Profits at ICS up by 15.6% to €65.1m

A doubling in new mortgage business pushed pre-tax profits at Bank of Ireland-owned ICS Building Society up by 15.6 per cent to €65.1 million last year.

The company, which holds an estimated 26.5 per cent share of the new mortgage market, lent €931 million to new buyers last year, marking a rise of 53.5 per cent on 2001.

Buy-to-let mortgages accounted for about a quarter of the new loans, up from one-sixth the previous year.

ICS managing director Mr Joe Larkin said the building society was "quite happy" with its investor loan book, noting that it was not "at the risky end" of the market.

He added that ICS was factoring in a possibility that rents would drop further this year, thus creating problems for more "amateur" investors.

Net lending at the building society, which takes account of mortgages paid off in the course of the year, rose by 55 per cent to €618 million in 2002.

Net interest income climbed by 9.2 per cent to €66.4 million, while mortgage margins were steady.

Deposits grew by 11 per cent to €2.4 billion as savers shifted money from demand deposits into the building society's combination equity bonds.

Mr Larkin said the first quarter of 2003 had also been strong for ICS.

"There's still a lot of money out there," he said.

Mr Larkin predicted that house prices would rise, on average, by about 6 per cent this year but warned that most of this growth would come in the second-hand sector as the cost of new homes stabilised.

ICS estimates that it holds 8.3 per cent of the overall mortgage market, up from 7.8 per cent a year ago.

"ICS is well placed to continue to grow strongly," Mr Larkin said, adding that the company planned to open a new Mortgage Store in Dublin's IFSC shortly.