Irish Life and Permanent slips into the red
Published 03/03/2010 | 09:31
Irish Life and Permanent has reported an operating loss of €196m last year - after a profit of €341m in 2008.
The group put much of the loss down to its banking division Permanent TSB, which was in the red by €270m after setting aside funds for impaired loans in its mortgage and consumer finance divisions.
Chief executive Kevin Murphy described 2009 as a difficult period but said he was confident the group's performance would improve this year, bolstered by increased profitability in the life and pensions businesses.
"The group has focused on reconfiguring the businesses for this new market and had progressed major cost reduction programmes in both the bank and the life company, as well as good progress on customer retention in the life business and strong growth in customer deposits in the bank," he added.
The group's life and pensions arms - Irish Life and Irish Life Investment Managers - recorded a profit of €102m, around €182m less than 2008.
Management said the lower figure reflected the weaker market generally for life and pensions businesses.
At the end of 2009, around 22pc of mortgage accounts were in negative equity, with 3.9pc of mortgages in arrears for more than 90 days.
Mr Murphy said the bank was working closely with customers in financial difficulty to come up with manageable payment schedules.
"The problem of arrears is a real and painful one for customers and we are working closely with customers to agree realistic repayment terms for those in financial stress," he added. "Where customers talk to us we invariably can agree workable solutions with them."
Mr Murphy claimed Irish Life and Permanent was hoping to return to profitability in 2011 and the group was well-positioned to take part in any consolidation which might take place in the Irish market in the coming months.
He said the next steps in this process would follow the introduction of the Government's National Asset Management Agency (NAMA), which was approved by the European Commission last week.