Pretax profits at Investec Ireland, the Irish subsidiary of international specialist banking group Investec, rose 9 per cent to €36 million in year to March 31st, despite a fall in revenues from its private banking operations.
Net revenues rose 6 per cent to €71 million and its loan book rose by 6 per cent to €702 million. Michael Cullen, chief executive with Investec Ireland, said the results were a solid performance against a challenging economic backdrop.
He said the capital markets unit had preformed well with a 40 per cent rise in revenues and the “Irish deposit market continued to be very competitive with funding costs remaining high”.
As a result Investec Ireland introduced new products in September last year to attract deposits.
Although traditionally a conservative lender the bank's loan to deposit ratio widened to 89 per cent compared with 75 per cent a year earlier.
Its subprime lender Nua Homeloans, which has been integrated with the companym, has ceased issuing new loans and is concentrating on managing its portfolio, the company said.
Mr Cullen said the bank’s private banking business had been hit by the decline in Irish and global economic conditions over the year which had seen unprecedented destruction of wealth.
“As a result activity levels in our private banking business are greatly reduced. Overall gross revenues are down 19 per cent on last year.”
He added that the collapse of the Irish property market had impacted on its structured property finance business leading to “increased levels of stress on some parts of the loan book and as a result have seen impairment provisions rise.”
The bank did not specify what these impairment provisions are.
Its parent Investec today lowered its final dividend payment to 5 pence to bring the full-year dividend to 13 pence, a fall of 48 per cent over the year.
