Bank Of Ireland Results Look Broadly Stable; Not Likely A Spread Mover

Rating: Baa2[P]/BB+/BBB-[P] EUR Spreads Muted

Stable set of results results on stable and broadly in line revenues and slight improvements in CET1, asset quality along with upgraded guidance.

• H1 revenues flat YoY and in line with consensus; NII exactly flat YoY and matches the Q1 indication that interest income had been steady over recent quarters. Net other income also flat. Cost-income saw a slight increase to 44% vs. 42% in H123.
• Fully loaded CET1 of 15.4% up from 14.7% at Q1 and 14.3% at FY23; supported by 170bps of organic capgen over the half and offset by 70bps for the interim dividend set at EUR 352mn or 40% of H1 profit.
• NPE ratio sat at 2.9% compared to 3.2% at Q1 and 3.1% at FY23 with total coverage maintained at 1.5% of gross loans. Net credit impairment charge of EUR 50mn or 12bps annualised described as better-than-expected, feeding through to a guidance upgrade.
• Guidance upgraded; NII seen around EUR 3.55bn at the higher end of the prior “3-4% lower than the Q4 2023 annualised run rate of €3.65 billion”, levies seen at EUR 125-130mn from prior guidance of EUR 160-165mn, net credit impairment of ~20bps from prior guidance of low 30sbps.