Irish Life and Permanent (IL&P) said its operating loss narrowed by 80 per cent from €51 million to €10 million in the first half of the year.
The group attributed the improvement in its financial performance on a significant recovery in the performance of its Irish Life businesses.
Irish Life posted an operating profit of €118 million for the six-month period under review, up 40 per cent on the €84 million recorded a year earlier. At 12.42pm shares in the firm were up 2.8 per cent at €1.43, a gain of 4 cents.
The group's banking business Permanent TSB posted a loss of €131 million, down 1 per cent on the same period last year.
During the first half, the bank reduced provisions for bad loans by 21 per cent or €39 million, principally as a result of an improvement in the performance of the bank's car finance and personal loan book in Ireland and in its UK mortgage loan book. The benefit of this reduction was largely accounted for by the increased cost of the new Guarantee Scheme however.
Arrears in respect of Permanent TSB’s Irish mortgages continued to rise. The group said arrears increased by some 28 per cent and said it was working with customers to help them agree new terms on repayments.
Chief executive Kevin Murphy expressed confidence that the group was on a recovery path and said that while there would be further losses recorded in the bank in the second half of the year, "the life business should continue to perform well".
Mr Murphy confirmed the group has submitted a proposal in respect of EBS Building Society. He said that a another Irish-based financial institution was needed to provide competition and consumer choice and added he believed a merger of Permanent TSB bank and EBS Building Society could help create a "third force" for Irish banking.
