TIDMBIRG
RNS Number : 8882F
Bank of Ireland Group PLC
26 February 2018
Bank of Ireland Group plc (the "Group")
Publishes Annual Results for the 12 months to 31st Dec 2017
26 Feb 2018
2017 Key Highlights:
-- Underlying profit of EUR1,078m
-- Continued organic capital generation; fully loaded CET1 ratio
of 13.8%; regulatory CET1 ratio of 15.8%
-- Re-commencing dividends in respect of the 2017 financial
year; dividend of 11.5 cents per share (EUR124m) has been
proposed
-- 11% growth in New Lending to EUR14.1bn
-- Largest lender to Irish economy; Growing market share in
residential mortgages and largest market share in business
banking
-- New Irish mortgages; growth of 41% and market share increased
to 27%; Strong commercial pricing discipline maintained
-- Further significant improvement in asset quality; NPE ratio
now at 8.3%. NPEs reduced by 31% to EUR6.5bn; Impaired loans
reduced by 35%
-- NIM of 2.29% for the period; an increase of 9bps from 2016
-- Transforming our culture, technology and business models
-- Committed to successful implementation of investments to replace Core Banking Platforms
-- Reversals reduced the impairment charge to EUR15m (2bps)
-- IFRS 9 transition adjustments reduce the fully loaded capital
ratios by c.20bps on 1 Jan 2018
-- Tracker charge of EUR170m classified as non-core
-- Expect net loan book growth in 2018
-- Expect NIM to be modestly lower than 2017, broadly in line with 2017 exit NIM of 2.24%
-- Expect operating expenses will reduce in 2018 as an important
step on our ambition to reduce our cost income ratio to below 50%
over the medium term
-- Expect the impairment charge for 2018 to be up to c.20 bps,
reflecting the transition to IFRS 9 and a slower pace of impairment
reversals
-- Investor Day in June 2018 to expand further on strategic
priorities and growth ambitions for the Group
CEO Comment: Francesca McDonagh, Bank of Ireland, Group CEO,
commented:
'In my first set of financial results as Group CEO, I am
delighted to report that the Group had a strong performance in
2017. All trading divisions are profitable and have contributed to
an underlying profit of EUR1,078 million for the year. In Ireland,
we have grown our market share in residential mortgages and we have
the largest market share in the business banking sector. We
materially improved our asset quality, reducing our level of
non-performing exposures by a further 31%. Our fully loaded CET 1
ratio has increased to 13.8% and we are re-commencing dividend
payments to our shareholders for the first time in ten years'
Ireland - Leading bank in a growing economy:
-- Ireland's leading retail and commercial bank, continuing to
support and benefit from economic growth in Ireland
-- #1 or #2 market positions across all principal product lines
-- Customer focussed strategy is to deliver a brilliant
experience to all of our customers as we transform our businesses
by providing products and services which meet their financial
requirements through easy, simple and accessible processes which
align to their digital expectations
-- Irish mortgage business performed strongly over the period
with c.EUR2 billion of new residential mortgage lending in Ireland,
an increase of 41% from 2016 with an increase in market share to
27% in 2017 compared to 25% in 2016; expect to re-enter the Irish
mortgage broker market later in 2018, which will further support
growth in our mortgage business.
