The EBS building society has said it is seeking assistance from the National Asset Management Agency (Nama) to help it deal with over €750 million of property loans.
The chief executive of the EBS building society said today that the bank has about 3 per cent of its portfolio invested in land and development, a situation that he described as being 'unfortunate.'
Speaking on RTÉ radio's
This Weekprogramme earlier today, Fergus Murphy, who took over as chief executive of EBS at the start of 2008, said
"From our point of view we would like to be given an invite to work with Nama to take that piece of our portfolio off our balance sheet," he said.
Mr Murphy stated that in money terms, EBS's troubled portfolio was estimated at about €527 million. However, with associated loans, the total amount of assets which the building society is seeking help with is valued at between €750 million and €800 million.
He added that the property loans were linked to between 60 to 70 borrowers.
"EBS is still reasonably strong but probably in need of some Government capital...and we'd be hopeful that in or around the time the transfer takes place to Nama that we may be eligible to look at that recapitalisation," said Mr Murphy.
"Based on the type of haircuts that are being looked at, in terms of 20 or 30 per cent, I would say at this stage €300 million of capital is required, which is of course a huge amount of money...but is a small amount when compared to the sums being mentioned for other institutions," he added.
Mr Murphy said the building society was "doing everything it can" not to put up mortgage interest rates over the next three months but added that with margins in Irish banks being half of what they are in the UK, Germany and France, it was likely that EBS would raise interest rates at some point.
"EBS genuinely has no immediate plans to increase our margins and are looking to conduct other ways or strategies to increase our profits," he added.
