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ISI Seirbhis Dóchmainneachta na hÉireann Insolvency Service of Ireland Annual Report 2021 isi.gov.ie Contents 1 Foreword by the Director 2 The ISI – What We Do 3 The ISI – Who We Are 4 Infographics – 2021 Statistics at a Glance 5 Operations 6 Legislation 7 Communications 8 Abhaile 9 Stakeholders 10 Corporate Updates 11 Appendix 1 Case Studies 12 Appendix 2 Further Details and Key Statistics – DRN, DSA, PIA 13 Appendix 3 Further Details and Key Statistics – Bankruptcy 14 Appendix 4 Further Details and Key Statistics – Policy and Regulation 15 Appendix 5 Glossary of Terms 27 28 29 1 Annual Report 2021 1 Foreword by the Director As Director of the ISI I am pleased to present our annual report for 2021.
The Covid-19 pandemic continued to have a dominating influence on the Irish economy during 2021, including in the personal insolvency sector where case volumes generally remained lower than pre-pandemic levels.

This was likely attributable to a number of factors including the continuance of government income and business supports, reduced pressure from mortgage creditors and a decrease in possession hearings in the courts.
However, as these supports unwind and normal court activity resumes, the longer-term outlook is difficult to predict, especially when combined with the impact of increases in the cost of living and the likelihood of further negative economic consequences arising from the invasion of Ukraine.
In addition to those borrowers who were already in severe financial difficulty before the pandemic, including those in unresolved long-term mortgage arrears, we may now see a new group of borrowers facing difficulty and in need of assistance.

The ISI and its network of authorised personal insolvency practitioners (PIPs) and approved intermediaries (AIs) are available to help those borrowers and their creditors achieve resolutions for the most difficult debt situations that may arise.
The legislative framework that underpins our insolvency framework was improved through the Personal Insolvency (Amendment) Act 2021.

However, in the context of the economic headwinds now facing the economy, it is critical that the recommendations contained in our section 141 submissions to the Department of Justice and those on bankruptcy law reform are given effect as soon as possible.
We believe these further reforms will help drive further efficiencies, improve the overall process and make the framework more accessible to those who need it.

Over the course of 2021 there was increasing evidence of innovation in the type of insolvency solutions that were being agreed between PIPs and creditors.
Together with a continuing decline in section 115A review applications, this reflects improving engagement between both sets of stakeholders and highlights the potential if this engagement deepens and increases in consistency between all PIPs and creditors.
The mortgage arrears landscape itself continued to evolve during the year with the most recent Central Bank statistics indicating that 43 per cent of all mortgages in arrears and 57 per cent of those in arrears of more than two years are now held by non-bank entities as opposed to traditional banks.
With the imminent departure of a number of retail banks from the Irish market and the potential sale of further non-performing mortgage loan books by the remaining banks, it is likely that the proportion of non-performing mortgages held by these non- bank entities will continue to increase significantly.

Most of these institutions are engaging well with the insolvency framework and I hope and expect for 2022 and beyond that this engagement will continue to improve across the board.
In 2021 the ISI conducted a public consultation around our guidelines on reasonable living expenses (RLEs).

I am grateful to our stakeholders for their submissions.

These help us ensure a vital balance is maintained between allowing a debtor an appropriate standard of living while addressing their financial difficulties and enabling a fair return to creditors based on the debtor’s means.

The revised RLE guidelines will issue in the first half of 2022.
We are continuing to invest significantly in our ICT systems and in our capacity to increase the understanding and awareness of our solutions with the general public.

To that end, and in addition to targeted information campaigns, we have commissioned a project to enhance our existing backontrack.ie website, which we hope to re- launch in mid-2022.

Our aim is to optimise the presentation of our solutions to ensure greater comprehension and appeal.
Finally, I want to thank the staff of the ISI for their hard work and dedication during 2021 and I am looking forward to us working together with all our stakeholders in 2022.

Michael McNaughton April 2022 2 Insolvency Service of Ireland 2 The ISI – What We Do The ISI is an independent statutory body established in 2013 to deal with personal insolvency.

We aim to return people to solvency and full participation in social and economic activity.
The principal functions of the ISI are set out in section 9 of the Personal Insolvency Act 2012 (the “Act”).
These include: To contribute to the development of policy in the area of personal insolvency To operate the system to support the three alternatives to bankruptcy – Debt Relief Notice (DRN), Debt Settlement Arrangement (DSA) and Personal Insolvency Arrangement (PIA) To prepare and issue guidelines as to what constitutes a reasonable standard of living and reasonable living expenses for debtors ISI Seirbhis Dóchmainneachta na hÉireann Insolvency Service of Ireland To administer the estates of bankrupts To promote public awareness and understanding of the personal insolvency solutions available to people To regulate authorised practitioners around the country who offer personal insolvency advice and who assist debtors in seeking a DRN, DSA or PIA 3 Annual Report 2021 3 The ISI – Who We Are Michael McNaughton Director Responsible for the overall management and control of the ISI’s staff, administration and business.
Trevor Noonan Case Management Responsible for managing and processing the three debt relief solutions under the Personal Insolvency Acts 2012 to 2021 and operating the Information Line.

Liza Doyle Legal Services Responsible for the provision of legal services to all divisions of the ISI.

Ian Larkin Official Assignee (OA) Bankruptcy Responsible for the administration of bankruptcy estates under the Bankruptcy Acts 1988 to 2015.
John Phelan Policy, Regulation and Corporate Affairs Responsible for research and policy development, the regulation and supervision of personal insolvency practitioners (PIPs) and approved intermediaries (AIs), all governance matters and the provision of a range of support services.
4 Insolvency Service of Ireland 4 Infographics – 2021 Statistics at a Glance 1,221 Protective Certificates issued – 88% of which were for PIAs, the solution that deals with mortgage debt The representative sample from the Abhaile Deep Dive exercise in 2021 shows that, of those borrowers who availed of a PIA, 100% had terms which saw them remain in their family home while 44.6% of debtors had a reduction in their mortgage debt through a write-down of the principal 1,193 debt solutions put in place 85 PIPs + 10 AIs authorised at year end 1,203 Abhaile vouchers issued for a free PIP consultation 199 people adjudicated bankrupt with 135 people exiting bankruptcy €1,196,609 in dividends paid from bankruptcy estates to creditors 83 family homes re-vested 7Bankruptcy Payment Orders were granted 74,146 visitors to ISI websites 99% of visitors to Back on Track were new visitors 285 new section 115A applications lodged, down from 402 in 2020 5 Annual Report 2021 5 Operations The ISI administers four distinct schemes to allow people in debt to seek to resolve their debt problems – DRN, DSA, PIA and Bankruptcy.
The ISI has facilitated over 12,000 solutions for insolvent debtors since its inception over eight years ago1.

5.1 Protective Certificates and Arrangements Affected by Covid-19 The decline in total Protective Certificates and Arrangements from 2019, seen in 2020, continued through 2021 albeit at a slower rate.
This may have been due to factors relating to the ongoing Covid-19 pandemic and its effects on the uncertainty of individuals’ personal circumstances, causing new applications to be deferred and those applications already submitted to Court adjourned until a greater degree of certainty existed which would help in achieving more sustainable debt solutions going forward.

