Permanent TSB is likely to take legal action against customers who are behind with their mortgage repayments and who have not engaged with the bank over the coming months, its chief executive, Jeremy Masding, hinted yesterday.

Speaking after a fractious annual general meeting in Dublin yesterday, Mr Masding said PTSB hoped to sell its former sub-prime mortgage business, Springboard, by the end of the year.

A large number of the 2,200 homeloans in the portfolio, valued at €450 million, are in arrears and chairman Alan Cook told shareholders at the agm that about 70 per cent of those had been offered "sustainable solutions".

According to a Permanent TSB statement, the bank had by the end of April offered 19,000 settlements to home loan and buy-to-let customers who were in arrears, and 15,700 had accepted. A separate asset management unit within the bank is managing all such loans.

Worked out arrangements Mr Masding said afterwards that the bank was a long way from repossessing the homes of customers in arrears. He explained that the lender will have been in touch with all of them by the end of June, and will have worked out arrangements with many at that stage.

"Sadly, there will be some that will move into a legal process," he said, adding that this would bring the bank a step closer to repossessing those customers' properties. However, he pointed out that it would "step back out of" court action against borrowers who do engage with it. Call for adjournment A number of those at yesterday's meeting in Dublin's Ballsbridge Hotel called for it to be adjourned until after June 20th, when the High Court is due to rule on an action brought by shareholders to overturn the Government's takeover of the bank in 2011. The motion was defeated.

Taking questions from the floor, Mr Cook refused several invitations to comment on the case’s likely outcome. Asked if he would resign should the court rule that the takeover was invalid, he said “I have no plans to resign”.

Letters of comfort Shareholder and former staff member, Mary Nugent, told the board that the bank had sent letters of comfort to retired workers in 2006 assuring them that their pensions would be safe, but they have since had their benefits cut as part of the lender's cost-saving programme.

Mr Cook said he was not aware of the letters. He pointed out that the cuts had hit everyone. “

Every member of staff, including the board, was affected in one way or another,” he said.

The chairman argued that the alternative would have been to liquidate the bank, which would have had even more dire consequences for its pensioners.

In its statement, issued ahead of the meeting, Permanent TSB said that excluding the Springboard portfolio, the asset management unit and UK-based Capital Home Loans operation, its core Irish banking business has made a profit so far this year.

Its mortgage business is 80 per cent ahead of the same period in 2013.

Customers have drawn down €118 million in new home loans from the bank in 2014

Mr Masding noted that there was a particular Dublin bias in mortgage lending last year, but said it has since become more evenly spread.