Anglo Irish Bank expects slower growth next year due to the economic downturn, its chief executive Mr Sean Fitzpatrick said yesterday.
But shares in the business bank rose 8.16 per cent to €4.11 (£3.23) from €3.80 after it reported a 46 per cent rise in pre-tax profits to €194.8 million from €133.6 million in the year to the end of September. Almost 4 million shares changed hands.
Mr Fitzpatrick said the downturn was "certainly a little bit exaggerated" and the bank was well positioned to expand strongly this year. However, he accepted that a 41 per cent rise in earnings per share to 41.92 cents from 29.73 cents was "exceptional" and would not be repeated.
Uncertainty in the market meant that business people were forestalling decisions in the property market, where Anglo Irish generates most of its profits, rather than abandoning strategies. Demand was "pent up".
The results showed a 38 per cent rise in lending to €11.52 billion from €8.3 billion. Anglo Irish said lending growth in the current year was likely to fall to 15 per cent, though the bank said that could be exceeded. The bank expects to compensate for any domestic downturn with growth in its British business, which accounts for 37 per cent of its loan book. It argues the Irish and British economies are counter-cyclical.
Mr Fitzpatrick said the quality of the bank's loan book would not deteriorate in the downturn.
The fall-out from the attacks on the US on September 11th would affect tourism next year. About 11 per cent of the bank's loans are tourism-related, in the leisure and entertainment sectors, but it said 75 per cent were on the east coast and less exposed to the downturn.
Provision for bad debts rose by €69.7 million to €212 million, though the bank said that €146 million of the provision was a general one with the growth "specific" provisions actually declining.
Profits after tax and dividends rose to €124.1 million from €83.9 million. Deposits rose 41 per cent to €13.84 billion from €9.85 billion in the year. Overall revenues rose to €382.6 million from €273.4 million. Interest charges yielded revenues of €269.5 in the year. Fees and commission generated €99.4 million, and €13.7 million was derived from other sources.
