Permanent TSB has announced a five-fold increase in its lending targets for 2013.

Mortgage market may grow in 2013

In a statement, the bank said it would be significantly increasing targets for areas such as mortgages, personal loans and credit cards.

It says this year it has a projected lending of €450m, compared to €90m for the whole of last year. Further increases are envisaged in subsequent years.

It says the ability to recommence lending follows deposits growth and progress on restructuring.

What remains to be seen is whether or not the levels of projected lending actually materialises in the year ahead. Similar projections by both Bank of Ireland and Allied Irish Bank to significantly increase lending in 2012 fell well short where the overall levels of mortgage lending remained near a 40-year low.

A problem faced by all lenders since the peak of the credit crunch in late 2008 and ensuing bank bailouts by the State has centred on the severe levels of negative equity faced by many existing property owners. Loss of employment and credit problems have also posed problematic for bank underwriters where loan applicants often fail to meet minimum loan qualification standards.