Continued government supports and a decrease in possession hearings in the Courts are also likely to have impacted numbers.
While the numbers of PIAs and DSAs fell, we did see an increase of 62% in those availing of the DRN process.

1 Every quarter the ISI publishes on its website detailed statistics covering its work.
1600 1400 1200 1000 800 600 400 200 0 Approved Insolvency Arrangements and Bankruptcies (2017 - 2021) 1,312 1,448 1,232 1,193 1,115 473 397 263 130 199 2017 2018 2019 n Arrangements n Bankruptcy 2020 2021 Figure 1: Approved Insolvency Arrangements and Bankruptcies (2017 – 2021) Protective Certificates by Type 2021 & 2020 PIA DSA Total 145 208 1,076 1,194 nnn 2021 nnn 2020 1,221 1,402 0 200 400 600 800 1000 1200 1400 1600 Figure 2a: Recent Trends – Protective Certificates 6 Insolvency Service of Ireland Arrangements by Type 2021 & 2020 925 1,020 PIA DSA DRN Total 84 99 184 113 nnnn 2021 nnnn 2020 1,193 1,232 0 200 400 600 800 1000 1200 1400 Figure 2b: Recent Trends – Arrangements New Cases submitted by type 2021 & 2020 2500 2000 1500 1000 1 5 4 2 , 0 7 1 2 , 8 2 3 1 , 2 9 9 PIP Activity: Number of Protective Certificates 2021 1 to 10 PCs 11 to 49 PCs 20 20 500 8 8 1 2 2 1 8 4 1 9 5 1 0 DRN DSA PIA Total nnnn 2021 nnnn 2020 50+ PCs 4 0 Number of PIPs Figure 3: Recent Trends - New Applications Figure 4: Number of Protective Certificates by Number of PIPs 2021 PIP Activity: Number of Arrangements 2021 1 to 10 Arrangements 11 to 49 Arrangements 50+ Arrangements 6 21 18 0 Figure 5: Number of Arrangements by Number of PIPs 2021 Number of PIPs 7 Annual Report 2021 5.2 Bankruptcy Cases Affected by Covid-19 The number of people entering bankruptcy was 199, up 53% from 130 in 2020.
It should be noted that in comparison to England, Wales and Northern Ireland (being our closest comparable jurisdictions), Ireland’s rate of bankruptcies per head of population continues to remain lower.
Comparable Bankruptcy Figures Jurisdiction Ireland 2021 199 2020 130 England & Wales 8,688 14,112 Northern Ireland 107 204 Figure 6: Bankruptcy adjudications by jurisdiction Despite the increase of 53%, the overall number of individuals being adjudicated bankrupt has remained relatively low and is indicative of a longer-term reduction in the number of people seeking bankruptcy (2019 – 263 cases).
The increase in cases in Ireland in 2021 was opposite to the trend in Northern Ireland and England and Wales, where the numbers continued to reduce in 2021.

The number of debtors petitioning the High Court for their own bankruptcies was 169, compared to 118 in 2020, an increase of 51.

There were 30 creditor-petitioned bankruptcies compared to 12 in 2020, an increase of 18.

The complexity of the administration of bankruptcies remains challenging.
2021 Case Type 2021 Breakdown Petitioning creditor Self-adjudication 15.07% 84.93% Figure 7: Bankruptcy adjudications by petitioner type Description Sale of securities Proceeds from land and building Proceeds from debts due and other sources Rental income from properties Income Payment Orders Encashment of pension plans Total Amount €2,446,163 €2,755,720 €1,224,297 €582,271 €561,006 €425,888 €7,995,345 Figure 8: Bankruptcy asset realisations €7.995 m The value of assets realised €1.196 m The value of dividends issued to creditors 135 The number of people who exited bankruptcy 199 The number of new bankrupts 83 The number of homes re-vested in the former bankrupt 7 The number of Bankruptcy Payment Orders approved by the High Court 13 The number of orders for the extension of the bankruptcy term (1 interim and 12 final) granted by the High Court due to non-compliance 8 Insolvency Service of Ireland 5.3 The Year Ahead The ISI conducted and concluded an extensive procurement exercise in 2021 in relation to acquiring a new bankruptcy case management system (BCMS).
The planned objective will be to award a contract and implement the new BCMS during 2022.

Aligned to the BCMS implementation, the division will also continue to monitor and improve its operations to foster an innovative and efficient approach to reaching its business goals and objectives.

These factors should contribute to the orderly management of estates providing debtors with the benefits of the bankruptcy system and result in the prompt realisation of assets and payments of dividends to creditors.
5.4 Court Review of Rejected PIAs (Section 115A Reviews) Section 115A of the Act which was introduced in late 2015 provides for a mechanism where proposed PIAs that have been rejected at the statutory creditors’ meeting can be subject to a court review.
The provisions relating to this section of the Act were further amended in 2021, the principal change being the removal of the requirement that a debtor had to have been in arrears at 1 January 2015 or, having been in arrears before 1 January 2015, had entered into an alternative repayment arrangement with the secured creditor concerned.

A PIP, acting on instruction from a debtor, can make an application for an order from the Court confirming the coming into effect of the proposed PIA.
Where the Court review is successful, the Court grants this order and the PIA comes into effect.

The table overleaf shows the number and status of section 115A review applications received and progressed up to the end of the year.
5.4.1 SECTION 115A COURT REVIEWS AS AT END DECEMBER 2021 The majority of review applications are generally decided on the basis of arguments put forward that relate to the commercial merits of each case, including the sustainability of proposals and the extent of alleged unfair prejudice suffered by creditors.
The conclusion of live cases has continued to be a challenge in 2021 given the circumstances around many debtors during the Covid-19 pandemic, and many such cases are likely to remain live until certainty is brought to debtors’ circumstances going forward.

Notwithstanding these delays, the Courts are continuing to stress the need to have cases concluded at the earliest possible opportunity.

Another factor in this regard is the number of appeals of Circuit Court decisions.
In this regard, a small number of cases are ones in which the outcome of one specific matter may be relevant to the progress of a larger number of other cases.

However, it is also noticed that there appears to be an increase in the number of cases being resolved through settlement negotiations, which is likely to assist in minimising the delays in case resolutions.

The ISI has observed a downward trend in the number of objections being filed to applications made under section 115A.
The number of applications made (285) shows a significant decrease on the 2020 figure (402), continuing a downward trend that has seen applications fall from 565 in 2018 and 432 in 2019; a factor in this decrease is likely to be attributable in part to a general decrease in the number of applications for debt relief made during the year due to the impact of the Covid-19 pandemic.
However, it may be that the continued emergence of jurisprudence of the High Court, providing clarity on certain aspects of the legislation, could also be a factor.

