KBC Bank Ireland has reported profits of €16.2m after tax and impairment costs for the first quarter of this year. This compares to a loss of €17.1m the same time last year.
The bank, which has €14.4 billion of loans and mortgages outstanding in Ireland, said its loan impairment costs fell to €7.4m from €47.9m in the previous quarter.
It said it was continuing to see progress in resolving arrears in its retail mortgage and SME loan books and reported a 23% decrease in the number of mortgage arrears cases since December 2013.
The bank said its mortgage business continued to grow and it now has a 12% market share at the end of the first quarter.
Its total retail deposits stood at €3.6 billion and it added 15,000 customer accounts in the three month period.
During the first quarter, KBC Bank Ireland opened new banking hubs in Naas, Kilkenny and Waterford and also bought hub locations in College Green in Dublin and in Wilton in Cork. It has an Irish workforce of over 1,000.
The bank's Irish CEO Wim Verbraeken said that it was pleased with its progress so far this year after previously indicating that it was on track to return to profit by 2016.
"However, we are still in expansion mode and this growth requires continued investment in new retail banking hubs and digital platforms to ensure we offer superior service and innovation for customers," he added.
Overall, the Belgian financial group KBC today reported a better than expected net profit in the first quarter due to a strong improvement in the company's insurance business and a return to profit for its unit grouping smaller markets such as Ireland.
Net profit, adjusted for one-off items, rose by 51% in the first quarter from the same time last year to €510m, well above the €384m expected in a Reuters poll of six analysts.
The group said its combined ratio - costs plus claims as a percentage of revenues, a key profit indicator in the non-life sector - fell to 82% in the first quarter due to a mild winter across all regions, meaning fewer claims.
KBC's International Markets business, which consists of units in Bulgaria, Hungary, Ireland and Slovakia, swung to a net profit of €24m from a €28m loss in the same time last year.
The group recorded a sharp decrease in impairment losses in the first quarter, mainly because of declines in Ireland and the Czech Republic.
KBC kept its guidance for Irish loans losses of between €50-100m in 2015 and 2016.