Ulster Bank ‘making good progress on restructuring’

Ulster Bank has said it is continuing to make good progress in restructuring its core business, after seeing first-quarter declines in operating and impairment losses, a levelling out in mortgage arrears cases and a rise in customer deposits.

Yesterday’s quarterly figures show Ulster made an operating loss of £164m (€193m) during the first three months of this year.

This figure was down from the £243m losses in the final quarter of 2012 and marked a 47% year-on-year fall from the £310m losses in the first quarter of last year.

Furthermore, impairment losses fell year-on-year from £394m to £240m.

The bank’s chief executive, Jim Brown, said management remains focused on the recovery of the business and it is on the right path.

“As the economic environment stabilises, Ulster Bank continues to make good progress on the restructuring of its core bank, with a significant decrease in operating and impairment losses, an increase in customer deposits, an improvement in the loan-to-deposit ratio, and a stable net interest margin,” he said.

While Mr Brown said that mortgage arrears levels amongst Ulster’s customer base have “plateaued” over the past quarter, only things like commitments to legislate on the 2011 Justice Dunne/High Court ruling on lenders’ rights regarding property repossessions and the amending of the Code of Conduct on Mortgage Arrears will help improve the arrears issue significantly.

On a group-wide basis, meanwhile, Royal Bank of Scotland, Ulster’s owner, reported a first-quarter operating profit of £829m, up from £553m in the last three months of 2012.

The group said it could, by the middle of next year, be in a position to allow the UK government begin selling its 81% stake in the group.

Regarding Ulster, RBS said “credit trends in Ireland are turning a corner”.

And yesterday, Reuters reported that Britain has no imminent plans to start selling shares in state-backed lenders Royal Bank of Scotland and Lloyds Banking Group