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AIB posts €2.6bn loss for first six months of 2011

AIB loses €5bn in deposits in between January and June, but made €2.2bn with public help and the sale of its Polish arm.

Image: Eamonn Farrell/Photocall Ireland

AIB HAS REPORTED an underlying loss of €2.6bn for the first six months of 2011, complaining that “funding conditions remain highly challenging” in a turbulent Irish economy.

Announcing its interim results for the first half of the year this morning, the bank reported a headline profit of €2.2bn – but this total included the sale of its Polish operation, Bank Zachodni WBK, and the government’s cash injections.

The bank said it had seen its deposit book fall by €5bn or so in the first half of the year – not including the acquisition of over €8bn in loans from Anglo Irish Bank.

Its loan book, meanwhile, fell by €11bn through a combination of ‘action’ and a process of natural deleveraging.

The bank’s €260m profit before tax, for its continuing operations, compares favourably to a €2.4bn pre-tax loss for the first six months of 2010.

In its release the bank also confirmed that its EGM, being held tomorrow, would vote on a series of new resolutions which would see the taxpayer purchase an extra 500 billion shares in the bank.

If this move goes through, the State will then hold a 99.8 per cent stake in what was once Ireland’s largest bank.

Stress tests published in March required the State to inject another €13.3bn into AIB, bringing the total public investment to €24bn.

Shares in the bank closed at 12.4c each on Friday.

Read AIB’s full results release (PDF format) >

About the author:

Gavan Reilly

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