Bank of Ireland has been accused of misleading the public about the number of mortgages it is actually handing out, after it emerged that just half of those who are approved for a loan proceed to draw it down.

In its recent publicity, the bank emphasised how it says "yes" to more than 100 mortgage applications a day.

But in recent correspondence with Fine Gael TD Leo Varadkar, the bank's chief executive Richie Boucher acknowledged that over a typical two-month period, an average of just 55 customers a day actually drew down their mortgage.

"Our experience tells us that customers are seeking mortgage approval in advance of identifying the property that they wish to purchase and as a result it may take some time to actually close on a property and draw down their mortgage," he wrote. "Therefore, any draw-down figures for an equivalent timeframe will not correlate with the approval numbers."

Varadkar said he had been prompted to write to Boucher after seeing Bank of Ireland's TV advertisements on the subject. While he agreed that the state of the current market meant some people were holding off proceeding with their mortgages, he said the bank was also guilty of giving the public "the wrong impression" through its advertising.

He said he was aware of some people being approved for mortgages at levels far below what they had applied for. As a result, the bank could count such approvals for its publicity material, but they were of little or no use to the individual in question.

"I don't think what they are doing is lying. But I do think they are giving people the wrong impression," he said. "They are trying to create this impression that they are lending, they are going out of their way to do this, but the reality is very different.

"I don't think they should go out there and lend like crazy, but I do think we need a new bank that can lend to people. And Bank of Ireland needs to tell the truth."

A Bank of Ireland spokeswoman said the 100-applicants-per-day figure covered situations where an individual had submitted a full mortgage application and received a "letter of offer" (mortgage offer) with approval.

However, she said this was "subject to the customer fulfilling the conditions outlined in the letter of offer. Such conditions will vary depending on customer circumstances."