ACCBank surge in lending sees profits increase 31% to €35.9m

ACCBank, the former State-owned farmers’ bank, generated profit before tax and extraordinary items of €35.9 million for the year to December 31, 2003.

That’s a significant increase of 31% on the previous year’s figures and reflects a surge in lending to the business and agri-business sectors.

Part of the giant Rabobank of Holland, the group is continuing to shift its focus to enhance its Irish presence.

Declining farm figures have forced the production of fresh strategies from this part of the banking sector. As a result the parent bank and, now ACC, is going through a period of transition.

Straight banking activity beyond agriculture into the servicing of straight business ventures as well as agri-business has been part of the group’s Irish strategy for some time. Business banking is set to become more prominent in the Irish banking subsidiary, a spokesman said yesterday.

In the year under review operating income was up 24% to €126.5m.

However, costs increased by almost 18% due to investment in a new IT system and related costs.

Net fee income rose from €16.8 million to €24.1 million, an rise of 43%. Fee income accounts for 19% of total income. Lending to customers grew from €2.7 billion to €4.4 billion during the year, showing an increase of 63%.

Gross assets at the bank increased by 67% to just over €6bn during the year under review.

Bank chief executive, Colm Darling expressed satisfaction with the year and the progress achieved in a competitive market. “ACCBank enjoyed strong profit and business growth during the year under review.

“This is as a direct result of the progress we have made in re-focusing the bank’s operations to concentrate on the business and agri-business sectors, as well as the investment market.

“With the strong support of our parent, Rabobank International, we are continuing to streamline our processes and are now focusing on providing a range of value-added products for our customers.”