Permanent TSB has made a record loss for the first six months of this year.
The State-owned bank's interim results show an increase in its after-tax losses to €566m, compared to a profit of €413m at the same time last year.
More than 14% of the lender's residential mortgages are now in arrears for more than 90 days - a 2% rise compared to the first half of 2011.
The PTSB chief executive Jeremy Masding said that that while the figures are no surprise, they highlight the challenge ahead.