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04/11/2009
Bank of Ireland Losses Top €1bn
The Bank of Ireland's profits have been severely hit by the recession and poor management.
It announced today that it had suffered almost €1billion in losses across six months this year.
In its Interim Statement, the lender made a pre-tax loss of €979million for the half year to the end of September, compared with a profit of €647million over the same period last year.
Chief Executive Richie Boucher said trading conditions in the first six months had been difficult.
"The level of economic activity across our main markets has contracted and the credit environment deteriorated. Economic conditions in Ireland were particularly challenging with 2009 consensus forecasts for GDP growth and unemployment dis-improving [sic] in the earlier part of the reporting period," he said.
However, Mr Boucher added that there were some indications of a "slow-down" in the pace of economic decline in the UK and "to some extent" in Ireland.
In his overview of the report, Mr Bruton added that the flow of funds across international money markets had improved from the more "stressed levels" experienced earlier in the year, but said that notwithstanding these trends, "the outlook remains challenging".
Bank of Ireland is expected to pass on €16billion of loans to the National Assets Management Agency (NAMA) at a discount when it comes into operation next year.
He said potential benefits of the NAMA scheme included increased certainty on banks' asset quality and impairment charges on property and construction loans, a reduction in the level of banks' Risk Weighted Assets, and improvement in banks' liquidity and funding positions, all of which would "facilitate the ability of banks to support the economy".
Mr Boucher closed saying stabilisation of the Bank has been the immediate management objective in the first half of this financial year.
"With the support of the Irish Government, our customers, our investors and staff we have made significant progress across all of our stated priorities."
(DW/BMcC)
It announced today that it had suffered almost €1billion in losses across six months this year.
In its Interim Statement, the lender made a pre-tax loss of €979million for the half year to the end of September, compared with a profit of €647million over the same period last year.
Chief Executive Richie Boucher said trading conditions in the first six months had been difficult.
"The level of economic activity across our main markets has contracted and the credit environment deteriorated. Economic conditions in Ireland were particularly challenging with 2009 consensus forecasts for GDP growth and unemployment dis-improving [sic] in the earlier part of the reporting period," he said.
However, Mr Boucher added that there were some indications of a "slow-down" in the pace of economic decline in the UK and "to some extent" in Ireland.
In his overview of the report, Mr Bruton added that the flow of funds across international money markets had improved from the more "stressed levels" experienced earlier in the year, but said that notwithstanding these trends, "the outlook remains challenging".
Bank of Ireland is expected to pass on €16billion of loans to the National Assets Management Agency (NAMA) at a discount when it comes into operation next year.
He said potential benefits of the NAMA scheme included increased certainty on banks' asset quality and impairment charges on property and construction loans, a reduction in the level of banks' Risk Weighted Assets, and improvement in banks' liquidity and funding positions, all of which would "facilitate the ability of banks to support the economy".
Mr Boucher closed saying stabilisation of the Bank has been the immediate management objective in the first half of this financial year.
"With the support of the Irish Government, our customers, our investors and staff we have made significant progress across all of our stated priorities."
(DW/BMcC)
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