Bank of Ireland has posted pre-tax profits of €1.32 billion for the year ending March 31, 2005 - an increase of 13% on the same time last year.
Earnings per share rose by 7% to 114.2 cent - in line with forecasts - and the bank said a strong economic performance in its main Irish and UK markets gave it optimism for the coming year.
The bank's directors have recommended a final dividend of 29 cent. This, together with the interim dividend of 16.6 cent, results in a total dividend of 45.6 cent for the year to the end of March, up 10% on the previous year.
The group recently announced a transformation programme that will include 2,100 job cuts in an effort to cut costs at the bank. This programme amounted to €210m, in addition to capital expenditure of €40m. The bank said a provision of €117m has been provided for.
Bank of Ireland said its pre-tax profits at its Republic of Ireland operations increased by €71m, or 17%, to €490m in what the bank called an 'excellent performance, reflecting very strong income growth, good cost control and very satisfactory asset quality'.
Irish lending volumes grew by 24% with the mortgage market remaining buoyant throughout the year with the bank's year end mortgage balances up 27%. Lending to the business sector rose by 23%. Costs rose by 7%. The bank said that higher salary, depreciation and information technology costs were partly offset by savings in other areas.
Bank of Ireland Life, the Group's life and pensions business, saw operating profits grow by 17% due to good sales growth. Market share increased by 3% to 24% based on industry new business returns.
Pre-tax profits in the bank's Wholesale Financial Services rose by 10% to €407m. The bank said the division has benefited from significant growth in lending volumes and fee based income, with another 'very strong' performance by First Rate Enterprise's Joint Venture with the UK Post Office.
Corporate Banking during the year was buoyed by strong lending growth and fee income. BoI said that trading conditions for Global Markets had been challenging and the business reported a good performance. Davy has 'enjoyed an excellent year,' the company said.
The Bank of Ireland's UK Financial Services reported a pre-tax profit of £265m sterling for the year to March 2005, up 2% on the previous year. The loan book growth was up 12% to £25 billion, while total income was 2% lower as a result of tighter margins.
The sale of the financial advice business, Chase de Vere, was concluded in March and the bank said that having concluded that the non-mortgage elements of Bristol and West were not strategically core, it has received a number of expressions of interest for this business.
The Asset Management Services Division, which incorporates the Group's asset management and securities services businesses, saw pre-tax profits fall by 8% to €115m over the same time last year.
The bank said that assets under management in BIAM fell to €46.9 billion compared to the prior year level of €57.5 billion, a decrease of €10.6 billion, as the division experienced challenges and the departure of several key investment managers.
Assets under management in Iridian increased by 5% to $10.3 billion, the bank added.
'Bank of Ireland performed strongly in the year to March 2005, based on the inherent strengths of our business and our significant exposure to Europe's two best performing economies,' commented Group CEO Brian Goggin.
'We have a clear plan to implement our strategy by improving efficiency, investing in a more flexible business model and improving business performance by exploiting our opportunities for growth,' he added.
Bank of Ireland shares were down two cent to €12.20 in Dublin this evening.