Furthermore, it is also likely to be reflective of greater levels of engagement occurring between PIPs and creditors with a view to finding appropriate resolutions through discussion and variation of proposals ultimately approved by Courts.
In the meantime, the ISI continues to keep stakeholders informed of developments through its periodic e-Briefs.
9 Annual Report 2021 S115A Applications in 2021 282 Creditor Objections 173 (63%) Arrangements Approved to Date On Review On Review - Creditor Appeal Active Confirmed on Creditor Appeal On debtor Appeal Total % Uncontested On Consent On Consent - Subject to Variation Contested Total Arrangements Approved 377 94 125 230 826 7 1 17 25 4 4 377 153 184 52 58 40 291 150 1005 49% Arrangements Not Approved On Review On Review - Debtor Appeal Active Revoked on Creditor Appeal On debtor Appeal Total % Withdrawn On Consent Refused Total Arrangements Not Approved Total Applications With Decisions Active Applications on Review Total applications Made 22 168 500 690 1516 146 159 305 1 1 22 314 719 1055 51% 26 455 2060 59 59 63 336 2396 *The ISI is aware that there are cases where a creditor objection is recorded as upheld but where a settlement has been reached following negotiations between the debtor and the objecting creditor, but no data is available.
Summary of Significant Court Rulings in 2021 The table below sets out significant decisions of the High Court during 2021, the majority of which were brought under section 115A.

These are also available on the Courts website www.courts.ie.
Case Cremin Barry Horan Quirke Fennell Kirwan Main issues dealt with Relevant debt; sustainability; appropriateness of PIA Protective Certificate validity Relevant debt; setting aside of rental payments Special circumstances costs; affordability; costs of the PIA; debtor conduct Mortgage term extension (section 115A) Mortgage term extension (section 115) Fitzpatrick/ McKiernan Insolvency in the context of future warehouse repayment Pension benefits Gallagher Income assessment and confirmation Drew Relevant debt Date Hyperlink to judgment 05/02/2021 04/03/2021 12/03/2021 16/03/2021 29/04/2021 15/05/2021 27/08/2021 02/11/2021 15/11/2021 10 Insolvency Service of Ireland 5.5 Project Phoenix The ISI has gathered feedback from external and internal stakeholders about the functionality and interface of the Phoenix case management system.
This system was originally implemented in September 2020, and allows PIPs and AIs to submit cases for DRNs, DSAs and PIAs to the ISI.

Having identified a set of enhancements to make the software more efficient and easier to use, the ISI is working with the software provider to improve specific functions of Phoenix to make it easier to enter, progress and manage cases.

This work is taking place as part of the ISI’s functions to manage and process applications and maintain registers.
5.6 EU Interconnector Project The EU Insolvency Registers allow for searching for insolvent entities, either natural or legal persons, within the EU.

Thirteen EU countries are currently integrated with these registers, to allow searching of insolvent entities in those countries.
The ISI is engaged with the Courts Service (Office of the Examiner) and the Companies Registration Office to provide consolidated information to the EU Insolvency Register to ensure that insolvent entities in Ireland appear in response to search queries on the EU Register.

This project was initiated in 2021, and is expected to go live in 2022.
This work is taking place to ensure compliance with Article 25 (Interconnection of insolvency registers) of Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings.

Having identified a set of enhancements to make the software more efficient and easier to use, the ISI is working with the software provider to improve specific functions of Phoenix to make it easier to enter, progress and manage cases.
11 Annual Report 2021 6 Legislation In 2017, the Department sought the views of interested parties on the operation of Part 3 of the Personal Insolvency Act 2012.

Part 3 provides for the definition and operation in practice of the three debt resolution processes available to insolvent debtors (DRNs, DSAs and PIAs).
The ISI made a comprehensive submission to the Department, identifying areas that provide challenges to the efficient operation of the insolvency process and made recommendations in relation to a number of areas that could deal with those challenges to the benefit of all stakeholders.
In 2020, the ISI reviewed its submission to ensure the recommendations were still current and to see if new recommendations should be proposed, with the goal of driving efficiencies, reducing barriers to entry and otherwise improving the overall process.

In May 2021, some urgent amendments were introduced through the Personal Insolvency (Amendment) Act 2021 (No.

10 of 2021).
10 of 2021).

The new legislation makes a small number of important changes to the law on personal insolvency to deal with the effects of Covid-19.

It provides for virtual meetings between debtors and insolvency advisors, and makes it possible for people who have gone into mortgage arrears to seek a court review of their proposed Arrangement if creditors vote against it.

Where a debtor seeks help and obtains a protective certificate, creditors cannot contact them or pursue debts for 70 days.
The new legislation provides for a court to extend that 70-day period by a further 40 days in exceptional circumstances.

The Act also makes it easier for a debtor to qualify for a DRN, under which people with few assets and little spare income can have debts up to €35,000 written off.

It also enables PIPs to delegate more tasks to a member of their staff or a colleague including, for example, chairing a meeting of creditors.
The ISI expects that other important changes to the personal insolvency legislation will follow soon in a second Bill and will continue to work closely with the Department of Justice to progress these necessary changes.

The ISI expects that other important changes to the personal insolvency legislation will follow soon in a second Bill and will continue to work closely with the Department of Justice to progress these necessary changes.
12 Insolvency Service of Ireland 7 Communications The ISI has a dedicated Communications Project Group.

The group comprises cross-divisional representatives of the organisation and is tasked with planning and coordinating communications activities to ensure that key messages are disseminated through the appropriate channels to each stakeholder.
During 2021, this group coordinated information campaigns, liaised with the media, and ensured that ISI websites, publications and related information sources were readily accessible to our target audience.

The campaign was developed following an evaluation of the effectiveness of the split campaign that ran over the first four months of the year.

The campaign included video on demand, digital audio and radio advertising and a live stream webinar.
7.1 2021 Information Campaign Similar to previous years, the ISI ran a significant ‘Back on Track’ campaign (www.

backontrack.ie) at the start of the year, which is a time when people are reflecting on their Christmas spending and possibly in financial difficulty.

The campaign ran in two bursts between January and the end of April.
The objective of the campaign was to continue to increase awareness and understanding of the debt solutions provided for in insolvency legislation and to encourage more openness around discussing debt problems.

The key message of the campaign was how overwhelming debt can be and the sense of relief felt once a person asks for help.
The target audience remained largely similar to previous campaigns, those who are 35+ and struggling financially, with a particular focus on those sectors where people were affected by the Covid-19 pandemic, i.e.

hospitality, entertainment, transport, retail, etc.

As people receive and absorb information in different ways, a range of different approaches was used in order to maximise the effectiveness of our communications.
Various media channels were used for the campaign, including TV, video on demand, digital display, radio, digital audio and press advertisements.

The campaign highlighted how overwhelming debt can be and the sense of relief a person gets once they take control of their situation and ask for help.

To coincide with the campaign, the ISI’s Director also took part in a number of radio interviews urging people in debt to take control of their situation, contact a PIP or AI to find out what their options are.
The campaign performed strongly across each media channel and met key performance indicators.

A subsequent campaign consisting of three two-week bursts also took place between June and November.

Throughout the year the ISI also reached out to a number of organisations and agencies who may have contact with people with debt problems.

7.2 Government Unified Identity During the year the ISI also adopted the unified Government of Ireland identity.
The introduction of the unified identity is part of an initiative to streamline government communications and make engagement with citizens simpler and better.

This is particularly important to the ISI as we want people with financial difficulties to know that they can trust the ISI to provide them with the information they need.
7.3 ESRI Research Over 2021, the ESRI conducted behavioural research on behalf of the ISI on the uptake of its debt solutions, specifically with a view to employing behavioural science to assist borrower engagement with the insolvency process and the range of personal insolvency solutions available.
The research included the design of an experiment in which over 1,000 individuals took part and set out to understand how the presentation of the relevant information on the different solutions is perceived and acted upon by potential debtors and how that presentation might be improved to ensure greater comprehension and appeal.

