BoI chairman flags ‘ambition’ to pay dividend in 2017

Bank of Ireland chairman Archie Kane told shareholders on Thursday it was the company's "ambition" to pay a dividend in the first half of 2017 relating to its full-year results for this year.

“We will do that very carefully and very prudently,” he told the bank’s annual general court in UCD. This would be the first dividend paid by the bank since the financial crash.

Earlier, shareholder Seamus Flood said he would rather forgo his dividend than see mortgage customers in arrears "being put out on the side of the road".

Mr Kane told the meeting 36 houses repossessed had been so far this year. In 2015, the figure was 176, mostly voluntary surrenders. He said the bank strived to keep families in their homes where possible.

Complacent

Solicitor Brian O’Donnell, who has been in a long-running dispute with the bank over his family home, called for the board to be replaced and informed the meeting that a website called Removeboiboard.com had been set up.

This is backed by a limited company based in Kent, Remove BOI Board Ltd, that will seek proxy votes to try and effect management and board changes.

Mr O’Donnell said the board was “very complacent” and “low on energy”, adding that it had “alienated” customers since the crash.

Independent TD Shane Ross questioned why board members owned so few shares in the bank, citing Mr Kane’s holding of 11,074 shares, which are worth just under €3,000 at present.

He said Mr Kane had earned about €2 million in fees from the bank in the past four years and yet his holding was smaller than most “shareholders in the room”.

Mr Kane said each board member’s holding was a personal matter with them being required to hold a minimum 1,000 shares under the company’s bylaws.

He also defended the remuneration of chief executive Richie Boucher, which came in for criticism from a number of shareholders. The chairman said Mr Boucher had worked "incredibly hard over a number of years" to return the bank to profitability.

Earlier in the day, Bank of Ireland said trading so far this year was “in line with expectations”.

It said improvements had been achieved in the volume of non-performing loans while new lending increased.

But its pension deficit widened to €900 million and its UK loan volumes reduced due to recent sterling weakness created by uncertainty over the Brexit referendum.

Its net interest margin averaged 2.11 per cent during the period.

Its non-performing loan volumes had fallen by €900 million since December 2015 to €11.1 billion at the end of March 2016, with reductions across all asset classes. Its defaulted loans had reduced by €800 million to €9.8 billion.

The bank’s balance sheet was hit by the translation impact of sterling assets and liabilities with customer loan volumes reducing to €81 billion in euro terms at the end of March 2016.

The decrease in the value of sterling accounted for about €3 billion of the movement in customer loan volumes.