PTSB chief says bank must produce results to attract investors
The chief executive of PTSB has said the bank has to 'produce the results that are attractive to investors' as it is about to become the last remaining pillar bank in Ireland in which the State has a significant stake in.
The comments come following a decision by AIB earlier this week to buy back €1.2bn worth of shares from the Government, bringing the State's stake in the bank to 3.3%. Under the terms of the buyback, an off-market purchase of 191,671,857 ordinary shares in the bank will be made at a price of €6.2607 per share.
The State is expected to divest from its remaining share in the company by the end of the year.
When asked about this development, following his bank's annual general meeting, PTSB chief executive Eamonn Crowley said: 'We welcome the divestment of the state from AIB in the sense of how that has progressed, quite good for not only the State, but also for shareholders in AIB and for AIB itself'.
"We will be the last of the three banks with some State stakeholding. Our job is obviously to ensure that we produce the results that are attractive to investors,' he said, adding a key part to this was the bank paying dividends.
"We've stated it's our ambition to pay a dividend next year subject to regulatory approval. So these are all key factors in how we think about our own performance and then our attractiveness to potential shareholders,' he said.
Shares in PTSB were trading at €1.72 on Friday. According to PTSB's share profile, the State owns 57.44% of the bank, which is worth just under €540m.
The Government had invested €3.9bn into the bank during the financial crisis and through a combination of fees, dividend income and disposal proceeds, the State has to date recovered €2.7bn.
In its latest trading update, PTSB said the impact of lower interest rates had seen its net interest income drop by 9% during the first three months of the year, but it has kept its targets for the year in place on the back of strong lending.
The lender now holds a 20% share of the Irish mortgage market, up from just over 16% at the end of 2024.
New business lending was also up 25%, with total gross loans rising to €22bn, up 1% since the year-end. Customer deposits also rose, increasing by 3% to a total €24.9bn.
Mr Crowley said demand for mortgages as well as business lending was strong.
He said there was 'more than the sense' the bank was a 'challenger' now in the market when it comes to business lending.
'We're picking up new business in that sense.'
Earlier this year, PTSB said it was well-provisioned coming into 2025 and modelled more 'conservative' impairment scenarios than the consensus due to uncertain global economic outlook.
PTSB chief financial officer Barry D'Arcy said despite the global upheaval in trade seen in recent months, 'we're not seeing anything on the ground in terms of customer behavior or anything to that effect'.
'We're not seeing anything right now, which is really positive. The Irish consumer is very resilient, and the way we've underwritten portfolios in recent times have changed, and then the macro credential rules came on top. So I think it's in a pretty good space,' he said.
Read More
IAG posts profit surge despite €55m loss at Aer Lingus
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
RTÉ News
32 minutes ago
- RTÉ News
What do falling interest rates mean for borrowers and savers?
As widely expected, this week, the European Central Bank (ECB) cut interest rates by a quarter of a percentage point, bringing the main deposit rate down to 2%. It was the eighth consecutive cut, and the main interest rate is now at its lowest since the end of 2022. Between September 2023 and this month, rates have fallen by two percentage points overall - down from 4%. While we're still a long way off from the zero-percent ECB rates that persisted in the wake of the financial crisis, the fresh reductions bring more welcome news for borrowers. The 180,000 tracker mortgage customers in Ireland will see an immediate benefit, with their loans tracking the main ECB lending rate. Borrowers on variable rates will also see repayments fall but not necessarily right away. It will depend on the terms of their loan. Some lenders adjust variable rates monthly, others do it quarterly, while it can also be done on an annual basis. The ECB's 25 June basis-point cut means that for every €100,000 borrowed, monthly mortgage repayments will fall by around €13. This means payments falling by €65 monthly - or €780 annually - on a loan of €500,000. However, fixed-rate customers - which the majority of borrowers tend to opt for - won't see their repayments dropping. Though they will be in a stronger position to get a lower rate once their fixed-term has ended. Irish mortgage rates sixth highest in euro zone Even with the these latest cuts, Irish mortgage holders are still paying nearly half a percentage point more in interest than their euro zone counterparts, with rates here - averaging 3.67% - the sixth highest of the 20 countries using the euro. Fixed rates here can be as low as 3%, but after the ECB announcement on Thursday Sinn Féin Finance spokesperson Pearse Doherty pointed out that some borrowers, whose loans were sold to so-called vulture funds by the pillar banks that needed to offload bad loans, are paying much higher rates. According to Mr Doherty, last year there were over 100,000 households paying over 6% in interest to such funds, with 7,000 paying over 8.5%. He said "that can mean handing over thousands of euro more a year to these vulture funds than they would even with the high rates at traditional banks". The Sinn Féin TD is also calling on lenders to pass on the benefit of the ECB cuts promptly, adding that "the refusal by banks to pass on the benefit of interest rate cuts ... is completely unacceptable and the Government should immediately call in the banks. "Banks in the main have not cut mortgage interest rates in line with the four-interest rate cuts this year," he said. But lenders will argue that they did not pass on all of the increases when rates were going up in previous years. Good for borrowers, bad for savers Anyone investing money and hoping for a decent return won't like falling interest rates. Irish savers have around €160 billion on deposit and in recent months all of the main lenders - as well as the fintech banks - have reduced rates for savers and it's getting trickier to get make money on savings. Around 3% is the best rate available right now, though it you're looking to save more than a couple of thousands euro every month the rate will be closer to 2%. But these deposit rates are falling in line with the ECB cuts, and by the end of the year the best rates on the market for savers are expected to be nearer 1.5%. The advice to those looking to invest is to do so sooner rather than later to try and lock in a higher rate. What's likely to happen next? Interest rates are the ECB's main tool for managing inflation across the euro zone, with a target level of 2%. When inflation goes higher, rates are increased to discourage borrowing and encourage saving to bring it down. It's the opposite when inflation is lower - rates are lowered to help boost economic activity. Latest figures show euro zone inflation has fallen just below 2% (1.9% in May down from 2.2% in April) and with fears of global trade uncertainty, weaker economic activity, and a strengthening euro, interest rates are expected to be reduced further in the coming months. The general consensus is that we'll see the ECB lower its main deposit rate by another quarter of a percentage point - to 1.75% - and then settle at that point. This means mortgage holders should get a further boost, while savers will need to look that bit harder to maximise any returns. However, as with most things economy-related, trends are cyclical and we could easily end up in a new economic reality in the near future that necessitates the next cycle of either interest-rate cuts or rises.
