Loan losses drag EBS into the red

the_edge · April 29, 2010, 11:38am

Building society EBS made a loss almost €80m last year, after putting aside almost €200m to deal with potential losses from loans.

EBS said its underlying business performed well, with profits up 33% from the previous year to €96m.

But a loan impairment charge of €195m meant the society made an after-tax loss of €79m. Around €83m of this charge was linked to assets which are being transferred to the National Asset Management Agency.

The Government last month announced that it was prepared to provide €875m needed by EBS to meet financial targets set by the Financial Regulator.

Chief executive Fergus Murphy said EBS would submit a restructuring plan to the EU by the end of June, and that this would include a review of all the options open to it. The society also said talks with private equity group Cardinal - announced earlier this month - on a possible investment in EBS were continuing. This could fully or partly take the place of any State investment.

The society said it increased its share of new mortgage business and its share of the savings market. It said it reduced costs by 9% to just over €82m.

EBS also paid the Government €7.9m as part of the bank guarantee scheme.

rte.ie/business/2010/0429/ebs.html