The outgoing Governor of the Bank of Ireland, Richard Burrows, has told shareholders at the bank's AGM in Dublin today that the last trading year had been one of 'unprecedented dislocation'.
Mr Burrows told the shareholders that he knew the decision to cancel the payment of dividends had caused 'difficulty and distress'. He said accountability for this distress must be 'taken at the top' and so he had decided to retire as Governor of the Bank of Ireland.
Pat Molloy was appointed as Governor of the bank at the end of today's meeting.
Mr Burrows said Bank of Ireland was facing into a difficult period ahead and expected lower levels of business activity.
Earlier, Bank of Ireland says that the economic environment in its main markets remains difficult and trading conditions are challenging.
In a trading statement, the bank says that demand for new lending remains muted due to the lower interest rate environment and increased competition.
The bank said it saw no change to its expected impairment charges of about €6 billion in the three years to March 2011. This includes the loan impairment charge of €1.4 billion taken in the year to March 2009.
However, it said that the loan impairment charge could move higher in the event of a further deterioration in economic conditions or further prolonged low levels of activity in the property markets.
Bank of Ireland said that the amount of customer deposits it had by the end of June is marginally lower than at the end of March, while the amount of customer lending remains broadly unchanged.
It said that it has raised about €3 billion in term funding, while it also said it has strengthened its capital position after the successful completion of a debt buy-back programme of euro, sterling and US dollar securities. This raised the bank about €1 billion.
On NAMA, Bank of Ireland said that as details of how it will operate are not yet finalised, the impact on its operating profit and loan impairment charge remains 'uncertain'. However, it added that it continues to 'engage positively' with the National Asset Management Agency.
The bank's chief executive, Richie Boucher, told the AGM that the bank was open for business in the mortgage market.
Bank of Ireland CEO, Richie Boucher, said the bank was approving four of out five loan applications for small business, not mortgages as reported earlier.
He did say that the bank was open for mortgage business and that mortgage loan applications were up 60%.
Director of the Small Firms Association, Patricia Callan, said that the bank's figures only take in account the applications that get to the process stage.
She said that in real terms, many businesses are meeting with their banks informally, and are told at that stage that there is no hope of getting the money so an application is never actually made.
She said that until the banks start to track that enquiry level, there won't be a true estimate of the real levels of lending.
The incoming chairman of the bank, Pat Molloy, said he has confidence in the bank and its future.
Mr Molloy said he also had confidence in the leadership of the bank. The new chairman said Bank of Ireland faced a difficult and demanding journey, but was confident the bank would succeed.
Bank of Ireland shares closed up a cent to €1.54 in Dublin this evening.