7.4 New Back on Track Website The ISI went out to tender in 2021 for the development of a new website to replace the current backontrack.ie, which was initially developed in 2014.
A contract was awarded to the most economically advantageous tenderer and work will get underway in early 2022 on the new website, taking learnings from the ESRI report into consideration, along with what we already know about our target audience.

13 Annual Report 2021 8 Abhaile Abhaile, the ‘Scheme of Aid and Advice for Borrowers in Home Mortgage Arrears’, was launched on 22 July 2016 and is coordinated by the Departments of Justice and Social Protection.
It is jointly operated by a number of agencies including the Money Advice and Budgeting Service (MABS), Legal Aid Board, Citizens Information Board and the ISI.

The scheme, which runs to the end of 2022 following an extension announced by the Government in September 2019, provides a range of services to help people in mortgage arrears and offers free access to financial and legal advice through panels of qualified and regulated professionals by way of a voucher issued centrally by MABS.
ISI maintains a panel of PIPs who are funded to provide independent financial advice and assistance free of charge to eligible borrowers, and processes claims from these PIPs.

A new Abhaile PIP panel became operational from early March 2020 following a revision of the terms and conditions and as of 10 December 2021, there were 52 PIPs on the panel.

An updated version of the Terms and Conditions was issued on 10 December 2021 on foot of the Personal Insolvency (Amendment) Act 2021.
The update included the removal of the restriction whereby only borrowers in mortgage arrears on or before 1 January 2015 were eligible to apply for a section 115A review and the inclusion of digital meetings as a consultation method.

The Abhaile scheme allows for a seamless flow of information between MABS and PIPs in particular, which is important when endeavouring to reach and help borrowers in an integrated way at the most appropriate time.
In 2021: • 1,203 vouchers were issued to borrowers for a free consultation with a PIP according to MABS records and • PIPs who completed borrower consultations redeemed 946 vouchers.

The number of Abhaile PIP vouchers issued and subsequently redeemed in 2021 decreased in comparison with 2020 by 34.37% and 42.77% respectively.
This reduction in activity is largely attributed to the impact of Covid-19, including the continuance of the government supports, less pressure from mortgage creditors and the decrease in possession hearings in the courts.

Nonetheless, there was a continuance in 2021 of the positive trend observed in the previous year where the majority of borrowers engaging with PIPs are in the greater than two years mortgage arrears category, which is the scheme’s target audience.
Analysis of the outputs of the Abhaile PIP panel from launch of the scheme to the end of 2021 is now presented followed by a deeper analysis of the outcomes for debtors whose vouchers were redeemed by PIPs in Q3 2020.

In summary, solutions are being achieved for borrowers through the Abhaile PIP panel in a timely manner, with MABS colleagues being an important source of referrals.
84.5% of the borrowers involved are those in the difficult category of over two years in mortgage arrears and 73% were recommended a statutory solution.

8.1 Analysis of the Abhaile PIP Panel – Outputs and Borrower Outcomes There are two forms of indicator used to analyse the success of the PIP panel through the Abhaile scheme: A.
Output indicators which provide background information relevant to the uptake of the scheme through PIP voucher issuance and redemption (shown below from the launch of the scheme in 2016 to the end of 2021); and B.

Outcome indicators which show the outcomes achieved as at August 2021 for borrowers for whom PIP vouchers were redeemed in Q3 2020 (based on a representative sample from the ‘Deep Dive’ exercise).
14 Insolvency Service of Ireland 12,669 vouchers were redeemed by PIPs since the beginning of the scheme to December 2021 3% were recommended bankruptcy The total value of the debt for these vouchers amounted to €6.068 billion 4% were recommended the Mortgage to Rent Scheme 15% were recommended alternative informal solutions A. ABHAILE OUTPUT INDICATORS The total value of mortgage debt for these vouchers amounted to €3.71 billion The total negative equity* for these vouchers amounted to €791 million 72% were recommended a formal solution through a Protective Certificate application 57% of borrowers were either referred from MABS (43%) or were facing court proceedings for repossession (14%) 75% of borrowers who engaged were in mortgage arrears for more than 2 years * Negative equity – the value of the property is less than the mortgage owed Annual Report 2021 15 15 Annual Report 2021 B. OUTCOMES – DEEP DIVE 2021 ANALYSIS Under the scheme, the PIP reviews the borrower’s financial circumstances and makes a recommendation to address their financial difficulties.
The purpose of the annual ‘Deep Dive’ is to examine what has happened to the borrower following this recommendation.

Such an examination can only take place in retrospect since ISI data shows that for cases that resulted in a PIA in 2021, on average it took just over six weeks to obtain a Protective Certificate once the case was submitted and a further thirty-four weeks (over eight months) for an Arrangement to be approved by a court.
The ‘Deep Dive’ analysis conducted in 2021 relates to 374 borrowers for whom a PIP redeemed a voucher in Q3 2020.

A breakdown of the outcomes achieved for these borrowers as of August 2021 is provided immediately below (Figure B1).

The infographic that follows provides an overview of the main findings of the Deep Dive.
• There are 160 (43%) borrowers that have solutions in place; both formal (27%) and informal (16%) – of these solutions, 101 are PIAs, 58 are informal solutions (including 20 who successfully applied for Mortgage to Rent) and 1 case where the borrower has been adjudicated bankrupt.
• 81 borrowers (22%) are working with their PIP to find a formal solution – of these 42 are in the section 115A review process, 27 are considering a formal solution, 11 plan to reapply for PIAs after their initial Arrangements were pursued and rejected, while 1 borrower is considering petitioning for bankruptcy.

• 31 borrowers (8%) are in the process of seeking an informal solution – of these 15 are working with their PIP on securing an informal Arrangement.
In addition 14 have been referred back to MABS for support while the remaining 2 have been referred on to third parties to pursue informal Arrangements.

• 79 borrowers (21%) did not engage further following receipt of the PIP’s recommendation.

Please note that PIPs continue to try to engage this cohort on an ongoing basis.

• 23 borrowers (6%) are classified as on hold.


Of these, 22 borrower solutions are on hold due to Covid-19 related income issues while 1 borrower solution is on hold pending a divorce.

In each instance, the recommended solution for these borrowers was to proceed with a PIA application.

On Hold (Covid, Divorce etc.)
23, 6% Not Engaging 79, 21% In process to informal solution 31, 8% Formal solution in place, 102, 27% Informal solution in place, 58, 16% In process to formal solution, 81, 22% Figure B1: Breakdown of borrower outcomes from Q3 2020 as relayed by PIPs in August 2021: 374 borrowers in sample 16 Insolvency Service of Ireland 84.5% of borrowers in the sample were in mortgage arrears for over 2 years when they sought advice from a PIP 73% were recommended to pursue a formal Arrangement under the Personal Insolvency Act 2012 61% of all the Arrangements in 2021 were approved by non-traditional creditors €101,242 was the median write-down €136,089 was the average write-down B. Outcomes – Deep Dive 2021 Analysis 58% have been referred to their PIP through MABS 100% of those who have a personal insolvency Arrangement in place have remained in their homes 44.6% of Arrangements included a write- down on the mortgage 101 personal insolvency Arrangements put in place 88% of Arrangements were approved at the creditors’ meeting Figure B2: Arrears capitalisation followed by term extension were the most prevalent mortgage restructure types found in Arrangements for both traditional and non-traditional creditors.
The third most popular restructure type - principal reduction / write-down - is more popular among non-traditional creditors.

