IL&P set to meet 2005 targets

Irish Life & Permanent predicted in a six month trading statement today the group would meet its targets for the year.

"A strong economy and, in particular, a buoyant labour market provide a positive backdrop for both our banking and life businesses, supporting good demand and volume growth," said the statement.

"We are very satisfied with the progress made year to date and are on course to meet our targets for the full year."

The statement was issue ahead of its closed period for the six months to June 30.

"The environment in which the group is operating continues to be positive as the Irish economy is performing exceptionally well with rapid employment growth and strong domestic demand," it said.

"Bank new lending growth is robust with the margin outcome expected to be within the target range. In our life assurance business we are enjoying good growth in new business volumes with margins significantly ahead of the prior year."

Gross new lending for the group in the first half of the year is expected to show low double-digit growth with the total loan book growth exceeding 20% year on year.

The main driver of this growth is new residential mortgage lending in Ireland which continues to be buoyant with expected gross new lending of approximately €2.5bn for the first six months [2004: €2.2 billion].

As revealed earlier this week the bank confirmed about 34,000 new current accounts were added during the period since their introduction of no fees banking fees.

Life sales in Ireland (excluding investment sales by ILIM) are expected to show low -teens growth at the half year.

The Retail Life division sales are strongly ahead, with pensions and savings in particular are showing excellent growth. The Corporate Life division is expected to record modest sales growth.

Institutional inflows into ILIM, the group’s fund management business, are expected to be around €700m for the first six months.

The sale of City of Westminster Assurance (CWA), the group's UK closed book of life business, was completed on June 2 and a loss of €22m arose on the disposal.

Allianz (Ireland), which carries on non-life insurance and in which the group has a 30% interest, is performing well and the first half outcome is expected to within the range previously guided.