BoI posts €1bn loss for 2010
Published 14/04/2011 | 08:47
Bank of Ireland has announced losses of almost €1bn for last year.
The lender, which is about one third owned by the State, issued the figures in its annual report describing 2010 as challenging and difficult.
The pre-tax figures compare with 2009 when it announced losses of €2.2bn.
Bank of Ireland chief executive Richie Boucher said 2011 would remain challenging.
During last year, BoI sold assets worth €9.4bn to the State's "bad bank", the National Assets Management Agency (NAMA). Those deals left it facing losses of €2.2bn.
Mr Boucher said the bank's losses from Nama deals and loans to customers peaked in 2009, reduced last year and would continue to fall in subsequent years.
Bank of Ireland has dramatically reduced the size of its operation since March 2008, cutting its workforce by about 2,400.
The bank's annual report said the losses on bad loans transferred to Nama were higher than expected.
Bank of Ireland has been told it needs to raise another €4.2bn - on top of €3.5bn already given by the State.
The losses before tax hit €950m for 2010, according to the final accounts.
Mr Boucher said the bank would look at its funding deals with subordinated bondholders as a way of hitting the €4.2bn target.
And he suggested the worst was now behind the bank.
"I think we have moved from survival - we are certainly in a stabilisation phase," he told RTE Radio.
Bank of Ireland is to form one of the two new "pillars" of a dramatically reduced Irish banking sector.
Under a Government plan unveiled last month, it will stand alone while Allied Irish Banks (AIB), which announced losses of €10bn on Tuesday, will merge with building society EBS.
AIB has signalled it is looking at a debt forgiveness scheme for struggling mortgage holders but Mr Boucher stopped short of promoting a similar plan at Bank of Ireland.
He said the bank would work on individual cases to resolve the growing problem.
Bank of Ireland figures also showed 4pc of its residential household mortgages are in arrears.
But Mr Boucher said special repayment schemes have ensured that 9,500 customers have had to go into some form of rearranged repayment plan since January 2009.