Bank of Ireland posted a 10 per cent rise in first-half earnings as expected today but reduced guidance for full-year growth, blaming turmoil in global financial markets and a cooling economy.
Underlying earnings per share rose to 80.1 cents in the six months to the end of September.
EPS growth was 13 per cent when the contribution from broker Davy, which Bank of Ireland sold in October 2006, is excluded from numbers for the year before, Bank of Ireland said. The bank's pre-tax profit of €1.091 billion for the six months to the end of September was up 24 per cent from the €879 million recorded during the same period last year.
"Looking to the second half of our financial year underlying momentum in our business remains positive but is moderating in line with reduced economic growth in our main markets," the company said in a statement.
Ireland's second-biggest bank by market value said that meant it now expected percentage growth in underlying EPS for the year to the end of March 2008 to be in high single digits versus an earlier forecast of low double digits.
"At a time when banks all over the world are announcing whopping write-offs, I would still view our refined guidance as reflecting very positively on the underlying business trends across the group," chief executive Brian Goggin told reporters.
The bank, whose shares have fallen 40 per cent so far this year, said its loan losses remained low and described its asset quality as excellent while chief financial officer John O'Donovan said there were no nasty surprises in store.
"We're absolutely telling you that there's nothing in our balance sheet that's overhanging to come out to bite us because it just isn't there," Mr O'Donovan said.
Bank of Ireland said its Tier 1 ratio measure of capital strength dipped slightly to 7.6 per cent at the end of September from 7.7 per cent at the same time last year but that it would have been 8 per cent if a €400 million securities issue in October had been completed during its first half.
The company's financial assets available for sale, which stood at almost €33.5 billion ($49 billion), lost €164 million in fair value in the period versus a gain of €1 million a year earlier.
In terms of bad loans, the bank said it took a charge of €79 million in the first half which was up from €48 million in the same period a year earlier.