Saturday 19 October 2019

AIB proposes 42pc increase in dividends despite fall in profits

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Ellie Donnelly

Ellie Donnelly

AIB has reported profit before tax of €1.25bn in 2018, down from the €1.31bn in profit reported in 2017.

Net interest margin – a key barometer of a bank’s performance – fell to 2.47pc last year, from 2.5pc the prior year, according to annual results from the group.

However, the bank has proposed a 42pc increase in dividends to €461m.

As the State owns 71pc of the bank, it is set to receive €327m of the dividends.

"Across all the key metrics, by which we judge ourselves, the business has performed well during the year," Bernard Byrne, outgoing CEO of AIB, said.

"The quality of the balance sheet continues to improve as we work through our legacy non-performing exposures."

The group reported net loan book growth of €0.9bn to €60.9bn.

New lending was up 15pc on previous year to €12.1bn, while its new mortgage lending was up 16pc to €2.8bn.

Non-performing loans at the bank have reduced by €4.1bn to €6.1bn at 31 December 2018 - which is 9.6pc of gross loans - from €10.2bn at December 2017.

AIB said its small and medium business in Ireland is "trading solidly" despite a weaker market backdrop.

Its SME lending in the UK is up 9pc off a low base; and the loan book remained static.

Separately and further to the announcement on 27 February, AIB said that Donal Galvin, the deputy chief financial officer (CFO) and group rreasurer, has been appointed CFO with immediate effect.

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