repayments over the next 12 months.

The full impact of the recession on householders has not yet been felt, said Mr. Henry Smith, senior vice president and general manager of retail banking.

Although there have been several cases of the bank seizing and selling the homes of bad debtors, he warned there was worse to come.

"Most of the forced sales we have had to do have not had much to do with the recent economic situation,'' he said.

"These go back some way and concern loans we have been maybe too patient with,'' he said.

"We're very concerned about the future. People are having difficulties now and we're right in the height of our season. It is going to be a difficult winter.

"Unless something drastic happens there will be greater pressures through the winter. We're concerned more people will fall into delinquency.'' The bank was doing all it could to help borrowers through the rough times, said Mr. Smith.

But it was crucial that they came into the bank for help before they got too far behind with their repayments.

"We're working with all of our borrowers,'' he said. "If they get into delinquency they must come into see us before they get in too deep.

"Some people feel guilty that they've got behind with their payments but they shouldn't feel this way. We must get them in the door before the outstanding interest becomes too much of a burden.'' Although the bank was going out of its way to help people with financial problems, it was not prepared to help people who will not help themselves.

"It's usually when a customer shows no interest in trying to meet his commitments that we go out and force a sale,'' he said.

But those people who showed signs of improving their financial health were given every chance to hang on to their homes.

"What we and other lending institutions are doing in order to avert forced sales is to look at ways to carry our customers through either by refinancing the mortgage by putting them on a different payment plan or, say, if someone is out of a job, we look at putting the mortgage on hold and let them pay interest only.

"We sit down on a case by case basis and see if it is a rescuable case. If the customer doesn't try to meet his commitments that's when we go out and sell.'' Mr. Smith said seizing and selling someone's home was a last resort, particularly with the property market in such a depressed state.

In some countries, the situation with bad mortgages was so bad that there were many instances where the value of mortgages was actually more than the mortgaged property.

But this was not the case in Bermuda. Mr. Smith said: "Bermuda's in good shape. All the lending institutions are pretty conservative in their evaluations of property.

"Most of us will only lend up to 65 percent of the appraised value of a property.

"Very rarely do you receive total borrowing in excess of 75 percent of the appraised value. Then, if the market drops by 20 percent, you're still just covered.

"In most cases, there's still ample value in the property to cover the mortgage outstanding.

"Potentially, in this market, we could take some losses but it's very difficult to sell anything. I'm not sure if we've taken any outright losses on forced sales.''