PTSB reports 10% increase in Q1 net interest income

May 9, 2024

PTSB said today it had recorded a strong financial performance in the first quarter of 2024, including an increase in net interest income and a doubling of business lending.

In an interim management statement today, the bank said its mortgage market share during the three months from January to March declined slightly from the fourth quarter of 2023 as it continues to be impacted by the reduced switcher market.

PTSB’s net interest income increased by 10% year-on-year, with gross interest income increasing by 37% due to higher interest rates and the growth in average interest earning assets.

The bank said this was partly offset by a higher cost of funds due to the growth in deposit volumes – mainly in higher interest bearing retail deposits.

It added that net fees and commission income performance is in line with the same time last year as the bank continues to support its larger customer base after the exit of Ulster Bank and KBC Bank Ireland from the Irish market.

PTSB said that lending across term and business banking remains strong, while the addition of the asset finance business line further diversifies its product offering and gives customers more choice.

The bank said the mortgage market is set to increase by about 6% from €12.1 billion in 2023 to about €12.8 billion this year.

It noted that its performance in the first quarter followed the broad trajectory of the second half of last year with a noticeably reduced market for switchers after PTSB had “over-performed” during the first half of 2023 and intense competition for first time buyers.

As a result, the bank’s market share of new mortgage drawdowns in the first three months of 2024 eased to 13.4% from 15.4% at the end of December.

The lender noted that 73% of new mortgage drawdowns in the first quarter were to fixed rate products, while its “green” product offering accounted for 32% of total new mortgage drawdowns.

Its total performing loan book of €20.8 billion on 31 March was 1% lower than December 2023, as new lending volumes are outpaced by contractual repayments and redemptions.

PTSB said its asset quality remains strong with non-performing loans of €0.7 billion at the end of March, in line with balances at the end of last year.

Meanwhile, customer deposits of €23.3 billion are up €0.3 billion compared to the end of December, mainly due to a 2% increase in retail deposit balances to €12.6 billion.

Current accounts have also grown, by 1% to €9.4 billion.

PTSB’s chief executive Eamonn Crowley said the bank’s strong capital and liquidity positions, continued growth in its customer deposit base and its refreshed brand positioning support its ability to grow and diversify the business across both Retail and Business Banking through this year and beyond.

“Evidence of this is our recent move into the retrofitting market, being the first lender to offer the Government backed Home Energy Upgrade Loan scheme and offer low-cost funding to customers to enable them to retrofit their homes. In addition, the bank also recently announced its participation in the SBCI Growth and Sustainability loan scheme further supporting Business Banking customers grow and transition to a low carbon economy,” the CEO said.

“We have confidence that the acquisitions and investments we have made are putting us in a strong position to continue to further grow and diversify our business and deliver sustainable returns for our shareholders over time,” he added.

Article Source: PTSB reports 10% increase in Q1 net interest income

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