17 Annual Report 2021 9 Stakeholders The ISI acts as an authority on the statutory personal insolvency options available to individuals in financial difficulty.
To this end, the ISI engages with a broad range of stakeholders and aims to provide them on a regular basis with statistical data and trends of interest with respect to the uptake of these options given the ever-evolving environment in which the personal insolvency legislation operates.
Of particular significance is the ISI’s ongoing engagement with a number of key stakeholders such as the Association of Personal Insolvency Practitioners (APIP) and creditors through the Banking and Payments Federation Ireland (BPFI).

The ongoing impact of the Covid-19 pandemic has highlighted the importance of all stakeholders working together to achieve fair outcomes for debtors and creditors.
Despite prevailing challenges during the year, the personal insolvency framework has embraced legislative and procedural changes instigated as a response to the pandemic and, in doing so, the efficiency of the framework increased for all stakeholders, including those individuals in need of assistance.

9.1 Reasonable Living Expenses (RLEs) The ISI is required to prepare and issue guidelines as to what constitutes a reasonable standard of living and reasonable living expenses (RLEs).
In mid- 2021, the ISI conducted a comprehensive public consultation on RLEs, the main purpose of which was to inform all stakeholders of proposed changes to the RLEs.

This consultation followed a review of the Minimum Essential Standard of Living (MESL) by the Vincentian Partnership for Social Justice (VPSJ) and was intended to obtain submissions on the composition of RLE set costs figures and feedback on the approach to practical implementation of changes to set costs.
The public consultation has concluded and the responses have been considered.

Revised RLE guidelines are expected to issue in early 2022 following publication of a feedback report.

The ISI continues to engage actively with the VPSJ.

In December 2021, the ISI participated in a webinar hosted by the VPSJ on ‘MESL – A Reference Budget, Twenty Two Years in the Making’.
This webinar detailed the work of the VPSJ in providing evidence- based data on income adequacy by establishing a minimum essential standard of living for all.

9.2 Protocol Oversight Committee The committee was established in 2015 to promote and monitor the practical implementation of the DSA and PIA Protocols agreed by the various stakeholders to enhance the overall operation of the insolvency framework.
The committee, comprising representatives of creditors, debtor groups, PIPs and others, met in September 2021.

Work is ongoing by the Protocol Oversight Committee to consider: (i) a Statement of Income and Expenditure at annual review stage; (ii) variation documentation and (iii) a dividend payments schedule.

9.3 Stakeholder e-Brief There were two stakeholder e-Briefs published in 2021, in June and December.
These are one of the core channels of communication for the ISI with its broader stakeholder community.

The e-Brief, published on the ISI website, provides a concise overview of activities within ISI and other significant developments for the purpose of facilitating the ongoing development of the personal insolvency framework.
In particular, the e-Brief summarises the pertinent detail of relevant court case decisions to highlight the evolution of statutory solutions over time and issues of interest, with direct links provided to written court judgments.

9.4 PIP Newsletter A PIP newsletter issued in June 2021.
These newsletters, which are issued to all authorised PIPs by email, are used to update PIPs on policy, technical issues and practical items in respect of interacting with the ISI, particularly through its case management system.

PIP newsletters are archived and available through the PIP professional development portal.

The portal and newsletters are intended to act as a repository of information for practitioners, including those recently authorised.
9.5 PIP Authorisation & Renewal Meetings Five individuals were authorised to carry on practice as a PIP in 2021 following a process involving at least one meeting with the ISI Regulation Division.

18 Insolvency Service of Ireland The authorisation interval for PIPs is three years.

Thirteen PIPs were due for renewal during the year.

Of these, two PIPs made a decision not to seek renewal of their authorisation while a further one application was still in review.
There are different operating models employed by PIPs and, in circumstances where fewer than three court- approved Arrangements are put in place in the preceding three-year period, PIPs wishing to renew their authorisation in 2021 were requested to meet with the ISI Regulation Division.
The purpose of such meetings was to establish if the resources (including financial capacity), policies, procedures, systems and controls necessary for a PIP to comply with their obligations under the Act and regulations made under the Act remain adequate and in place.

In addition, the meetings were an opportunity to build relationships and to discuss opportunities and challenges for the PIP community.

Eight such meetings were held in 2021.


Further, three PIPs requested a cessation of their authorisation prior to the renewal being due.

9.6 Continuous Professional Development (CPD) for PIPs In consultation with the ISI, APIP identified a number of areas for focus in respect of CPD for PIPs.

APIP developed and ran a comprehensive programme of webinars in the months between March and July 2021.
These webinars were recorded for ease of subsequent access for PIPs through the professional development portal in place.

In December 2021, the ISI held a meeting with newly authorised PIPs to discuss their training needs.

Suggestions for further enhancement of the Certificate in Personal Insolvency Practice provided by City Colleges were also discussed.

9.7 Engagement with MABS The ISI continues to engage with MABS as a core stakeholder.
In May, the ISI provided an online webinar to colleagues on request.

A demonstration of the ISI’s Case Management system was provided and issues discussed included DRN statistics and trends of interest.

In November, the ISI met with representatives of MABS and Citizens Information Board to discuss qualifications and CPD in the context of AIs.

On an ongoing basis, the ISI issues notifications as required to AIs regarding ISI’s policy positions relevant to the processing and supervision of DRNs.
9.8 Creditor Engagement The ISI conducted a series of dialogue meetings throughout 2021 with the main retail lenders, credit servicers and funds.

The purpose of these meetings is to gather feedback on the implementation of These newsletters, which are issued to all authorised PIPs by email, are used to update PIPs on policy, technical issues and practical items in respect of interacting with the ISI, particularly through its case management system.
19 Annual Report 2021 9.11 Court Arrangements In March 2020, in response to requests made on behalf of the PIP profession and to developments regarding the spread of Covid-19 and the need to ensure business continuity in extraordinary circumstances, a protocol was agreed with the specialist judges of the Circuit Court, which was circulated to relevant stakeholders.

This protocol provided for remote hearings of insolvency cases.
Throughout 2021, the vast majority of court hearings continued to be conducted remotely.

provisions in the Personal Insolvency Acts 2012 to2021 and to facilitate discussion on issues influencing the personal insolvency framework as it evolves.

These regular dialogue meetings seek to ensure an open channel of communication to share trends and feedback.
As seen from the analysis of the Abhaile ‘Deep Dive’ provided earlier in the report, there is a trend in recent years towards the greater involvement of funds in Arrangements approved.

The ISI continues to liaise with the Central Bank of Ireland, the Irish Banking Culture Board and the Banking and Payments Federation Ireland (BPFI) in the context of aligning relevant work programmes.
9.9 PIP/Creditor Engagement In November 2021, a high-level meeting took place between APIP and creditor representatives facilitated by the ISI and the BPFI.

