Bank of Ireland keeps deposits at lower cost
BANK of Ireland said yesterday it was attracting deposits, cutting costs and expected home loan arrears to peak this year, raising hopes Ireland’s biggest lender had turned a corner after a 60 per cent drop in operating profit in 2011.
The only Irish bank to avoid nationalisation after an unprecedented property crash, Bank of Ireland said low interest rates would make it harder to achieve its goal for a net interest margin – the gap between what it charges for loans and what it pays to borrow – of two per cent in 2014.
But chief executive Richie Boucher was optimistic of progress after the cost of drawing in deposits and an expensive government guarantee of its liabilities trimmed the margin by 13 per centage points to 1.3 per cent last year.
After successfully attracting private capital to meet strict new central bank targets last year, Bank of Ireland is focused on restructuring and weaning itself off state funds.