PTSB said its revenues grew 10 per cent in the first quarter, with ongoing mortgage growth helped by a jump in business banking lending and a doubling of consumer lending after an overhaul of its personal loans offering.
The bank’s net interest margin – the difference between the average rates at which it funds itself and lends to customers – also expanded by 0.1 of a percentage point to 2.13 per cent, according a trading update issued on Friday before its annual general meeting (AGM).
The increase in revenue also served to lower PTSB’s cost-to-income ratio to 72 per cent from 75 per cent for last year, and leaves it on track, it said, to fall below 70 for the year as a whole. Still, that remains well above the typical retail bank target of about 50 per cent.
The bank’s share of a growing mortgage market amounted to 19 per cent in the quarter, slightly below its 20 per cent slice of activity a year earlier. Home loans accounted for 93 per cent of its portfolio at the end of last year.
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Business lending surged 18 per cent on year-ago period to €119 million, chief financial officer Barry D’Arcy told reporters after the AGM. New personal term lending soared 105 per cent, albeit off a low base, to €61 million. Total gross loans rose 3 per cent to €22.7 billion.
D’Arcy said the bank has not yet detected any changes in customer behaviour on any of savings, borrowing or loan repayments fronts since the Middle East conflict erupted and sent energy costs soaring.
“That’s something that we’ve been monitoring incredibly closely. We’re probably hypersensitive to it,” he said.
“We’re not seeing anything at this moment in time to give us any concern. I think the rude health of the Irish economy was underpinning us coming into this.”
Vienna-based Bawag emerged last month as the winner of the sale process for PTSB, agreeing to buy the State-controlled lender for almost €1.62 billion.
While the price, amounting to a 20 per cent discount to PTSB’s reported end-2025 net assets, has been criticised by some analysts and investors, group chairwoman Julie O’Neill told the AGM that it was the result of a “very robust and competitive sales process”. She added that the board is “confident it offers the best value for shareholders”.
Piotr Skoczylas, director of PTSB investor Scotchstone Capital Fund, which has pursued a number of court actions over the years challenging the State’s 2011 bailout of the group, told the meeting that he had launched a fresh case.
Skoczylas wants the takeover to be subject to two shareholder meetings, with one excluding the Government, which owns 57 per cent of PTSB.
“The proposed Bawag acquisition of PTSB is a bad deal for PTSB shareholders,” he said, adding that the price “hands Bawag the economic upside”.
Bawag said in a transaction agreement document that it plans to carry out a “detailed review” of product lines it has on offer in Austria, Germany and the Netherlands, with a view to rolling them out in Ireland. This will include household energy-efficiency loans, small-business and self-employed banking products, investment brokerage services, and the financing of residential and commercial property development and investment, according to the document.
Executives from the Austrian banking group have also indicated they may move PTSB into commercial property, public-sector lending and potentially corporate lending. This has underpinned hopes that the smallest of the remaining three Irish banks will become a real challenger to its larger peers.
