No loan sales on road to redemption
Bank of Ireland has spent the past decade climbing out of the hole it dug during the boom. Like chief rival AIB, the road to redemption for BoI has been long and arduous.
BoI escaped the bail-out conditions of its peer, but its return to growth and profitability has been more muted. While non-performing exposures now sit at 8.3pc of customer loans, down from 11.4pc in December 2016 - far lower than AIB's 18pc - the bank said its 'cure' rate is expected to reduce next year.
The progress on this front beat market expectations and helped produce a €44m write-back at the end of last year.
CFO Andrew Keating said this was testament to the bank's "structuring" or "forebearance" solutions. Cumulatively, over the past few years, BoI has reversed some €650m of impairments on its Irish mortgage book - but that will slow in future partly due to a new accounting structure which alters the calculus on loan loss provisioning.
The bank is determined to eschew loan portfolio sales, a strategy that will play well politically but may delay a return to a higher dividend payout.