AIB has reported an operating loss of €2.8bn for 2012, down from €8.1bn on the previous year, marking a 65% decrease.
Customer accounts at the bank grew last year by 5%, a boost of €2.9bn.
Chief Executive David Duffy said while 2012 was a difficult year, significant steps were taken on the road to recovery.
He added the bank's focus this year will be on assisting both small and medium businesses, and mortgage arrears.
He said: "AIB has now largely completed the restructuring phase of its strategic plan as the bank targets a return to sustainable profitability and growth during 2014. While 2012 was another very challenging year for the group, a number of important steps were taken to position the bank for recovery over the longer term.
"Assisting both SME and mortgage customers in difficulty will continue to be a major priority for this year. AIB intends to meet or exceed the recently announced Central Bank of Ireland 2013 sustainable mortgage solution targets as part of ongoing efforts to deal effectively and quickly with customers in difficulty."