BoI losses near €1bn

Bank of Ireland has suffered almost €1bn losses in six months this year, it revealed today.

The lender made a pre-tax loss of €979m for the half year to the end of September, compared with a profit of €647m last year.

Across the group more than €1.8bn of loans are impaired.

Chief executive Richie Boucher gave a gloomy review with only a small suggestion that the Irish economy was turning a corner.

“The level of economic activity across our main markets has contracted and the credit environment deteriorated,” he said.

“Economic conditions in Ireland were particularly challenging.”

Mr Boucher added: “There are some indications of a slowdown in the pace of economic decline in the UK and to some extent in Ireland.”

Bank of Ireland was expected to pass on €16bn euro worth of loans to the National Assets Management Agency (Nama), at a discount.

In its six-monthly review, the bank said a discount of 30% was being explored but this figure could be reduced based on industry valuations.

Mr Boucher added: “Our impairment charge in the six months to 30 September 2009 of €1.8bn reflects significant deterioration in asset quality in our property and construction portfolio, primarily landbank and development in Ireland.”

The bank repeated forecasts for loan losses to top €6.9bn in the three years to March 2011.