Irish Banks Said to Face European Pressure to Write Off Loans

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Irish banks are set to face mounting pressure from regulators to write off bad loans, a person familiar with the matter said. European authorities that now oversee the biggest Irish lenders have consistently pushed bankers to deal with the legacy of non-performing assets left over from the nation’s financial crash through measures such as loan sales, Bloomberg News reported. Regulators are beginning to lose patience with some lenders, meaning more urgent solutions may be sought unless convincing plans are laid out, according to the person, who asked not to be named as the deliberations are private. The plunge in Permanent TSB Group Holdings Plc’s share price over the past three weeks underscores the need for action, the person said. Some Irish officials have pushed back against wide-scale write offs, arguing the European regulators failed to recognize progress made on reducing bad loans and the potential for the assets to rebound in value, a second person said. Write-offs would also crystallize losses, hurting banks’ capital ratios. Bad loans remain a 900 billion-euro ($1 trillion) burden on Europe’s banking sector and a millstone crimping economic growth. Read more.