PROFITS after-tax from banking operations rose by 14 per cent to £18 million at Irish Intercontinental Bank last year, while its IFSC operation was also growing rapidly, the bank reported yesterday.
"This year has been one of considerable achievement, with the consolidation and growth of our strong positions in the corporate and home loans market here in Ireland and in Britain, and the rapid development of our group's international operations," said the bank's chairman, Mr Paddy McEvoy in its annual report.
The reported 14 per cent increase was in profits after tax, minority interests and preference dividends. This indicated a 24 per cent return on investments, the firm added. Also in 1996, the bank opened an office in Hong Kong and began recruiting for a similar office in New York due to open this year.
Mr Ted Marah, the bank's chief executive, said IIB's assets had risen 36 per cent in the 12 months to the end of 1996, to £2.34 billion.
Advances climbed 43 per cent, to £1.69 billion, while deposits rose 36 per cent to £2.2 billion, the bank said.
As a privately-owned company, the bank said it was not obliged to reveal details of how each sector of its business had fared. However, with its statement, IIB supplied a pie-chart recording that 30 per cent of its profits, before overheads were taken into account, came from the retail sector. International banking contributed 27 per cent, domestic banking 25 per cent and treasury 18 per cent.
Irish Life Finance Group, the joint retail venture established with Irish Life, now controlled 7 per cent of the domestic residential mortgage market, the company said. Residential home loan advances totalled £140 million.
The bank's IFSC operation, KBI Financial Services, was now seen as a major financial player in the aerospace industry, Mr Marah said, and had done business with 50 of the world's top airlines.
It had also been involved in financing more than 40 major infra structure projects, including power stations, cable television networks, telecommunications and private roads, he added.
Mr Marah said the bank saw considerable potent for growth in the Asia-Pacific area, and that this analysis had prompted the opening of the new office in Hong-Kong. The fact that the colony would revert to China at the end of the year did not dissuade IBB, he added. "We're not worried about Hong Kong. We believe that the Chinese are committed to the policy of one country, two systems, and we're comfortable about being there."
He denied that the Hong Kong and proposed New York bases were a hedge against future changes in the tax structures at the IFSC.
"The business in Hong Kong, New York and in our Brussels office will be written here in Dublin. Those are production offices. Our IFSC business is not tax-driven. We're in the IFSC for the long haul," said Mr McEvoy
The company is 75 per cent owned by Belgium's Kredietbank with Irish Life Assurance holding the remaining 25 per cent.
The bank said its project to ease its business into European economic and monetary union was already up and running. On balance, Mr McEvoy added, the Republic being in the first wave of EMU membership would be good for the bank.
