AIB SEES 25% DROP IN MORTGAGE APPLICATIONS - AIB Group this morning reported profits before tax of €1.3 billion for the six months to the end of June, an increase of 8% on the same period last year.
The bank's income in the period was €2.4 billion, which represents an increase of around €350m, while adjusted earnings per share were up 16% at just under 109 cent.
Chief executive Eugene Sheehy said the bank had had a strong first half, with Republic of Ireland banking profits up 17% and UK profits rising 19%. He said 52% of AIB profits now came from outside Ireland.
In Ireland, deposits have been flat since December. Mr Sheehy blamed this on the ending of the SSIA scheme, as 30% of this money was withdrawn for spending.
Asked about the slowdown in the mortgage market, he said applications for mortgages at the bank were down 25% in the first half. He said the housing market would return to a sustainable level of 50,000-60,000 house completions a year.
On a drop in profits at its US bank M&T, Mr Sheehy said the bank had come back on track in the second quarter after a mortgage-related charge in Q1.
He said AIB expected economic growth of 3.3% next year, but this was well ahead of the euro zone average and he did not see unemployment becoming a problem.
