Bank of Ireland (BIRG.I) has announced plans to increase earnings, accelerate shareholder returns, and cut costs over the next three years. This announcement follows the bank’s report of a lower-than-expected pretax profit for 2025. Bank of Ireland is one of the country’s leading financial institutions, providing a range of banking and financial services to personal and business customers. It operates primarily in Ireland and the United Kingdom.
Shares in Ireland’s largest lender fell by 3.5% in early trading, mirroring a broader decline in European bank stocks amid Middle East tensions. The bank aims to increase its net interest income to 3.85 billion euros in 2028, up from 3.37 billion euros last year. This growth is expected to be driven by increased lending and deposit acquisition within Ireland’s expanding economy, alongside ‘disciplined growth’ in its smaller international ventures.
To achieve these goals, Bank of Ireland intends to reduce its cost-income ratio to the mid-40% range from 52% last year. Chief Executive Officer Myles O’Grady highlighted the central role of artificial intelligence in the bank’s new three-year strategy. He stated that Ireland remains a highly attractive market, and the bank’s business model is well-positioned to benefit from this environment.
Despite these growth targets, the bank’s full-year pretax profit declined to 1.4 billion euros, down from 1.86 billion euros the previous year and below the 1.53 billion euros expected by analysts polled by LSEG SmartEstimate. Nevertheless, the bank plans to return 1.2 billion euros to shareholders through dividends and share buybacks, representing 100% of its earnings. The bank aims to distribute surplus capital annually, driving significant shareholder value creation.
