days ago

BRIEF-Ireland's ptsb approves 10,000 loan breaks, flags 50 mln euro charge

May 14 (Reuters) - Permanent TSB Group Holdings PLC :

* BUSINESS AND FINANCIAL PERFORMANCE REMAINED STABLE IN Q1, ALBEIT WITH A DECLINE IN NEW LENDING TOWARDS END OF QUARTER

* PAYMENT BREAKS FOR BOTH MORTGAGE AND TERM LOAN CUSTOMERS; APPROVING C. 10K PAYMENT BREAKS, EQUATING TO C. EUR 1.5BN OR C. 9% OF TOTAL GROSS LOANS.

* NET INTEREST MARGIN OF 1.80% REMAINED IN LINE WITH FULL YEAR 2019

* FULLY LOADED CET1 RATIO OF 15.2%(1), AN INCREASE OF 20 BASIS POINTS ON DECEMBER 2019

* TOTAL NEW LENDING VOLUMES OF EUR 0.35 BILLION INCREASED BY 1% YEAR-ON-YEAR (YOY) COMPARED TO Q1 2019

* MARKET SHARE OF NEW MORTGAGE LENDING OF 14.7%, DOWN FROM 15.1% IN Q1 2019

* NON-PERFORMING LOANS AT 31 MARCH 2020 REMAINED BROADLY IN LINE WITH BALANCES AT DECEMBER 2019

* IN Q1 2020, BANK DID NOT EXPERIENCE LOAN LOSS OUTCOMES RELATED TO COVID-19

* IN LIGHT OF CURRENT ECONOMIC OUTLOOK, BANK EXPECTS NET IMPAIRMENT CHARGE ON ITS LOAN BOOK TO INCREASE IN 2ND QUARTER

* GUIDANCE OF A NET IMPAIRMENT CHARGE OF C. EUR 50M (EQUIVALENT TO C. 60 BASIS POINTS ANNUALISED COST OF RISK) IS DEEMED MORE APPROPRIATE FOR H1 2020

* BANK’S CET1 REGULATORY REQUIREMENT IS 8.94% AND TOTAL CAPITAL REGULATORY REQUIREMENT IS 13.95%

* OPERATING COSTS REMAIN IN LINE WITH MANAGEMENT EXPECTATIONS AS WE CONTINUE TO DELIVER ON COST SAVING INITIATIVES

* SOME OF BANK’S PREVIOUS GUIDANCE FOR 2020 IS NO LONGER APPROPRIATE

* BANK’S ABILITY TO GROW NON INTEREST INCOME. 2020 NEW LENDING COULD REDUCE BY C. 40 - 50% OF 2019 VOLUMES (EUR 1.7BN)

* ACHIEVING COST REDUCTIONS IN CURRENT ECONOMIC ENVIRONMENT WILL PROVE CHALLENGING; HOWEVER, BANK RETAINS ITS OUTLOOK

* HAVING ASSESSED A RANGE OF SCENARIOS, CET1 RATIO WILL REMAIN ABOVE BANK’S MINIMUM REGULATORY REQUIREMENTS Further company coverage: (Reporting By Padraic Halpin)

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