IIB Bank said today that its profits after tax rose by 23% to €88.2m in 2004, up from €71.1m the previous year. Lending volumes increased by 28% during the year, while residential mortgage advances grew by 16% to €2.2 billion.

The bank said it expects continued strong growth in residential mortgage demand and pointed to increased levels of activity in the final quarter of 2004.

Its residential mortgages are distributed mainly through a network of independent financial intermediaries. The bank said it expects this channel to continue to expand in market share this year.

Activity levels in the bank's corporate, property and SME sectors were also strong with loan levels increasing by about 21%. The bank noted its growing activity in Public Private Partnership transactions.

IIB and its sister IFSC operation, KBC Finance Ireland, has funded two of the three public-private road projects. They have also funded a number of power projects on the island of Ireland and 11 renewable energy projects.

A strong performance in IIB's Treasury, Capital Markets and Wealth Management businesses was also reported for last year. Private clients invested some €100m in its capital secure investment products while it also arranged property investment syndicates totalling €250m.

Commenting on the results, CEO Ted Marah said that 2004 was a record year and represented a continuation of the bank's record of unbroken profit growth since its foundation in 1973.