PTSB said its share of new mortgage lending rose to more than 20 per cent in the first quarter of the year, as the bank recorded “a good start to 2025” even as the global economy dealt with mounting uncertainty.
The slice of mortgage lending marked a significant improvement from 13.4 per cent the same period last year, and 16.4 per cent rate for 2024 as a whole.
“Our core mortgage business entered the year with a strong pipeline and we recorded a share of new mortgage drawdowns in the first quarter of over 20%, continuing the momentum we showed through 2024,” said chief executive Eamonn Crowley, as PTSB issued a trading update on Wednesday.
He added that new lending in its relatively small business banking unit was up 25 per cent on the year, with small- to medium-sized enterprise activity “having a particularly good start to the year”.
“Our funding and capital positions remain strong and notwithstanding heightened uncertainty associated with the global picture on international trade and how this might impact Ireland, we remain confident about the prospects for our business in 2025,” he said.
PTSB has priced its loans more competitively in the past year, following a period in which it refused to fight for new business as aggressively as AIB and Bank of Ireland on pricing as the European Central Bank (ECB) was ratcheting up interest rates.
PTSB currently has to set aside more expensive capital against home loans than its rivals, because of the perceived riskiness of its mortgages in its risk models. However, it is currently working on a project to lower the risk-weighting attached to its mortgages, which it hopes to file with the Central Bank by the end of June in the hope that it will free up some capital.
PTSB also has a lower level of cheap excess deposits than AIB and Bank of Ireland.
Net interest income fell by 9 per cent at PTSB in the first quarter as a knock-on effect of the ECB’s current cycle of lowering rates again. Its net interest margin (NIM) – the difference between the average rates at which it funds itself and lends on to customers – declined to 2.03 per cent from 2.31 per cent for the equivalent period last year.
“Recent deposit rate reductions by the bank which became effective from April 2nd will help negate the effect of further downward movements in base rates,” PTSB said. “As such we still expect NIM to exceed 2 per cent for the year.”
Total operating expenses were down 4 per cent during the quarter, with underlying costs that exclude regulatory charges down 1 per cent. The bank said it remains on track to meet its cost target of €525 million for the year, down from €525 million for 2024, and helped as the bank cuts 300 jobs as general pay rates rise.
Total gross loans on the balance sheet rose to €22 billion at end March 2025 from €21.8 billion in December. Customer deposits increased by €800 million over the same three months to €24.9 billion.
