DUBLIN, Aug 3 (Reuters) – Bank of Ireland’s first half profit rebounded to 2019 levels as it firmly supported the COVID-19 disruption with higher revenues, further cost cuts and barely falling new bad loans.
Ireland’s largest bank in terms of assets said on Tuesday it recorded a profit of 465 million euros in the first six months of 2021. That compared to a loss of 669 million euros before tax during from the same period a year ago, although the loss for the year 2020 was ultimately about half that amount as loans and income recovered in the second half of the year.
While its main Irish market was in its third and longest foreclosure for much of the first six months of this year, the bank has only set aside â¬ 1million to cover possible defaults, against 937 million euros in the first half of 2020.
On a pre-depreciation basis, underlying operating profit was 7% above 2019 levels, before the pandemic.
“Our results today and our outlook for the future are radically different from 12 months ago,” Chief Executive Officer Francesca McDonagh said in a statement.
Reflecting the “increasingly positive” outlook, total second-half income is expected to be 5% higher than the first, the bank said, with annual costs expected to fall below â¬ 1.65 billion this year , against 1.72 billion in 2020 and 1.5 billion. by 2023.
With the Irish government planning to sell part of its 13.9% stake in the bank by the end of the year, CFO Myles O’Grady told Reuters it was also possible to resume some provisions on bad debts linked to the pandemic.
Analysts at Davy Stockbrokers, which Bank of Ireland is expected to acquire in 2022, said it would likely improve its annual forecast for the bank significantly due to better-than-expected results and improving outlook. (Reporting by Padraic Halpin; Editing by Kirsten Donovan)