Aib Profits fall

03 March 2009
share post tweet

Despite the downturn Aib still expects to announce a profit for 2008 of €580 million.

When this is compared with some of the massive banking losses being disclosed elsewhere it gives some reassurance in regard to the underlying strenght of the bank

The bank says it will take a charge for bad debts of around 1.37% of its average loans, up from the previous 0.75%. Based on its November estimate, this would amount to more than €1.8 billion in total.

AIB said it had increased its estimates of bad debt charges from November due to worsening economic conditions. This included an extra €500m set aside to cover 'a portfolio of identified cases', of which 75% related to Irish property development loans. Although these loans were not yet bad, it said they were showing 'growing signs of stress'.