Ulster Bank has set aside £28 million (€35 million) to cover the cost of the recent technology outage.
An investigation into the issue, which left tens of thousands of customers without access to funds for a number of weeks, is currently under way.
“Given the scale of the impact on our customers, we expect that there will be additional costs over the coming months as we continue the process of putting things right,” chief executive Jim Brown said.
Revealing its interim results this morning, Royal Bank of Scotland's Irish arm said loan impairments fell in the first half of the year, following "substantial provisioning" of land values in 2011.
The figures for the first six months of 2012 showed Ulster Bank's core impairments were in line with the same period of 2011, at £717 million (€907 million). Non-core impairments fell by almost £1.4 billion for the same period.
But impairments are to remain high for the rest of the year at the Irish branch, RBS said.
Net interest income fell in the first half of the year to £325 million, compared with £363 million a year earlier. Losses at the Irish bank widened to £555 million, up from £543 million in 2011.
Deposits fell 9 per cent on a constant currency basis, but the decline was mainly due to wholesale balances, with retail and small business deposits remaining stable.
Trading conditions remained difficult, as Irish economic indicators continue to be weak," the banks said in a statement. "The high cost of funding has an adverse impact on income, while impairment levels are still elevated, asset prices weakening over the period and residential mortgage arrears continue to rise, albeit with less deterioration in credit metrics in Q2 than in Q1 2012."
The RBS group today reported a fall in profit for the first half of the year, with operating profit of £1.83 billion down from £1.97 billion in the same period last year.
RBS confirmed it has set aside a further £135 million to compensate customers mis-sold loan insurance.
The group said its recent technology problems, which affected millions of customers at RBS and Natwest in the UK and Ulster Bank in Ireland, would cost at least £125 million, mainly in customer redress. However, the bank was not ruling out the possibility of further charges, and said an investigation into the incident was under way and would be overseen by independent experts.
The lender also said today it had dismissed a number of employees for misconduct as a result of its investigations into the Libor interest rate rigging scandal and along with other banks is still under investigation by regulators.
Additional reporting: agencies
