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Bank of Ireland (ADR) (OTCMKTS:IREBY) Leveraged Strong Franchises In The UK and Ireland

Richie Boucher, the Group CEO of Bank of Ireland (ADR) (OTCMKTS:IREBY) expressed his views on the full year results ended on December 31, 2014. He said that company’s primary focus will remain on developing relationships with existing and new customers. In the year, management leveraged strong franchises in the UK and Ireland. The company increased its new lending by over 50% €10 billion and reported strong performances across all franchises. It was the largest lender to the Irish economy in FY2014.

Performance in the UK

Boucher further said that in the UK, Bank of Ireland almost doubled its new mortgage lending services. It was possible due to planned investments and improvement of distribution arrangements. Several steps were initiated to provide effective solutions to customers, along with due focus on asset quality. The measures taken have enabled the bank to minimize defaulted loans to 14.3 million. It is a substantial achievement as it is deductions of almost €4 billion from peak levels. The underlying profit before tax came at €921 million in FY2014. It represents an increase of €1.5 billion compared to FY2013.

The financial performance

Bank of Ireland (ADR) (OTCMKTS:IREBY) improved its net interest margin to 2.22% in 4Q2014. It is indicative of bank’s disciplined approach to pricing. The management is focused on achieving robust capital generation and managing the surfacing regulatory environment. Bank of Ireland increased its transitional core equity tier one ratio to 14.8%. The bank also passed the comprehensive test of ECB. The accelerated pace of capital expansion implies that the bank is on the right path to derecognize the preference shares of 2009 in next year.

The other measures

Bank of Ireland (ADR) (OTCMKTS:IREBY) maintained tight control of its cost base in FY2014. It also continued to invest in infrastructure and new businesses. The customer loan impairment charges declined €1.1 billion in FY2014. It indicates rising collateral values and improving economic environment.

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