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IRISH BANK AIB has announced that it intends to distribute €1.7 billion to shareholders after reporting a post-tax profit of over €2 billion.
As interest rates rose, AIB’s net interest income rose from just over €2 billion in 2022 to €3.8 billion last year – a jump of 83% – due to the “changed interest rate environment and higher average customer loan volumes”.
The bank recorded a customer base of 3.3 million in 2023, compared to 2.8 million in 2020. During that time, as Ulster Bank pulled out of the Irish market, AIB acquired €6.8 billion worth of Ulster Bank’s loan books, with another €1 billion due this year.
AIB has today published its annual financial results for 2023, describing it as a “landmark year”.
CEO Colin Hunt called the 2023 results an “exceptionally strong financial performance”.
“During 2023, the Group returned to majority private ownership and we are keen to return further capital to the State with proposed distributions of c. €1.3 billion, including a €1 billion directed share buyback for which discussions are underway,” he said.
The bank said its operating costs increased 10% to €1.8 billion.
It attributed the increase in costs to “the impacts of wage and general inflation, an allowance for limited variable remuneration payable in 2024 (following the relaxation of some pay constraints) and increased cost to service an enlarged Group and customer base”.
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As we citizens & taxpayers bailed them out after the crash of 2008 it would be nice to think we would get some kind of reward ……..
No harm in dreaming…..
@Gerry Kelly: Eh, “we are keen to return further capital to the State with proposed distributions of c. €1.3 billion, including a €1 billion directed share buyback for which discussions are underway,” he said.”
@downburst1: yeah, that goes to the state. What about the billions in extra taxes we’ve all been paying since? Taxpayer won’t see a sniff of it despite us bearing the brunt of the bailout due to wreckless lending. And we’re all still paying LPT (2 billion), USC (5 billion)…. Etc. That share buyback won’t be benefiting the taxpayer in the pocket!
@Gerry Kelly: There was no crash. MM said it.
@Gerry Kelly: That was the 2nd time the taxpayers of this state bailed out AIB.
And, if I recall correctly, we’re still paying for the 1st one.
@Gerry Kelly: People may not realise it, but we are still bailing them out via the ECB.
Most of this profit is made on deposits lodged with the ECB at approx 4%, while paying less than 1% to most of their customers.
So another backdoor bailout to all the banks from taxpayers. Compliments of the ECB, led by Christine Lagarde, who is famous for saying while she was in charge of the IMF, if only those pesky Greeks paid their taxes. While she paid none.
guess the whole banks not having to pay tax on profits a former FG minister put in place can now be lifted since they are doing so well…
@Tom Newell: They probably wouldn’t be paying Corporation Tax now anyway as the losses they all recognised during the crash are huge and are carried forward until fully used up.
They pay peanuts to the workforce. Pay rises now..
Remember all this at election time!
@Brian Hunt: Remember what? I don’t get it. Are you saying a bank can’t make a profit. Makes no sense.
@downburst1: I think he might be saying how the taxpayer, sub contractors who took their lives paid for the crash which is been denied by MM
Why was pascal in such a rush to ‘offload’ these shares???…. a blind monkey could see they were about to ‘deliver’ BIG time once any competition was gone
@Ken Mc Carthy: Primarily to get AIB back to private ownership. Governments should not have any investment in banks, especially local ones.
@Cornelius Paul O Mahony: whoooosh….. that went miles over your head—- nobody sells a ‘golden’ goose just before ‘laying’ season
@Ken Mc Carthy: So you were advocating government ownership? That seems to be at odds with your Trumpian views.
@Ken Mc Carthy: You do realise that the shares held by the Government are preference shares, ie not traded and come with a fixed interest rate that doesn’t change.
If AIB shares went up 50% it wouldn’t make one cent extra for the Government.
@Cornelius Paul O Mahony: You seem to forget that ownership brings income from dividends.
And if AIB’s profits go up, then so does the income of the state.
@Ken Mc Carthy: Not just less competition.
With interest rates rising, their profits would rise anyway.
So there was a twin reason to hold the shares.
@ItWasLikeThatWhenIGotHere: Dividends are paid on ordinary shares and the government doesn’t own ordinary shares, it owns preference shares and the interest, also called Dividend, is fixed so it can’t go up or down.
So I really don’t know how what you wrote can happen.
@Cornelius Paul O Mahony: I don’t know why you believe that.
This is an excerpt from gov dot ie about AIB
“In 2017, SFAD planned and implemented an Initial Public Offering (IPO) of a portion of the State’s shares in AIB, listing the stock on the premium segment of the Irish and London stock exchanges.
The IPO resulted in the sale of 28.75% of the bank’s ordinary shares (including a greenshoe mechanism) and recouped €3.4 billion for the Irish exchequer.