The purpose of this meeting was to allow discussion on strategic matters of mutual interest and their impact on the personal insolvency framework, including promotion of statutory debt solutions.
9.10 International Association of Insolvency Regulators (IAIR) The ISI continued to engage with IAIR in respect of remaining abreast of international issues in personal insolvency in addition to availing of networking opportunities to share good practices.
During the year, the ISI participated in the IAIR annual general meeting and also in webinars on early evidence on business insolvency filings after the onset of Covid-19 (February) and on predicted volumes of insolvencies and strategies for dealing with such volumes (June).

20 Insolvency Service of Ireland 10 Corporate Updates 10.1 Staffing The ISI has an operational requirement for 86.5 staff.
As of 31 December 2021, there were 78.5 full time equivalents (“FTE”) employed in the ISI when work patterns are taken into account.
The table below shows the staff numbers (FTEs) broken down across divisions: Divisional Breakdown Director Bankruptcy Case Management Policy & Regulation Legal Services Corporate Affairs Total 1 37 22 9 4* 5.5 78.5 * This includes two third-year legal interns working with the ISI for the academic year 10.2 Code of Practice for the Governance for State Bodies In the absence of a statutory board, the ISI has a senior management team (SMT) which meets under the chairmanship of the Director.
The role of the team is to provide strategic leadership, direction, support and guidance for the ISI and to promote commitment to its core values, policies and objectives.

There were 12 meetings of the SMT in 2021.

Generally, where a member was unable to attend a representative attended in their place.

Number of Senior Management Team Meetings Attended applies high standards of corporate governance in line with the requirements set out in the Code of Practice for the Governance of State Bodies (2016).
All appropriate procedures for 2021 with regard to financial reporting, internal audit, procurement and asset disposals were followed by the ISI.

The ISI accounts and internal controls are subject to internal and external audit.

The administration of bankruptcy estates is also subject to independent review with an annual report issuing to the High Court.

The ISI has complied with all its obligations under taxation law.
10.3 Oversight Agreement The ISI and the Department of Justice were party to an Oversight Agreement and Performance Delivery Agreement for 2021.

The agreements document an agreed level of service between the parties.

They set out respective commitments on which performance should be measured and support the mission expressed in ISI’s Strategic Plan of returning insolvent people to solvency and full participation in social and economic activity.
10.4 Public Spending Code The ISI continued to adhere throughout the year to the applicable measures of the Public Spending Code published by the Department of Public Expenditure and Reform.
2021 Budget Expenditure Variance Pay 4,769,000 4,124,983 644,017 Non-pay 2,800,000 3,214,633 (414,633)* Total 7,569,000 7,339,616 229,384 Michael McNaughton Trevor Noonan Liza Doyle John Phelan Ian Larkin As an independent statutory body, the ISI has adopted comprehensive corporate governance structures and procedures to ensure that it 12 12 11 12 12 *As agreed with the Department of Justice’s governance section, a level of funding was sanctioned for the OA in Bankruptcy and was partially funded from savings in the ISI budget.
The Departments of Justice and of Public Expenditure and Reform approved funding of €300,000 in 2020 and €1,100,000 in 2021 by way of using the mechanism under section 21 of the Personal Insolvency Act 2012.

This was 21 Annual Report 2021 made within the overall budget of the ISI due to permission by the Department’s governance unit and the Department of Public Expenditure and Reform, to utilise payroll and other savings for this purpose.
10.5 Risk Management The ISI operates a formal risk management policy and maintains a risk register, in accordance with guidelines issued by the Department of Public Expenditure and Reform.

The risk register is designed to ensure that risks are identified and assessed and that, where necessary, appropriate mitigating actions are put in place.

The risk register is reviewed on a monthly basis at the SMT meeting.
Additionally, the Risk Committee meets quarterly, under the chair of the Director, to review the register and agree any necessary amendments.

Reflecting the key priorities for the organisation, the main potential risks managed by the ISI in 2022 were: • The maintenance of business continuity during the coronavirus pandemic and adapting to a largely remote working environment.

• The approval and management of a number of significant IT projects commenced during the year.
10.6 Freedom of Information (FOI) The ISI continued to meet its obligations under the Freedom of Information Act 2014.

In 2021 the ISI dealt with five FOI requests.

10.7 Data Protection The ISI protects the integrity of data supplied to us by users of our services and third parties.

In 2021, we conducted further staff training to help ensure that we continue to comply with the EU General Data Protection Regulation (GDPR).

The ISI responded to eight data subject rights requests during the year.
10.8 Protected Disclosures Under the Protected Disclosures Act 2014, the ISI is required to publish an annual report on the number of protected disclosures made to it and the action, if any, taken in response to those protected disclosures.

There were no protected disclosures notified to the ISI during the year.

10.9 Customer Charter The ISI’s Customer Service Charter is available on its website, www.isi.gov.ie.

The charter sets out the standards of service a customer can expect to receive from the ISI.
No complaints under the Customer Service Charter were received in 2021.

10.10 Overview of Energy Usage 2021 The ISI must report annually on the energy consumption of its office and on initiatives undertaken to improve energy performance.

The table below sets out the return made by the ISI to the Sustainable Energy Authority of Ireland (SEAI) in compliance with S.I.

No.

426 of 2014.
No.

426 of 2014.

Electricity (MPRN) Gas (GPRN) 2020 2021 269,575kWh 215,548kWh 306,775kWh 180,663kWh The ISI is currently located in building which is rented by the Office of Public Works (OPW) and occupies two of the four floors.

The building has a single meter for both Gas and Electricity, and as sole occupants the ISI has always reported 100% of the meter reading to SEAI.

In 2021 the building had major refurbishments to the ground and first floors leading to increased energy usage.
In 2021 the ISI completed an S.I.

No.

426 of 2014 Energy Audit and is currently working through the feedback received in order to help reduce this figure going forward.
10.11 Contact Us Information Line: 01 764 4200 / +353 1 764 4200 Freetext: ISI to 50015 or Free text GETHELP to 50015 Email: info@isi.gov.ie press@isi.gov.ie Websites: www.isi.gov.ie Facebook: https://www.facebook.com/backontrack.ie Twitter: @ISIbackontrack 22 Insolvency Service of Ireland 11 Appendix 1 Case Studies 11.1 Case Study 1: Bankruptcy Audrey is a separated mother of three teenagers living in Wicklow.
She had a joint residual debt of €100,000, with her ex-husband Richard, as a result of the failure of Richard’s construction business.

When Audrey tried to negotiate a reduction in her liability, which was now unsecured following the liquidation of the construction business, the institution was unable to agree a write- down with her.

Audrey was understandably very upset as the debt was a result of Richard’s failed business venture.
The family home was in negative equity, she was able to service the mortgage with some difficulty from her income but was unable to deal with the large unsecured debt.

11.2 Case Study 2: Long-term Mortgage Extension in a PIA Patrick and Siobhan are a married couple aged 71 and 70.

They live in a three-bedroom end-of-terrace property, which is their principal private residence (PPR).

The couple live in their home alone.

They have two adult children who are each financially independent.
Patrick and Siobhan are both retired, and neither received pension lump sums or gratuity payments when they finished working.