-- Largest market share in business lending; provided over 50%
of new lending to the agricultural sector in Ireland
-- Ireland's #1 corporate bank with new lending volumes of
EUR3.6 billion during 2017, up 13% on 2016
-- Significant support for housing development in Ireland and
supporting 2 out every 3 FDI projects into Ireland
-- Only bancassurer in the Irish market and our Bank of Ireland
Life division saw sales volumes increase year on year by 10%, with
a new business market share of 19%
Attractive UK and International franchises provide
diversification and further opportunities for growth
-- Long standing partnerships with Post Office and strategic
intermediaries; recent partnership with AA continues to develop
-- Continue to develop our broadly based customer financial
services offering, providing a wide range of retail products
including savings, mortgages, loans, credit cards and ATM
facilities
-- Continue to be #1 player in UK consumer foreign exchange
-- Post Office / AA top 2 most trusted brands in the UK
-- Northern Ireland business is a full service retail and
commercial bank and is performing in line with our business
objectives
-- Northridge Finance performing well; acquired complementary
car leasing and fleet management business, Marshall Leasing
-- International Acquisition Finance delivered another strong performance during the year
Key Financial Highlights:
Group Income Statement
-- Underlying profit of EUR1,078m
-- NIM increased to 2.29% in 2017 primarily reflecting strong
commercial discipline on pricing and further reductions in our cost
of funding; NIM in 2018 is expected to be broadly in line with the
exit NIM of 2.24%
-- Other income of EUR801m includes sustainable business income
of EUR662 million which increased by c.8% from 2016
-- Operating expenses of EUR1,789m including FX benefit of c.EUR24m
-- Core Banking Platforms investment in 2017 of EUR195m (CET1
ratio impact of c.40bps); EUR111m expensed to income statement
-- Customer loan impairment charge of 2bps; Impairment charges
(net) of EUR15m benefiting from reversals, particularly on the
Irish mortgage book
-- Non-core items include charge of EUR170m for Tracker Mortgage Examination
Balance Sheet and Capital
-- Customer loans of EUR76.1bn reflecting new lending of
EUR14.1bn, customer redemptions of EUR13.8bn, redemptions of
impaired loans and GB non-core business banking loan book of
EUR1.2bn and an FX translation impact of EUR1.5bn
-- Customer deposits of EUR75.9bn account for 100% of Group
funding, predominantly retail sourced
-- Non-performing exposures (NPEs) of EUR6.5bn / 8.3% of
customer loans: reflects a EUR2.9bn / 31% reduction during 2017
-- Impaired loans of EUR4.0bn / 5.2% of customer loans: reflects
a EUR2.2bn / 35% reduction during 2017; down 73% from reported peak
in June 2013
-- Strong liquidity ratios: Net Stable Funding Ratio - 127%,
Liquidity Coverage Ratio - 136%, Loan to Deposit Ratio - 100%
-- "Holdco" structure established in July 2017; Future senior
and junior debt issuance for MREL purposes expected to be issued
from "Holdco"; modest new MREL issuance expected
-- Strong organic capital generation of 140bps in 2017; Robust capital ratios
-- Regulatory CET1 ratio of 15.8%
-- Fully loaded CET1 ratio of 13.8%
-- Regulatory Total Capital ratio of 20.2%
-- Volatility in pension scheme deficit has materially reduced
reflecting impact of interest rate and inflation hedging
-- The Group expects to maintain a CET1 ratio in excess of 13%
on a regulatory basis and on a fully loaded basis by the end of the
O-SII phase-in period. This includes meeting applicable regulatory
capital requirements plus an appropriate management buffer
-- As anticipated, the Group is re-commencing dividends in
respect of the 2017 financial year; a dividend of 11.5 cents per
share (EUR124m) has been proposed
-- Expect that dividends will increase on a prudent and
progressive basis and, over time, will build towards a payout ratio
of around 50% of sustainable earnings
Ends
http://www.rns-pdf.londonstockexchange.com/rns/8882F_-2018-2-26.pdf
For further information log on to www.bankofireland.com/investor
or contact:
Bank of Ireland
Andrew Keating Group Chief Financial Officer +353 (0)766 23
5141
Alan Hartley Director of Group Investor Relations +353 (0)766 23
4850
Pat Farrell Head of Group Communications +353 (0)766 23 4770
Forward-Looking Statement
This document contains forward-looking statements with respect
to certain of the Bank of Ireland Group plc (the 'Company' or 'BOIG
plc') and its subsidiaries' (collectively the 'Group' or 'BOIG plc
Group') plans and its current goals and expectations relating to
its future financial condition and performance, the markets in
which it operates and its future capital requirements. These
forward-looking statements often can be identified by the fact that
they do not relate only to historical or current facts. Generally,
but not always, words such as 'may, ' 'could,' 'should,' 'will,'
'expect,' 'intend,' 'estimate,' 'anticipate,' 'assume,' 'believe,'
'plan,' 'seek,' 'continue,' 'target,' 'goal,' 'would,' or their
negative variations or similar expressions identify forward-looking
statements, but their absence does not mean that a statement is not
forward-looking.
Examples of forward-looking statements include among others,
statements regarding the Group's near term and longer term future
capital requirements and ratios, loan to deposit ratios, expected
impairment charges, the level of the Group's assets, the Group's
financial position, future income, business strategy, projected
costs, margins, estimates of capital expenditures, discussions with
Irish, United Kingdom, European and other regulators and plans and
objectives for future operations. Such forward-looking statements
are inherently subject to risks and uncertainties, and hence actual
results may differ materially from those expressed or implied by
such forward-looking statements.
Nothing in this document should be considered to be a forecast
of future profitability, dividends or financial position and none
of the information in this document is or is intended to be a
profit forecast, profit estimate or dividend forecast. Any
forward-looking statement speaks only as at the date it is made.
The Group does not undertake to release publicly any revision to
these forward-looking statements to reflect events, circumstances
or unanticipated events occurring after the date hereof.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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