Allied Irish Banks says on track for pre-provision operating profit
* On track to return to pre-provision operating profit for FY13
* Says 19.6 bln eur of non-core deleveraging completed by end Q1 2013, c. 95 pct of the year end 2013 target
* Expects to have fully achieved the non-core deleveraging target by Q3 2013 at levels comfortably within the PCAR 2011 capital assumptions
* says no material impact on balances as a result of the expiry of government's Eligible Liabilities Guarantee scheme
* Says bad debt provisions for 2013 are expected to trend significantly lower from levels in 2012
* Says group's core tier one capital ratio was 15.0 pct at end March 2013
Allied Irish Banks on track for 2013 profit
LONDON--Allied Irish Banks PLC , effectively nationalized, said Tuesday it is on track to achieve its target of returning to pre-provision operating profit for the full year 2013, adding that cost reduction remains a priority at the Group and the benefits of the initiatives undertaken in 2012 are beginning to be seen.
MAIN FACTS:
-For the quarter, both staff costs and other expenses are materially lower year on year, as expected.
-Product repricing has had a continued positive effect on the net interest margin, or NIM, in the first quarter, the second consecutive quarter of progress on NIM.
-Repricing and the ending of the Eligible Liabilities Guarantee Scheme, or ELG, for new liabilities announced on Feb. 26 and effective March 28 are expected to benefit operating income for the remainder of 2013 and beyond.
-19.6 billion Euros of non-core deleveraging was completed by the end of first quarter of 2013, which is 95% of the year end 2013 EUR20.5 billion non-core deleveraging target as originally set by the Central Bank of Ireland.
-AIB expects to have fully achieved the non-core deleveraging target by the third quarter of 2013 at levels comfortably within the PCAR 2011 capital assumptions.
-Following growth of EUR2.9 billion in 2012, customer accounts continued to increase in the first quarter of 2013 and there has been no material impact on balances as a result of the expiry of the ELG.
-Use of Monetary Authority funding has further reduced by EUR2.6 billion since December 2012 to EUR19.6 billion as of end March 2013.
-Group's loan portfolios are performing in line with expectations and bad debt provisions for 2013 are expected to trend significantly lower from levels in 2012 based on current expected economic performance.
-AIB's capital ratios remain strong; Risk Weighted Assets have reduced, driven by further deleveraging in the first quarter of 2013 and the Group's core tier one capital ratio was 15.0% at the end of March 2013.
AI
