Bank of Ireland Plc Chief Executive Officer Richie Boucher said the nation’s largest lender by assets has enough capital to absorb bad loan losses.
Every financial gauge for the Dublin-based lender, including lending margins, costs, loan losses and deposits are “moving in the right direction,” Boucher said at an event in Dublin today. Momentum on all measures has continued “strongly” from last year into 2013, he said.
“Do we have the capital strength to deal with loan losses and support our lending activities ambitions?” Boucher said, adding he’s confident loan losses are declining. “We definitely do.”
Irish banks, which have required a 64 billion euro ($83 billion) bailout in the past four years, may avoid another state cash call as they face stress tests later this year, according to five of seven analysts and economists surveyed by Bloomberg News earlier this month. Taxpayers injected 4.8 billion euros into Bank of Ireland since 2009.
The lender has also generated 9 billion euros of private capital during this period, Boucher said. A July 2011 share sale resulted in five investors including U.S. billionaire Wilbur Ross’s WL Ross & Co. LLC and Toronoto-based Fairfax Holdings Ltd. taking an almost 35 percent stake in the lender.
Bank of Ireland shares have risen 89 percent since then to 18.9 euro cents as of 12:19 p.m. in Dublin trading, giving the company a market value of 5.6 billion euros.
Investment “did not come from the private sector because they felt sorry for us,” said Boucher, 54.. “It came from people who have closely studied Ireland and the Bank of Ireland. They believe in the recovery of Ireland and they believe in the bank’s ability to support that recovery.”