Sunday 25 February 2018

BoI expected to announce losses of more than €1bn

BoI chief Richie Boucher
BoI chief Richie Boucher

Laura Noonan

BANK of Ireland is expected to reveal underlying losses of more than €1bn for the half year to June when it releases interim results tomorrow.

The figures come exactly a week after rival AIB announced it lost €2bn over the same period, marking the bank's worst results.

Forecasts from Merrion Stockbrokers suggest Bank of Ireland will report underlying losses of €1.5bn for the period, while Davy's are pencilling in €1.36bn and NCB have €1.1bn.

The other three Irish brokers following Bank of Ireland -- Bloxham's, Goodbody's and Dolmen -- were unable to provide figures yesterday.

The billion-plus underlying losses are attributed to massive loan writeoffs, with Merrion predicting €1.9bn, Davy predicting €1.84bn and NCB predicting €1.6bn.

"One-off gains on liability management and pension restructuring will largely offset underlying losses," Merrion's analyst Sebastian Orsi stressed in a note to clients.

Brokers expect the bank to book a gain of between €1.27bn and €1.4bn from pension changes and gains on its recent bond market activities.

On the trading front, the three analysts are pencilling in pre-provision profits of between €450m and €468m.

"Net revenue generation will have been constrained by elevated funding/guarantee costs and deposit spread in the period," NCB analyst Ciaran Callaghan wrote in a note to clients.

Bank of Ireland was the third most traded stock on the Irish exchange yesterday, with shares rising as much as 5pc (to 87c) before closing at 86c.

Irish Independent

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