ACCBank reports big rise in pre-tax profits to €67.3m

ACCBank, a wholly owned subsidiary of Dutch-owned Rabobank, has announced pre-tax profits of €67.3 million for last year against €32.4m in 2005.

Its operating income during 2006 came to €152.8m against €166m a year earlier.

Costs rose by 5% during the year and the cost income ratio came in at 62.7%, high by Irish banking standards.

Since it was taken over by Rabo in 2002 the group has changed its focus to concentrate on the provision of banking services to the small and medium-sized business sector. It has also started to develop a dedicated wealth management team geared at high net worth individuals that will be developed over time.

Overall, the group said in a statement yesterday, the strategy was “proving successful in terms of repositioning the bank”.

By the end of 2006, commercial loans and advances were more than 50% of total lending to customers and stood at €6.5 billion.

As part of the strategy, ACC is repositioning a number of its traditional branches as business centres, a move which will best meet the needs of business customers.

Fergus Murphy, the newly appointed chief executive, said the bank was pleased with the progress to date.

“Looking forward, the bank is now in a position to grow its SME business even further and we will be putting an increased emphasis on branding and marketing activities in the months and years ahead,” he said.

ACC was also hoping to build on the success of RaboDirect in Ireland, which he said offered ACC “a real opportunity to consider leveraging it further in Ireland”.

In 2001, the year Rabo offered to buy the bank from the State for €165m, the bank had made a loss of €21.8m for 2000.

The loss was mainly due to once-off items, including the settlement of a €21m DIRT bill. There were also restructuring costs of €16.3m associated with a reduction in staff numbers.

The then Finance Minister Charlie McCreevy said it was time to sell the bank.