AIB: Allied Irish Banks expects to rebound from loss with new loans
The Irish lender, which recorded a loss of € 909m in the first half of the year after setting aside most provisions, has set aside € 1.46bn in total to cover potential defaults resulting from the pandemic COVID-19, according to its forecast.
AIB’s new loans fell 25% year on year to 9.2 billion euros, against an expected drop of 30%. CFO Donal Galvin told Reuters the bank expected to recover some of it in 2021 with more than € 10 billion in new loans.
The company is in expansion mode after entering into a non-binding agreement to purchase € 4 billion in Irish business and corporate loans from NatWest and this week acquired Ireland’s leading financial services firm Goodbody Stockbrokers.
He said on Friday he was in advanced talks with Irish Life owner Great-West Lifeco to establish a life insurance and pension joint venture under the AIB brand, which Galvin said he hopes to launch in the first half of the year. next year.
He added that the deal with NatWest, which ends its Irish operations, would be accretive to the 2023 targets, but AIB’s main goal is to increase its corporate customer base.
“That’s a third of new loans in a normal year, so it’s not transformative of a balance sheet (perspective), but in terms of customer acquisition strategy, we think it’s very, very important to acquire 5,000 customers at one time, “he said.
AIB announced in December its intention to cut its workforce by 15% and withdraw from the UK small and medium-sized business lending market as it seeks to meet its capital and profitability targets.
($ 1 = 0.8365 euros)
(Reporting by Padraic Halpin; Editing by David Goodman)