AIB is ready to float, but long-term will need another string to its bow
AIB has come out the other side of the crash, it is profitable and primed to benefit as the Irish economy recovers further.
The results published yesterday highlight the normalisation of a bank where the scale of collapse can sometimes be overlooked, mainly due to comparisons with the even worse Anglo Irish Bank. AIB may not have been all that bad by Irish standards but by world standards it was a real basket case.
Now though, if the political stars hold good for him, Michael Noonan will preside over the return of at least some of AIB to the private sector, and an associated windfall for the Exchequer. Fine Gael will be able to present itself as the party that took money out of the banks, in contrast to Fianna Fáil which pumped money in.
It took massive taxpayer support, coupled by remedial action within the bank itself, the latter only after an initial and damaging period of drift. But that work has now righted the bank.
The minister can't be accused of rushing it. AIB is ready to be sold.
AIB doesn't need ongoing State support. The bank is very well capitalised, enough to insulate against all but the most devastating economic downturn.
A solid base of savers - providing 70pc of funding - and good access to the bond markets means it has ready access to funds if and when credit demand picks up in the Irish market.
Investors who think the economy here is set to do well can take that bet simply by buying AIB shares. But AIB's simplicity is also a weakness. Three-quarters of revenue is interest on loans, overwhelmingly in the Republic.
To build resilience AIB will have to diversify, either entering new markets abroad or new businesses at home. Until then the bank is a one-trick pony, even if right now it looks like a pretty good trick.