Anglo Irish Bank Corporation PLC - Preliminary Results for the Year Ended 30 September 2008

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HIGHLIGHTS Anglo Irish Bank (Wednesday 3 December 2008) released its preliminary statement for the year to 30 September 2008. Key highlights include:

Highlights

Anglo Irish Bank (Wednesday 3 December 2008) released its preliminary statement for the year to 30 September 2008. Key highlights include:

Profitability

  •     Reported profit before taxation of €784 million, with earnings per share of 88.4c
  •     Prudent general collective provision of €500 million charged, 0.71% of average loan balances
  •     Core pre-tax profits, before impairments and fair value movements, of €1,771 million, up from €1,376 million in 2007
  •     Stable net interest margins notwithstanding increased funding costs
  •     Active cost management, with overheads reduced by €65 million, and cost to income ratio improving by 5 percentage points, from 22% to 17%

Balance sheet

  •     Lending increased by €9.3 billion on a constant currency basis, to €73.2 billion, with growth moderating to 5% in the second half of the year
  •     Impaired loans represent 1.3% of closing loan balances
  •     Customer funding of €51.5 billion, representing 58% of total funding
  •     Strong capital position with regulatory core equity ratio, adding back collective provisions, of 6.7%
  •     Tier 1 and Total Capital ratios of 8.4% and 12.0% respectively

Commenting on the results, David Drumm, Group Chief Executive, said:

"The Bank continued to perform strongly in 2008 notwithstanding the difficult general market environment.

Core business profitability, before impairments and fair value movements, increased to €1.8 billion, reflecting the annuity nature of the Bank's interest income and an efficient and flexible cost base which adapted quickly to changing market conditions. The balance sheet was further strengthened through capital retentions and by choosing to increase collective provisions by €500 million.

We are well positioned for the recessionary economic environment ahead. We will continue to generate robust core profits annually over the next three years, which will provide the capacity to absorb anticipated increased lending impairments, whilst also improving capital ratios. Strengthening our capital base is a key priority and, accordingly, the Board does not propose a final dividend in the current year.

The Bank is focused and prepared for the challenges facing the banking sector. We will continue to diligently manage asset quality, enhance our funding franchises and further strengthen our capital position."

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David Drumm
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