A strong second-half performance in life and pensions and buoyancy in the mortgage market helped to lift profits by 3 per cent to €365 million at Irish Life & Permanent last year.
The performance, ahead of market expectations, was driven by growth of 4 per cent in the firm's "core" businesses in the Republic and in the UK, which together generated an operating profit of €363.7 million.
Group chief executive Mr David Went described the performance as very satisfactory. Presenting a 2003 dividend of 51 cents, up 7 per cent on the previous year, Mr Went said he was very confident about 2004.
"There is now a strong momentum in each of our core businesses," he said, pointing to continuing solid growth in both banking and life operations in the year to date. He singled out this year's sales pipeline in pensions, wh ich is 80 per cent ahead of the same point in 2003.
Mr Went said the company had also made "great strides" in cutting costs last year but he went on to flag further cuts within banking operations, where staff numbers are expected to fall.
Mr Went said staff would leave Permanent TSB on a voluntary basis, with "natural wastage still quite high at clerical levels".
He declined to pinpoint a figure for the headcount reduction but said the bank would strip out €15 million in costs over the next 12 to 18 months.
The results also included an exceptional charge of €67.3 million relating to the disposal of the group's last US business - the Guarantee Reserve Life Assurance Company.
When this was placed against an exceptional gain of €144.3 million in 2002, the result was a 14 per cent decline in pre-tax profits, which came in at €309.6 million.
On a divisional basis, Irish Life retail sales were 39 per cent higher in the second half of last year than in the first six months, when business suffered amid concerns over investment markets.
Life assurance profits ended up at €189.7 million, 14 per cent lower than 2002 when business was boosted by a hefty contribution from Government-sponsored special savings incentive accounts.
Within life operations Mr Went said the firm was encouraged by an estimated 30 per cent penetration of the Personal Retirement Savings Account. He added, however, that "continued" Government support in promoting the area would be helpful.
The group's non-life associate company, Allianz-Irish Life, surpassed expectations by generating operating profits of €45.2 million, up 55 per cent on the back of better underwriting results and "more normal investment markets".
Banking profits, meanwhile, were 32 per cent higher at €129 million but the rise would have been limited to 7 per cent if the group had not made a €26 million once-off treasury gain by selling a portfolio of gilts.
Permanent TSB raised its new lending by 33 per cent to a record €6 billion, with new mortgage lending accounting for €3.8 billion of this.Shares in Irish Life and Permanent closed at €13.35, up two cents.
