Irish Life and Permanent says it expects operating profits for the year to be significantly better than 2009, despite the tough conditions evident in Ireland.
In a trading update, it says that early arrears cases (under 90 days) in its residential loan book have levelled off since May. But arrears cases over 90 days in its Irish residential and commercial mortgage books continue to rise.
It added that current estimates for full-year impairment provisions for the bank are about 10-15% below the 2009 level.
In its banking division, Irish Life & Permanent said the good progress made in the first half of the year in refinancing long-term debt has been affected by the deterioration in debt markets since May.
It said that of the total term debt refinancing requirement of €6.4 billion for the year, €4.8 billion has been refinanced under the ELG and €0.5 billion by way of a sale of Irish mortgage assets. It says its current focus is to raise un-guaranteed term funding using its UK residential mortgage assets as security.
In its life and pensions business, IL&P says that total life and investment sales for the year are expected to be ahead of 2009. It said that while the retail and corporate divisions of Irish Life Assurances are both seeing weaker demand, it continues to record strong institutional inflows.
The weaker life sales have resulted in a near 25% fall in recurring premiums sales, due to reduced household disposable incomes and SME cash flows. It added that the fall in corporate premiums sales are due to the impact of salary reductions and lower numbers employed in corporate pension schemes.
IL&P says that final offers have to be made before the end of the year for the EBS Building Society. It is among the final two bidders for the society.
Irish Life and Permanent shares were up 3.8% to 85 cent in Dublin this afternoon.
