Permanent TSB has raised an additional €400 million in funding via a private deal with an international bank.

This means the bank, of which the State owns about 99 per cent, has raised more than €3.6 billion in debt since the beginning of this year.

It is understood the bank has also generated €1 billion in deposit inflows over the past six months, largely from corporate and institutional sources.

This leaves Permanent TSB well placed to repay a maturing €1.3 billion bond in April, after which it will not have a redemption until 2015.

Security for funding

The Irish Times has learned the €400 million capital-raising deal was agreed earlier this week. Part of the bank’s Irish residential mortgage book was used as security for the funding, which has a two-year term.

Earlier in the year, Permanent TSB refinanced €2.6 billion of existing facilities and €600 million in fresh finance backed by its UK mortgage book.

Securing funding backed by its Irish mortgage book will be seen as significant in the context of the bank’s restructuring.

It is not clear precisely what coupon is attaching to the new funding.

Debt unguaranteed

The debt is unguaranteed and so is not part of the eligible liabilities guarantee (ELG) scheme that the Government said on Monday would end on March 28th.

Commenting on the fundraising, a spokesman for Permanent TSB said: “We’ve had good success in recent weeks in raising money on the back of our UK and Irish mortgage books.

“These transactions confirm our ability to finance our operations on an ongoing basis without reliance on the bank guarantee, and demonstrates why the time is now right to bring the ELG scheme to a close.”

Formerly part of Irish Life Permanent, the bank has received €4 billion in funding from the State.