Analysis Bank of Ireland's group chief executive, Mr Mike Soden, has ruled out the sale of its British building society Bristol & West and stressed that it is firmly focused on growing the business.
He said its British subsidiary had achieved a 20 per cent return on equity and had delivered 30 per cent of the group's profits but could do even better.
"Selling Bristol & West is not even a consideration. Why would we even consider doing that now that it is a much tighter set-up than it was this time last year?"
The bank has appointed Mr Roy Keenan to the British business and he is expected to detail his strategy for growing that business when the bank reports half-year figures in July.
Mr Soden said he was very upbeat about the bank's prospects in the coming year. Equity markets had improved since the end of March, he said, a factor which should begin to yield benefits for the group's life assurance and fund management businesses.
The mortgage market continues to be buoyant with the bank also reporting some improvement in sentiment from the business sector, with demand for credit facilities gaining momentum.
Its asset management business has been attracting substantial levels of new business, with €6.1 billion flowing in last year. Some €1.8 billion came from US investors with a further €1.3 billion from Japan, with Ireland and Britain accounting for more than €2 billion. The performance was broadly in line with stock market expectations, with analysts viewing its future prospects quite positively.
Mr Soden has said the bank will pursue a four-pronged strategy seeking organic growth, examining possible mergers and acquisitions, and capital and cost management.
The bank has started a rolling share buyback programme and has spent €135 million buying back 1.3 per cent of the stock. It is expected to continue to be active in the market, with Mr Soden stating that the buyback would be reflected in its return on equity and earnings per share ratios in due course.
The Group Transformation Programme, which is in its third year, would deliver cost savings in the order of €75 million, he said.
Bank of Ireland met 105 per cent of its pension fund liabilities in the past financial year but noted that if it had adopted the new accounting standard, FRS 17, it would have posted a deficit of €681 million. Yesterday the bank noted that it was not obliged to implement the standard until March 2006.
