National Irish Bank (NIB) has set aside €146 million for loan impairment charges related to losses on commercial property transactions.
The bank, which is outside the Government's guarantee scheme, said impairment charges related to bad loans were down €52 million on last year.
The Danish-owned lender today reported losses of €133 million for the first three months of the year, saying economic conditions remained “very difficult”.
The bank’s total loan book was €10.2 billion, down 5 per cent on last year. Nearly a third of the loan book, some €3.3 billion, related to commercial property which accounted for most of the impairment charges.
Mortgages represented €3.7 billion with loan quality described as “satisfactory”.
Despite a 21 per cent increase in deposits year on year, income fell 19 per cent to €42 million due to lower demand and lower deposit margins, the bank said.
NIB chief executive Andrew Healy said economic and trading conditions continue to be very difficult and the banking sector is going through dramatic change.
“While our loan impairments continue to trend downwards, they remain high. Last December we announced a major restructuring programme to reduce our costs and to reposition the bank to ensure we have a strong future in the Irish banking market of tomorrow. This programme is on track," he said.
“Our parent, Danske Bank, is one of the best capitalised banking groups in Europe,” he added.
Danske Bank today reported first-quarter profit that exceeded analysts' estimates after costs and loan losses declined.
Net income fell to 769 million kroner (€103 million) from 1.57 billion kroner (€210 million) a year earlier, the Copenhagen-based lender said in a statement today.
Danske was the Nordic lender that suffered the largest loan losses last year because of provisions in Denmark, the Baltic states and the Republic of Ireland.
It said today that while the level of loan impairment charges "is likely to remain high" this year, it will be lower than in 2009.