Bank of Ireland rises 44%: Cuts in British and American losses provide boost for shares

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The Independent Online
A GENEROUS 1992 dividend and pared losses in Britain and the United States last year boosted shares in Bank of Ireland by 11p to 243p yesterday.

Bank of Ireland announced a 44 per cent increase in pre-tax profits to Ir pounds 124m ( pounds 124.25m) for the year to 31 March. The second-half dividend was a higher-than-expected Ir6.5p, bringing it to Ir9.8p for the year after Ir9.2p last year.

But loan loss provisions increased to Ir pounds 150m from Ir pounds 147m the previous year, boosted by one large provision believed to be related to Guinness Peat Aviation, which was rescued by GE Capital yesterday.

Retail banking in Ireland produced a profit of Ir pounds 135m compared to Ir pounds 132m the previous year, with provisions static at Ir pounds 36m. In Britain, where the bank made a profit in its branch network, losses were Ir pounds 10m against Ir pounds 22m the previous year. Bad debt provisions were almost halved to Ir pounds 9m.

Bank of Ireland's US subsidiary, First NH Banks of New Hampshire, lost Ir pounds 45m compared with Ir pounds 77m. Maurice Keane, deputy chief executive, said: 'You could reasonably conclude that the bank in New Hampshire will be back in profit in 1993, but Britain may take a little longer.'

First NH's first-quarter results for 1993 were also released, showing a break-even performance. 'Britain and the US are still loss-making but at least they are clawing back the losses,' Alison Deuchars, analyst with Lehman Brothers, said.

Loan loss provisions doubled in the corporate and treasury division to Ir pounds 32m, due to corporate lending problems in Ireland and the US, but profits rose to Ir pounds 65m from Ir pounds 58m.

Lifetime Assurance Company, which once gave Bank of Ireland an edge over its rival, Allied Irish Banks, dropped its contribution by Ir pounds 18m because of accounting changes and other factors. Group costs rose by 10 per cent. A voluntary redundancy programme starts at the end of May, affecting hundreds of jobs.