Irish Independent
2 hours ago
- Irish Independent
‘The figures for 2025 are correct, but the 2024 figures were wrong': Why the tourist industry is staying optimistic about the outlook
'If anyone asks, Irish tourism is doing very well, thank you very much,' Alva Pearson Downey, CEO of the Inbound Tourism Operators Association (ITOA), said at the end of May.
Irish Daily Mirror
3 hours ago
- Irish Daily Mirror
Trumpugees moving to Ireland cite housing crisis and expenses as major drawbacks
Rising numbers of Trumpugees are exploring relocation to Ireland but they are finding the country's welcoming reputation doesn't extend to its immigration laws. While English-speaking countries likte Ireland, the UK and Canada top the list for prospective American emigrants, countries such as the Netherlands, Germany and Portugal offer far less restrictive entry pathways. So far this year, the number of US applicants for Foreign Birth Registrations – a pathway to Irish citizenship for those with Irish grandparents – has nearly doubled compared to the same period last year. By the end of May, more than 8,000 Americans had applied under the so-called 'granny rule,' hoping to secure the coveted Irish passport. Jana Sanchez, a former US congressional nominee and founder of GTFO Tours, says Ireland consistently ranks high on the wish list of Americans considering emigration. 'The first countries that most Americans would think of to move to are English-speaking countries, like Canada, the UK, Ireland.' But she added: 'They don't really want Americans. You're the hardest countries to go to, unless you're a nurse or a scientist.' A key obstacle is Ireland's high passive income visa requirement, which she says is used by about half of American emigrants. 'They are retirees or have made enough money. For a couple, you need €100,000 a year in passive income to get a visa,' Sanchez explained. 'Compare that to Portugal, where it's about €10,000 per person – around €15,000 for a couple.' 'Ireland also has a huge housing crisis, and it's just much more expensive.' Rosie O'Donnell – currently in the process of acquiring Irish citizenship through her Irish grandparents – credited her decision to Trump's second inauguration. Sanchez said many of her clients are from vulnerable communities. 'A huge number of LGBTQ, especially trans people, are really scared,' she says. 'In Texas, they're debating whether to make being trans a felony punishable by two years in prison and a $10,000 fine.' Miglena Ilieva, managing partner at ILEX Law Group, which specialises in Irish and UK immigration law, is advising a retired academic couple from Illinois hoping to relocate to Ireland. They are currently based in Portugal while they work on qualifying for Ireland's Stamp 0 visa for people with independent means. 'They're both at a university in Illinois and were looking for a way to retire in Ireland. They want to come to Ireland because it's so culturally similar to what they're used to, and they can navigate it. 'They're in Portugal right now, and they're having a nightmare with the language. They don't want to be there, they want to be in Ireland.' The couple is a few thousand euros a year short of the income requirement, but they are exploring investment options to close the gap. They remain positive despite housing and cost-of-living challenges, describing Ireland as 'friendly, vibrant and gorgeous'. Ilieva says there is growing interest from Americans, with dozens of recent inquiries but while many Americans have Irish ancestry, most don't qualify for citizenship. Other options include a working visa which requires a job offer. In recent weeks, the Irish Government has acknowledged the potential to attract top US researchers with its Global Talent Initiative. Minister James Lawless said Ireland would remain open to 'the best and brightest fleeing the US university system'. 'We are committed to supporting Irish researchers at home and to welcoming exceptional global talent who might now be questioning where they can further their work,' he said. He pledged €9 million in annual support for researchers in key fields like AI, semiconductors, digital healthcare, and food security. The UK already operates a Global Talent Visa that allows researchers and academics to move without a job offer, provided they are endorsed by an approved body. Ilieva believes something similar could help Ireland attract top global talent. Amanda Klekowski von Koppenfels, a US-born migration expert and academic coach who studied at Georgetown and Harvard, says Ireland isn't widely known in the US as an academic haven – yet. In her role as a coach to people in career transition or who wish to move out of the US, she sees 'huge interest in Ireland'. She added: 'It's English speaking. It's part of the EU. A number of people are actively trying to apply for jobs and in order to get an employer-sponsored visa. 'What I'm finding, though, is that not everybody has a really strong knowledge of what even visas are, what the European Union is. 'It's not something they've ever had to think about before.' Klekowski von Koppenfels has worked with everyone from climate scientists to psychotherapists and journalists considering a move to Ireland. Often, they're professionals seeking a less stressful life. She said: 'Ireland is progressive, and since we have so many Irish in the United States, it's a bit of a known quantity.' In terms of people considering Ireland, it is in the 'dozens ' or 'possibly in the hundreds|', and from areas such as the east coast to Ohio. She estimates 1% to 2% of Americans – potentially 3 to 6 million people – are seriously considering leaving the US. 'Certainly, people are applying for Irish passports and getting those recognised. It's something I do hear quite a lot of.'
