Bank of Ireland Group has reported an underlying profit of €376m (£344.4m) for the first half of 2019 that ended 30 June, compared to €500m (£458.04m) it reported in the same half in 2018.
The total income of Bank of Ireland in H1 2019 moved up 1% to €1.41bn (£1.29bn) compared to €1.39bn (£1.27bn) in H1 2018.
The Irish retail and commercial bank said that its net interest income of €1.069bn (£980m) for the reported first half is in line with H1 2018, which reflects lower Net interest margin (NIM) of 2.16%, that has been offset by higher loan volumes.
Its operating profit pre-impairment surged 9% from €398m (£364.6m) in H12018 to €435m (£398.49m) in H1 2019.
Bank of Ireland records net lending growth of £1.1bn
The Irish bank reported €1.2bn (£1.1bn) in net lending growth in H1 2019 and expects a further increase to it in the second half of the year, while maintaining risk and commercial discipline.
According to the bank, all its trading divisions increased their operating profit pre-impairment in the first half of 2019. The bank reported a 3% reduction in its operating expenses by €30m (£27.48m) to €903m (£827.22m), compared to H1 2018.
In its retail Ireland business, the bank reported €263m (£240.93m) underlying profit before tax in H1 2019, compared to €345m (£316.05m) reported in H1 2018. The wealth and insurance business increased its underlying profit before tax from €34m (£31.15m) in H1 2018 to €84m (£76.95m) in the reported period.
In the retail UK business, the underlying profit before tax dropped from £99m in H1 2018 to £80m in H1 2019. There was a drop in the corporate and treasury unit’s underlying profit before tax as well, from €233m (£213.45m) in H1 2018 to €207m (£189.63m) in H1 2019.
Bank of Ireland Group CEO Francesca McDonagh said: “There has been a change and material lowering in interest rate expectations, extended Brexit uncertainty continues to influence the pace of credit formation in Ireland, and competition in the UK mortgage market has intensified.
“These external headwinds present challenges to our ability to generate the income and loan growth that we set out at our Investor Day. In response, management is focused on a range of actions to mitigate these effects.”
Last month, Bank of Ireland announced its decision to divest its UK credit cards business to Jaja Finance and funds affiliated with Centerbridge Partners and KKR, for £530m.
