Permanent TSB to increase lending five-fold

DUBLIN Mon Jan 7, 2013 8:56am GMT

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DUBLIN (Reuters) - State-owned Irish lender Permanent TSB plans to boost lending to consumers to around 450 million euros (365 million pounds) in 2013, a five-fold increase on last year's figure.

The ability to lend more for mortgages, personal loans and credit cards follows growth in deposits and progress on restructuring, including the closure of many branches, Permanent TSB said in a statement on Monday.

The bank (IPM.I) said it intends to lend 350 million euros in mortgages, 100 million euros in personal lending, including car loans, and 5 million euros in new credit card finance.

Further increases are scheduled for future years, said the bank, which lent out 90 million euros in 2012.

"We will continue to increase our provisions linked to historic lending but they are in line with the scenario laid out in our restructuring plan and we're making great progress on implementing that plan," chief executive Jeremy Masding said.

Permanent TSB doubled the size of its deposit book to approximately 12 billion euros over the past few years and made significant progress in its restructuring plans during 2012, according to Masding.

"Our restructuring plan is based on a twin-track approach whereby we return to lending into the Irish economy at the same time as we continue to work through the legacy issues of impaired loans and arrears," Masding said.

The bank said it wanted to return to profitability in 2016 and re-establish itself as the third pillar bank in Ireland (along with Bank of Ireland (BKIR.I) and Allied Irish Bank (ALBK.I)) by focusing on lending.

"We are well on our way to achieving those targets," Masding said.

Shares in Permanent TSB rose 6.6 percent in early trading following its statement.

(Reporting by Stephen Mangan; Editing by Hans-Juergen Peters)