CUSTOMER deposits to Bank of Ireland’s retail business in the UK fell by £3.5 billion last year.
The lender’s annual report recorded a 22 per cent decline in UK deposits from £15.8bn in 2021 to £12.3bn for 2022, in the first full year of trading since it slashed its banking network in Northern Ireland from 28 branches to just 13.
Bank of Ireland’s Retail UK division includes its Northern Ireland branch network, its UK business banking operation and its UK residential mortgage business, which accounts for 21.3 per cent of the group’s total loan book.
It also encompasses its finance business Northridge and its joint venture with the Post Office, which offers financial services including savings, loans, credit cards and mortgages to around 2.4 million customers in the UK.
A separate partnership with the AA offers financial products to around 90,000 UK customers.
Bank of Ireland’s annual report for 2022 showed the group recorded an overall underlying profit before tax of €1.2bn (£1.07bn) for 2022, with its customer base growing by 11 per cent.
That was boosted by customers moving from Ulster Bank and KBC Bank Ireland, as those lenders wound down their operations in the Republic. It led to a €6bn (£5.3bn) uplift in customer deposits for Bank of Ireland’s Retail Ireland division.
Last year also saw Bank of Ireland acquire portfolios from Davy Stockbrokers and KBC Bank Ireland.
But the same report showed a more challenging environment for its Retail UK business, where customer deposits were down by £3.5bn in 2022.
Loans and advances to Retail UK customers also fell by £3.8bn to £18.2bn last year – a decline of 17 per cent.
The overall operating income for its Retail UK business increased by £20m to £569m in 2022. But impairments left its underlying contribution to the group at £261m for 2022, down by 27 per cent on 2021.
The bank said an impairment loss of £92 million for Retail UK reflected “a return to normalised impairment charges and a more uncertain economic outlook”.
It also incorporated a charge for the sale of non-performing residential mortgages in the second half of 2022
Elsewhere, Bank of Ireland’s decision to close 15 branches in the north in 2021 appeared to drive more customers to its Banking 365 app.
It said 139,000 customers accessed the app in 2022, with an average of 642,000 logins per week, up from 450,000 in 2021.
The annual report comes just weeks after Bank of Ireland UK chief executive Ian McLaughlin announced he will leave the group this year to take over as CEO of subprime lender Provident Financial.
