Almost 12,000 struggling homeowners have defaulted on their mortgages with Bank of Ireland.
Chief executive Richie Boucher revealed more than half of the accounts in trouble by the end of March had since entered into a restructuring or a legal process.
But he denied a letter from the bank was a repossession threat, adding that the legal process began when a correspondence from a solicitor was sent and claimed that usually opened up talks.
"We would be extremely disappointed if it goes all the way," he added.
Figures showed 3,103 accounts were classified as being in the legal or resolution process, with another 3,164 made a restructuring offer by the end of June.
Bank of Ireland executives were the second of the country's top bankers to face the Oireachtas Committee on Finance to discuss the financial services sector and activities within the four main lenders. Allied Irish Banks officials appeared on Tuesday, with Ulster Bank and Permanent TSB appearing before hearings later today and tomorrow.
Committee members, including chairman Ciaran Lynch, criticised how Bank of Ireland presented its figures and asked for a breakdown on how many customers were receiving threatening letters or genuine resolution offers.
Sinn Fein's Pearse Doherty said: "I think you're playing this committee for fools."
The bank revealed that as of June, nine out of 10 of its mortgages were performing, but 3,603 owner-occupied and 776 buy to let accounts were 90 days or more in arrears/impaired.
Ulster Bank chief executive Jim Brown, who also appeared before the Finance Committee, revealed 18,025 of the bank's mortgage accounts were in arrears of more than 90 days.
Of those, 8,868 accounts were in some sort of an arrangement with the bank.
Some 4,038 customers had entered a long-term formal arrangement, around 500 were in a short-term plan, such as a payment holiday, while another 4,000 were in some form of informal arrangement.
Mr Brown said around 3,000 customers in arrears had not engaged with the bank at all and that officials were trying to engage with them before any legal action was taken.
Around 4,900 customers in arrears are currently in the legal process, while rent receivers have been appointed regarding a further 1,000 customers.
The bank confirmed it had achieved targets set by the Central Bank to have ensured at least 20% of its defaulting customers had entered a long-term formal repayment solution by the end of the second quarter.
Mr Brown suggested people in work and with means to pay their mortgage are refusing to do so.
He said there was no correlation between the unemployment rate and levels of mortgage arrears - unlike in similar jurisdictions such as Northern Ireland.
"In most markets the unemployment rate is directly correlated to mortgage arrears, so the higher the unemployment rate is, the higher mortgage arrears tend to become," Mr Brown told the committee.
"We've done some analyses across Northern Ireland, which has experienced similar distress to the Republic. Up until 2011, that correlation held. Since then in Northern Ireland, that has continued to be the case. Where unemployment has moved up, mortgage arrears have risen.
"But in the Republic, unemployment has come down from a peak, while in the same period mortgage arrears across the market has increased."
The finance chief said the threat of legal action was the only "tool" the bank has available to encourage defaulters to engage with it.
He said it was "not fair" that so-called strategic defaulters were simply choosing not to pay their mortgage.
Mr Brown said 35% of the bank's total mortgage arrears portfolio were not engaging and not paying anything.
He said fear may be an element of their refusal, but there was no way to know because there had been no engagement with them.
Ulster Bank has been able to contact 71% of mortgage arrears customers within the last three months.