Figures from the Central Bank show the number of mortgages in long-term arrears of more than 720 days has continued to spiral, increasing by 1,755 to more than 33,500.

There was also an increase in the number of mortgages in arrears for over 360 days reaching 60,422 — 7.9% of the total stock of mortgage accounts.

“The reality is that the 720 days arrears figure is horrible. A day of reckoning is coming for both the banks and mortgage holders in this category. It simply is not sustainable,” he said.

The value of mortgage arrears of more than 720 days is almost €1.4bn — more than half the total value of arrears, which stands at €2.23bn.

Mr Hall accused the banks of cherry-picking which cases they restructure while ignoring the long-term debt crisis.

“While there is a minor reduction in the numbers of those in short-term arrears, there is, however, a very concerning trend of those in long-term arrears being ignored in favour of banks choosing easier arrears cases to solve,” Mr Hall said.

The Central Bank figures for the final three months of last year showed a decline in the number of homes in arrears of over 90 days for the first time.

The number of those homes in arrears fell by 2,262, due to a combination of restructuring and people managing to get their mortgages back on track.

Some 84,000 mortgages were classified as restructured at the end of December, up 4.3% from the end of the third quarter.

Of those, 79.3% were meeting the terms of their restructured agreements.

However, Mr Hall accused the Central Bank of claiming the credit for restructuring while acknowledging that they may not be sustainable.

The Central Bank’s own report says: “It is important to note that ‘meeting the terms of the arrangement’ is not a measure of sustainability, as not all restructure types represent longer-term sustainable solutions.

“For instance, short-term interest only restructures are, in general, not part of longer-term sustainable solutions.”

Mr Hall said: “It is most disingenuous to be claiming credit for restructuring and yet have a massive health warning that these are not sustainable,” he said.

One of the problems highlighted was mortgages restructured through arrears capitalisation, where the arrears are simply added to the mortgage and the problem kicked down the road.

Dublin-based Russian economist Constantin Gurdgiev said this was a clear indication that the process was failing to solve the mortgage crisis and on the frontline it was forcing people into unpalatable decisions: “The process is failing to deliver, we need a human process for a human crisis. Currently, it is failing everyday people and that is the crux of the problem.”