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BOI says taxpayer is winner... despite massive €2bn loss

BANK of Ireland has reported a massive €2.1bn loss – but its chief says taxpayers are "very much in the money".

The bank says the increase in losses – up from €190m in 2011 – was due to the impairment charges.

Irish taxpayers own 15pc of Bank of Ireland and CEO Richie Boucher said that it has prioritised repaying its debt.

"The State's total investment has been €4.8bn and it has received back €3.8bn. The taxpayers are very much in the money with regards Bank of Ireland," he said.

"The job of myself and my colleagues is to make sure that all of our investors get a return on their investments. That €3.8bn is a very significant amount of money."

Over the past four years a total of 5,000 staff have left the bank – with 700 through parts of the group being sold. Redundancy programmes will continue this year, the bank said.

Default arrears on mortgages and loans has continued to increase but slowed considerably since the beginning of 2012.

It said that owner-occupier default arrears were 9.88pc at the end of 2012, compared with 7.4pc at the end of 2011.

The bank said the level of owner-occupied default arrears for the group remains just below the industry average from the Central Bank.

The volume of default arrears in the owner-occupied segment of the market has continued to increase, mainly due to the continued impact of the economic downturn and high unemployment levels.

Bank of Ireland said although it was another challenging year, the actions it has taken have begun to have a positive financial impact in the second half of 2012 which gives it "good momentum'' coming into 2013.

"While the economic environment has improved somewhat in recent months, it still remains difficult and the group continues to face many challenges,'' said Mr Boucher.

"However, we are starting to see some of the benefits flowing from the focus we have had over the past four years on our strategic objectives aimed at enhancing our core franchises and rebuilding profitability within a restructured, robust balance sheet,'' he added.

clairemurphy@herald.ie


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