AIB pre-tax profit dips to €1bn in first-half, bank to return €1.8bn to State
Published 28/07/2016 | 07:15
State-owned bank AIB posted a pre-tax profit of €1bn in the first half of the year, according to results released this morning.
The bank is this week to return €1.8bn to the State - €1.6bn for loan notes issued to it as part of the bailout, and €160m of a dividend - it announced.
About half the profit was driven by the bank, with the rest coming from writing back money set aside for bad loans, and a one-off gain from the sale of the bank's stake in Visa Europe.
The pre-tax profit is down from the €1.2bn figure in the same period last year, which saw a higher amount of money for bad loans written back.
Chief executive Bernard Byrne said the results "reflect the underlying strength of the financial performance of AIB and our robust capital position which allows us to continue to support the economies in which we operate".
"We are a customer focused digitally enabled bank and our financial performance, strong franchise and leading market propositions, position us well for future challenges and opportunities," he added.
Lending drawdowns were €3.9bn, up 2pc on the same period last year. Impaired loans were €11.3bn, down €1.8bn in December.
On wrongly removing tracker mortgages from customers, Mr Byrne said the bank's review had found that in some cases it was "not sufficiently clear with customers or we failed to honour contractual commitments."
"On behalf of the bank, I apologise to customers for these failures which should not have happened and which we now intend to put right. We will shortly commence engagement with individual customers affected by this review," he said.
He said he was confident the bank was well positioned to deal with any issues arising from Brexit. Mr Byrne added that the bank continues to engage with potential investors regarding its long-mooted IPO, and is ready to execute it once given approval by the Government.
The bank's net interest margin - a key measure of its health that captures the difference between what it lends out and receives in interest - rose by 0.16pc to 2.08pc, and the bank said further expansion was predicted.