Their only source of income is the State old age pension.

Following consultation with a PIP, they decided to enter into a PIA.

The family home mortgage loan was prioritised during the Arrangement and the family home was retained and will continue to provide a home to this couple of pension age.

In Patrick and Siobhan’s case, the total outstanding secured debt was €91,013.
Following an independent valuation of the current market value of the property, the home was revalued at €160,000.

They also had unsecured debt of €10,000.

Audrey subsequently entered bankruptcy after she was unable to come to any arrangement with the bank in relation to the outstanding debt from the failed construction business.

Audrey is now discharged from bankruptcy and is dealing with being the sole payer on the mortgage but has no other debt to deal with.
When Audrey tried to negotiate a reduction in her liability, which was now unsecured following the liquidation of the construction business, the institution was unable to agree a write-down with her.

The PIP proposed an Arrangement which was accepted by the couple’s creditors.

The secured debt was restructured on the following basis: • Arrears to be capitalised on the successful completion of the PIA.
• The term of the mortgage loan is restructured to 360 months (30 years) from the coming into effect of the PIA.

• Should the last surviving co-borrower die before the end of the 360-month restructured loan term, the full loan balance (plus continuing interest) will be paid from the sale of their PPR by the executors administering their estate(s).
• The full mortgage loan balance will fall due for payment on the expiry of the restructured loan term, or on the death of the last surviving debtor, whichever event occurs first.

• The debtors will pay interest-only monthly mortgage payments of €251 for the duration of the restructured loan term.

• The couple’s unsecured debt will be written off.


23 Annual Report 2021 11.3 Case Study 3: Debt Settlement Arrangement (DSA) with a Secured Debt Sean, a 55-year-old divorced man with no dependent children, is unable to pay his debts as they fall due.

At the present time, Sean is employed as a Sales Rep. Sean was a sole trader in the car trade and was largely dependent on one main supplier.

Sean’s business deteriorated and his income had dried up.

He was mainly collecting outstanding debts.


After consulting with his PIP, Sean was advised to cease self-employment and to find full-time work, which he has done.

The debtor is proposing this Arrangement in an effort to return to solvency.

The PIP considered factors including the debtor's age, earnings and expenses.
However, the debtor and the PIP understand that if this DSA proposal does not secure the support of their creditors at the required creditors’ meeting, they will have to resort to a debtor petition for bankruptcy in an effort to return Sean to solvency.

Sean has a small mortgage on his PPR which is not in arrears, and he can meet the monthly repayments of €400.

This DSA will only address his unsecured debt.


Sean owes €90,200 to his unsecured creditors, €21,195 of which is to financial institutions, €15,000 to his credit union and €54,075 to trade creditors.

The duration of the DSA is 60 months and at the end of the Arrangement Sean will be returned to solvency, with his unsecured creditors receiving a dividend of 21%.

Throughout the Arrangement Sean will continue to pay the mortgage on his PPR and will be in a position to keep his home.
If this DSA proposal does not secure the support of their creditors at the required creditors’ meeting, they will have to resort to a debtor petition for bankruptcy in an effort to return Sean to solvency.

11.4 Case Study 4: Debt Relief Notice (DRN) Affected by Changes Introduced by the Personal Insolvency (Amendment) Act 2021 Louise is a 63-year-old woman with no dependent children.

At the time of her application, Louise lived in a two-adult household, was retired and was the main carer for her partner.
Louise had accrued almost €6,250 of credit card debt, which had become a huge burden and was unsustainable in the long term.

Louise met with an AI, authorised by the ISI to offer a DRN for a debtor wishing to resolve their debt difficulties, and it was agreed that Louise met the criteria for such an insolvency solution upon review of her financial situation.
The Personal Insolvency (Amendment) Act 2021 increased the ceiling for personal assets (including savings) for a debtor to be eligible to propose a DRN from €400 to €1,500.

This increase addressed a potential problem for recipients of certain social welfare payments that are paid in advance lump sums annually or bi-annually, such as Fuel Allowance or Carer’s Support Grant.
Receipt of such lump sum payments into a person’s bank account can result in them temporarily appearing to exceed the €400 ceiling when their financial situation is in fact suited to a DRN.

Louise, as the main carer for her partner, had her Carer’s Support Grant paid into her Post Office account.

At the time of her DRN application she had a balance of €520 in this account.

Louise would not have been deemed eligible for a DRN if she had applied before the amendment to the Act.
Due to the update in the legislation, and as Louise’s financial situation is suited to a DRN, she was eligible to apply for a DRN and it was granted in court.

Louise has now entered the supervision period of three years.

When Louise’s DRN ends, her debt will be written off and she will become solvent.
24 Insolvency Service of Ireland 12 Appendix 2 Further Details and Key Statistics – DRN, DSA, PIA 12.1 Protective Certificates Down 13% in 2021 The number of Protective Certificates decreased in 2021, from 1,402 to 1,221.

The reason for this is likely to be related to the onset of the Covid-19 pandemic in 2020, and the need for PIPs to defer making applications in some cases until debtors’ circumstances had settled somewhat.
This represents a lead indicator of debtors who will, in time, enter into a DSA or PIA.

Protective Certificates issued by Year (2017 - 2021) 2,198 1,958 1,986 1,402 1,221 2,500 2,000 1,500 1,000 500 0 2017 2018 2019 2020 2021 12.2 Court-approved Arrangements Down 3.2% in 2021 The number of Arrangements decreased in 2021, from 1,232 to 1,193.

The decrease is likely to be due to a lower numbers of applications being submitted to the ISI in light of developments related to Covid-19.
In addition, approval of a number of Arrangements was deferred due to many debtors having to avail of Government supports during this period, in the context of the need to assure the courts of the sustainability of those Arrangements.
2021 Arrangements by Case Type 1,400 1,200 1,000 800 600 400 200 0 1,193 925 184 DRN 84 DSA PIA Total 25 Annual Report 2021 1600 1400 1200 1000 800 600 400 200 0 Arrangement Types by Year (2017 - 2021) 5 1 1 1 , 3 3 7 2 1 3 1 , 9 5 9 8 4 4 1 , 5 5 0 1 , 2 3 2 1 , 0 2 0 1 , 3 9 1 1 , 2017 2018 2019 2020 2021 n DRN n DSA n PIA n Total 12.3 PIP Performance The Top 30 PIPs accounted for 978 Arrangements, 97% The Top 20 PIPs accounted for 887 Arrangements, The Top 10 PIPs accounted for 680 Arrangements, 88% 67% of PIP Arrangements (DSA & PIA) of PIP Arrangements (DSA & PIA) of PIP Arrangements (DSA & PIA) 45 PIPs secured at least 1 PIA in 2021 21 PIPs had between 1 and 10 approved Arrangements in 2021 18 PIPs had between 11 and 49 approved Arrangements in 2021 6 PIPs had 50 or more approved Arrangements in 2021 26 Insolvency Service of Ireland 13 Appendix 3 Further Details and Key Statistics – Bankruptcy 13.5 Bankruptcy Payment Order (BPO) BPOs are orders of the Court for the payment by the bankrupt of a defined sum on a monthly basis to the OA for a maximum period of three years.
The order amount is calculated as the surplus of income earned by the bankrupt on a monthly basis over the reasonable living expenses allowed to them under the RLE Guidelines (issued by the ISI) and any allowable special circumstances expenses.

