THE EBS HAS posted record losses of €590m for 2010 as it prepares for the government ordered merger with Allied Irish Banks (AIB).

A statement on the EBS website said the losses were a result of an impairment charge of €285 million and loss and impairments on the transfer of assets to the National Asset Management Agency (Nama) of €392m.

The results also showed that operating profit at the building society was down 41 per cent on 2009 to €56m.

The building society’s total income was down 21 per cent in 2009 to €153m.

Despite acknowledging that it was a difficult year, EBS said it continued to demonstrate the strength of its commitment to customers “by continuing to deliver a range of compelling and competitive mortgage and savings products.”

A statement added:

The nature of competition in the mortgage and savings areas of the business was intense throughout 2010.

Last month, the government halted the proposed sale of EBS to investment group Cardinal Capital with Nama citing the bid as “not sufficiently attractive to the State”.

Soon after it was announced that EBS, which received €875 million in a government bailout last year, will be merged with AIB as part of a restructuting of the Irish banking system announced by minister for finance Michael Noonan last month.

AIB have said they expect EBS to remain a “standalone” institution despite the merger.