Through a combination of fees, dividend income, and disposal proceeds the State has recovered €11.8bn of the €20.8bn invested in the bank, with the State’s remaining 56% equity stake valued at €5.9bn at February 2023.”
Best scam in the world
@J P: they should make a movie out of this…..the ultimate ‘hoodwinking’.
All banks should of became one The People of Ireland bank since it is our money and our sacrifice that kept them going. We could of operate them as a co op / community style banking system.
@Be Lucky: what’s in that for the FAT cats??? …….. ‘ let them eat cake’
@Be Lucky: We have that Credit Unions with 17bn in savings.
@Ken Mc Carthy: I thought you were a Capitalist?
@Be Lucky: what business is it of yours? Why can’t a bank operate within regulated rules? Are you suggesting communism? Perhaps you might get on with making your own life better than worrying about other peoples banking needs.
@downburst1: Regulated rules?
Good one!
Shower of bANKERS
Great work AIB. Time to reinstate staff bonuses to improve retention, the money is there.
Sharing is caring?
Ireland needs a atring domestic banking sector. Lower barriers to competition. Just enough to open the market.
@Al Jo Mc: We had that from the turn of the century, didn’t exactly work out well.
Any bank can setup in Ireland but most don’t want to as evidenced by them all leaving.
@Cornelius Paul O Mahony: they left primarily due to non-existent debt enforcement. sell of the bad loan books and get the hell out of dodge.
@Niall English: They had to transfer to other banks, are you saying they still hold good debt?
@Niall English: Non-existent debt enforcement?
It’s the other way around.
In this country the bank owns the property and the loan. If a person has to sell the property – or it is sold over their head – at a value less than the loan then the borrower owes the difference to the bank.
Forever.
And that will affect their ability to obtain any future loans.
The bank cannot lose.
Despite the fact that it is the bank that has the financial expertise, not the borrower.
In the US it is the other way around. If the borrower cannot make payments then the simply return the property to the bank and walk away.
We must no forget all those people who lost their homes due to the crookery – oh, I’m sorry – the errors made by the banks.
Looks like Ulster and KBC made massive bad calls in leaving the market only weeks before it all turned around. I’m beginning to think these financial experts are just blaggers.
@Dave X: Neither of those banks were unprofitable and left due to other reasons like not getting people out of their houses that had substantial arrears .
Would you operate in such an environment?
@Cornelius Paul O Mahony: if I could earn profits of € 2,000,000,000 yearly! Absolutely
The game is rigged
Yet Irish interest rates are among the highest in Europe and they continue to charge €0.35 for an ATM withdrawal and €0.20 for contactless payments..
No wonder they’re making profit, given that they won’t give a decent rate of interest to anyone under 18 (cannot open a fixed term deposit account), and their joint fixed term deposit accounts can only be opened in a branch, they are paying very little interest to Irish depositors, whilst being able to get a high rate by notionally lending our cash to “the ECB”.
It’s a ridiculous system that magics up net interest margin for the banks.
@C: 100% agree in Europe deposit rates follow the ECB rates , here, it’s exploitation and really needs legislation to fix.
The smart money aka Buffet et al knows that there is a financial earthquake coming in 2024. The former is holding over 180 billion in cash and the clever ones are getting liquid. The American national debt is unsustainable as is ours. When the jig is up Irish banks will having pumped up the property markets both commercial and residential will leave us holding the can again. We still owe 240 billion euro and this time the Euro printing cupboard will be bare.
@gregory pym: I watched an interview with Buffet on that cash pile and he said that there didn’t seem to be much value in US stocks now, going on to say ” we just some time to identify companies that hold value “
We are the best Country for not holding anyone or any company to account when anything wrong is done,they can resign or say sorry,and it’s back to normal,and that’s why our Country is so badly divided,their putting people in jail for TV License,our roads are undriveable,still have to tax,and put more money into the car,coz of the NCT,thats not addressed,I know of a family that ran into trouble,they wouldn’t bring it down,and refused to take what they had,even a solicitor they knew tried to fight for them,if it went to court,the judge would not have listened to the family,they would agree with the bank,the father especially we were waiting to hear he had taking his own life,,Credit Union paid the mortgage,his paying them back,at the rate he can afford.That could be anyone in Ireland now.
I’m sickened reading this, especially when there’s not enough competition and interest rates are so low for anyone that tries to save a few bob!
Why would ye bale out the bank and loose loads of money just too sell your share a when there makeing money I don’t get it
AIB are greedy money grabbers we had our mortgage with kbc and were changed over to AIB we paid 650 a month for our mortgage since joining AIB our mortgage has gone up 4 times we now have to find 1100 a month it’s just sickening
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