In 2021, 7 BPOs were put in place through the High Court resulting in an average monthly figure of €569 per case being made available for the benefit of creditors.
13.6 Payment of Dividends Dividends with a cumulative total of approximately €1.196 million were paid out to 39 creditors in 104 cases by year-end.

13.1 Family Home/Principal Private Residence (PPR) 83 family homes/PPRs re-vested in former bankrupts under the 3-year rule.

Bankruptcy Division completed 3 settlements with either the former bankrupt or the bankrupt’s spouse in relation to these properties.

The OA took 5 applications to sell his interest in the Family Home/PPR during 2021.
13.2 Investigations and Asset Recovery Bankruptcy is a process that delivers debt relief to bankrupts while transferring all their assets to the OA.

The integrity of the system depends on bankrupts making full disclosure and cooperating with the OA.

This OA will continue his policy to vigorously pursue the recovery of assets not declared.
During 2021, 99 investigations were undertaken; in many instances investigations have resulted in the identification of undisclosed assets such as bank accounts, cars, properties, rental income, and transfers of assets prior to bankruptcy (the figure for the realisation of such assets is in excess of €3 million).
13.3 Enforcement and Compliance The Enforcement and Compliance Team was setup to manage petitioning creditor cases, manage properties in which the OA has rental interest, inspect bankruptcy assets and carry out asset seizures in situ, ensure that bankrupts comply with the terms of their bankruptcy, and, ensure they cooperate fully with the OA.

During 2021, proceedings for non-cooperation led to bankruptcy term extension orders in 13 cases.
Of these 13 orders, 1 was an interim order and 12 were final orders.

The final extension order terms granted were for durations of between 6 months and 12 years.

13.4 Asset Realisations Assets with a value of approximately €7.99 million were realised into 572 bankruptcy estates.

€5.24 million was received from moveable assets and €2.75 million was realised from the sale of immoveable assets.
27 Annual Report 2021 14 Appendix 4 Further Details and Key Statistics – Policy and Regulation Summary of Status of Authorisations Authorised PIPs at end of year New authorisations during 2021 Renewal of authorisations during 2021 Non-renewal of authorisations during 2021 Renewal of authorisation – application in review Cessation of authorisation before expiry Approved Intermediaries at end of year Responsible persons linked to Approved Intermediary authorisations An authorisation as a PIP normally lasts for three years and the first authorisations of PIPs occurred in 2013.
85 5 10 2 1 3 10 82 28 Insolvency Service of Ireland 15 Appendix 5 Glossary of Terms The Personal Insolvency Acts Debt Relief Notice (DRN) Personal Insolvency Acts 2012 to 2021.

A consolidated text, prepared by the Law Reform Commission, can be found here.

The Bankruptcy Acts Bankruptcy Acts 1988 to 2015.

A consolidated text, prepared by the Law Reform Commission, can be found here.
Abhaile - Scheme of Aid and Advice for Borrowers in Home Mortgage Arrears Abhaile is a free service to help homeowners find a resolution to home mortgage arrears.

It provides a range of services to help people in mortgage arrears to deal with their situation and offers free access to financial, legal and insolvency advice.

Approved Intermediary An Approved Intermediary (AI) is a person or class of persons authorised by the ISI to support a debtor to make an application for a Debt Relief Notice.
A list of AIs is available on the ISI’s website.

Bankruptcy Bankruptcy is a personal insolvency process available under the Bankruptcy Act 1988, as amended, where a person cannot pay his/ her debts.

In most cases, once a person has been made bankrupt, an official (the “Official Assignee”) takes control of the person’s property and realises that property to discharge debts of the bankrupt person.
Bankruptcy Payment Order (BPO) BPOs are orders of the Court for the payment by the bankrupt of a defined sum on a monthly basis to the OA for a maximum period of three years.

The order amount is assessed as the surplus of income earned by the bankrupt on a monthly basis over the reasonable living expenses allowed him/her under the Reasonable Living Expense Guidelines issued by the ISI.

A DRN is a solution for people with low income, no mortgage and very few assets.
This solution allows for the write-off of debts up to €35,000 and can be applied for through an AI.

Debt Settlement Arrangement (DSA) A DSA allows a debtor settle their unsecured debts over a period of time (usually up to five years), with any remaining balance written off.

Deep Dive Analysis Detailed review of borrower circumstances, arrangement proposal (if any) and outcomes for Abhaile vouchers redeemed in Q3 of any given year.

The Department Department of Justice.


Formal Arrangement / Solution Statutory debt solutions available Informal Arrangement / Solution Debt solution outside of the statutory solutions available Insolvency Service of Ireland (ISI) The ISI is a statutory body established under the Personal Insolvency Act 2012.

The functions of the ISI are set out in section 9 of the Act.
Official Assignee (OA) The Official Assignee is an officer of the Court, based in the ISI, whose function is to get in and realise the property of a bankrupt, to ascertain the debts and liabilities and to distribute the assets in accordance with the provisions of Bankruptcy Act 1988.

Personal Insolvency Arrangement (PIA) A PIA, while similar to a DSA in respect of unsecured debts, also deals with secured debts.

Secured debts are restructured or settled during a PIA.
It contains a number of protections for debtors in mortgage arrears who wish to retain their family home where possible.

29 Annual Report 2021 Personal Insolvency Practitioner (PIP) Senior Management Team In the absence of a Statutory Board, the ISI has a Senior Management Team that meets under the chairmanship of the Director.
The role of the Senior Management Team is to provide strategic leadership, direction, support and guidance for the ISI and promote commitment to its core values, policies and objectives.

A personal insolvency practitioner (PIP) is a person authorised by the ISI under Part 5 of the Personal Insolvency Act 2012 to act as a PIP.

A PIP liaises between the debtor and their creditors in relation to a PIA or DSA.

A list of PIPs is available on the ISI website.


Protective Certificate A Protective Certificate is a certificate issued by the court that offers a period of protection to a debtor from creditors when applying for a DSA or PIA.

Creditors cannot contact the person during this time.

In general, a Protective Certificate remains in force for 70 days but it may be extended in limited circumstances.
Responsible Person A responsible person is an individual or the person who will provide AI services for the applicant who is a body corporate (responsible person) Reasonable Standard of Living / Reasonable Living Expenses The ISI is required, under section 23 of the Personal Insolvency Act 2012, to prepare and issue guidelines as to what constitutes a reasonable standard of living and reasonable living expenses.
The guidelines are relevant to the assessment of a debtor’s eligibility for a DRN, the formulation of DSA and PIA proposals and the Court’s making of a bankruptcy payment order.

In particular, they are intended to give direction to AIs and guidance to PIPs in assessing, for relevant provisions of the Act, what may be considered ‘reasonable’ in the context of a standard of living and living expenses.

The guidelines are available on the ISI’s website.


30 Insolvency Service of Ireland ISI Seirbhis Dóchmainneachta na hÉireann Insolvency Service of Ireland Block 2, Phoenix House, Conyngham Road, Dublin 8, D08 T3CK Phone: 01 764 4200 | Email: info@isi.gov.ie