Bank of Ireland welcomes €3.5bn investment by Irish Government; Expects €4.5bn in bad debt losses over 3-year period
Feb 12th, 2009 | By Finfacts Ireland Business & Finance Portal | Category: News worldwide
The Bank of Ireland said today its capital position is strengthened by the Irish Government's announcement to provide €3.5bn core tier 1 capital and provides a significant buffer to withstand loan impairment charges well in excess of both the current estimate and the downside risk to these estimates. The bank said it has revised the 3-year bad debt charge outlook shared with the market at our Interim Results for the 6-months to 30 September 2008 from circa €3.8b to about €4.5b, of which €1.4bn is expected to arise in the year to 31 March 2009. The increase in the 3-year estimate is predominantly driven by a significant rise in unemployment expectations and a consequent increase in risk in our consumer, mortgage and smaller business portfolios, mainly in Ireland.