Bank of Ireland chief executive Mr Maurice Keane believes the Irish economy will return to solid growth in the second half of next year.
By adopting such a positive line, Mr Keane has in effect aligned himself with the views of his treasury economist, Dr Dan McLaughlin, and implicitly rejected the negative analysis from Mr Robbie Kelleher, economist with the bank's Davy stockbroking subsidiary. On the domestic economy, he said the bank's experience was that there was still solid demand from consumers.
"There may have been a lot of redundancies but a lot more people are still employed now than 12 months ago. There is still a lot of demand. We will do €2 billion [£1.6 billion] in mortgages this year. There is still a high level of business on the retail side, but there will be less growth on the business side," Mr Keane said.
Dr McLaughlin is one of the most bullish forecasters on the Irish economy and has forecast 5 per cent growth next year, while Mr Kelleher has adopted a bearish forecast of just 1 per cent.
Yesterday, Mr Keane said he had "no quarrel" with Dr McLaughlin's assessment. "The American economy has been declining since the second quarter of 2001 and it looked like it had bottomed out in August. But then came the tragic events of September 11th. Consumer confidence has been falling, but yesterday's sales figures from the US give a different sign," Mr Keane said. "Interest rates in the US are low, inflation is low, unemployment is low and there seems to be a serious determination to stimulate the economy."
Finance director Mr Paul Dalton said that since the end of the half-year on September 30th, all statistics have shown there continues to be strong upward momentum.
"The rate of growth might be slower but it's growth nonetheless. There is no complete standstill. Our lending and deposits are greater than they were on September 30th, we've had very good life and pension sales and compared with September 30th, asset values are higher.
"The past six weeks have not led us to take a more gloomy view of the prospects. We are optimistic of a satisfactory outcome for the full year," he said.
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