NIB reports €600m pre-tax losses

NATIONAL Irish Bank has reported a pre-tax loss of €600 million for the first nine months of this year, up by over €130m on the same period in 2010.

In August, the bank reported first-half pre-tax losses of €400m. The Danish-owned bank’s performance this year — though in line with expectations — has been severely hampered by a marked reduction in consumer demand and the impact of impaired loans.

Yesterday’s nine-month figures showed an impairment charge of €632m — the amount of money set aside to cover non-performing loans — which compares to 504m for the first nine months of 2010.

“Impairments remain very high, mostly due to the continued weakness of the property market in Ireland,” chief executive Andrew Healy said yesterday.

Mr Healy also pointed out, however, that while the impairment picture looks grim on a year-on-year level, the charge is improving on a quarter-by-quarter basis.

“They are slightly down on the previous quarter and we hope to see a downward trajectory moving forward. Deposit and cost performance is encouraging, with the benefits of our restructuring programme, particularly, being seen on the cost line,” he said.

In August, Mr Healy said the bank’s restructuring programme was delivering cost-savings benefits, but that impairments were still “frustratingly high”.

While the bank’s loan book fell by 8%, to €9bn, year-on-year over the nine months, its operating costs were down by 19% to €71m and customer deposits rose by 18% to €5bn.

The bank’s latest figures also show an 11% year-on- year fall in operating profit, for the nine months to the end of September, to €32m, and a 17% fall in income to €103m.

On a group-wide basis, National Irish Bank’s parent — Danske Bank — said its pre-tax profits for the nine months were down by 28%, year-on-year, to €482m; with operating profit down by 24% to €1.61bn.

The Danish group also set €1.13bn aside to deal with impaired and non-performing loans. The group said it remains strongly committed to Ireland through the National Irish Bank brand.

“We believe the changes we have made to our business create a good platform for growth once market conditions improve,” it said.