IBRC reports half-year loss of €724m

The Irish Bank Resolution Corporation made a loss of €724 million in the first six months of the year as impairment charges remained high.

The figure compares with a loss of €873 million for the full year in 2011.

The State-owned bank, which is winding down Anglo Irish Bank and Irish Nationwide, said operating profit was €359 million before disposals and provisions of more than €1 billion.

The provisions during the period included a specific lending impairment charge of €878 million. Some €18 billion of the bank's loans are impaired.

Net interest income rose 14 per cent to €538 million.

The bank cut expenses, with operating costs to €129 million from €157 million in the prior period. IBRC has reduced its workforce by 15 per cent since the end of 2011.

Non-staff costs were also lower, falling by 21 per cent to €79 million as professional fees related to asset recovery fell.

In total, IBRC has assets of €53.2 billion, a fall of €2.8 billion due to reduced customer loan balances. About half of the assets are Irish Government promissory notes, the bank said.

Group chief executive Mike Aynsley said Ireland was the worst affected of the bank's markets, and accounted for
the majority of the €878 million impairment charge.

“The first six months of 2012 continued to present significant economic challenges for IBRC," Mr Aynsley said.

"Notwithstanding the continued macro economic challenges, the six month period to June 30th, 2012 was one of relative operational stability and steady progress towards the orderly wind down of the bank.”

The bank also said it had continued to actively manage and vigorously defend all legal claims, but denied it had a vendetta against former tycoon Sean Quinn and his family.

"We don't have a vendetta against anyone," Mr Aynsley told RTE Radio One . "Our job is to recover the money that is owed to us and we are just going about our business doing that."

Chairman Alan Dukes said a number of factors, including the prevailing uncertainty in Europe, a lack of bank funding and weak commercial and residential property markets in Ireland and the UK, would lead to a challenging environment for the bank as it worked to meet objectives in the second half of the year.

Additional reporting: PA