Belfast Telegraph

Northern upbeat in spite of losses

By Margaret Canning

Northern Bank has reported a pre-tax loss of £16.7m in its 2010 half year results.

The bank said the loss represented a "substantial improvement" on losses of £75m for the same period last year.

But the institution - owned by Danish banking giant Danske Bank - said economic conditions were still "challenging".

Operating profit before money set aside for bad loans was £25.5m. But that sum was cancelled out by bad loans of £42.2m.

Northern Bank chief executive Gerry Mallon said: "I am pleased with our core business performance, which remains very resilient.

"However, the Northern Ireland economy is still very fragile and the level of impairment charges serves to remind us of this. Despite this, the charges are substantially lower than this time last year, having previously fallen for four consecutive quarters.

"We remain strong and healthy and well positioned for future growth."

He said the bank wanted to boost its mortgage and business customer count despite operating "in a challenging, highly competitive industry and in a low interest rate environment".

Parent Danske also released its first half results yesterday, with pre-tax profits of £200m.

Peter Straarup, chairman of Danske's executive board, said: "Generally, things are moving in the right direction. Impairment charges have seen a downward trend for six quarters in a row and are down 50% compared with the level in the first half of 2009.

"In several of the group's markets, charges are approaching normal levels. This is the case in Finland, Sweden, Norway and the Baltic countries.

"At the same time, the group's banking activities show robust earnings. In view of the macroeconomic development, we look at the rest of 2010 with cautious optimism."

National Irish Bank - Northern's sister institution in the Republic - reported a pre-tax loss of €341m (£283m) for January to June, a loss similar to that experienced by the bank during the same period last year.

Last week Ulster Bank announced losses of £314m, while First Trust reported losses of £52m, with Bank of Ireland set to announce its results today.