AIB makes pre-tax profit of €291m after big loss in 2020

Last month the bank announced it was closing eight branches in Northern Ireland

AIB made a pre-tax profit of €291m (£248m) in the first half of 2021, compared to a €909m (£774m) loss in the same period of 2020.

Its UK division, which includes its Northern Ireland business, had a pre-tax profit of £47m.

In July the bank announced it was closing eight branches in Northern Ireland, reducing its NI branch network to just seven.

The bank is also withdrawing from small business lending in Great Britain.

It is to focus on larger business customers.

The improved performance in the first half of 2021 largely reflects changes in loan loss provisions.

These provisions are money a bank must put aside to cover loans which they assess are unlikely to be repaid in full.

• AIB joins UK government's coronavirus loans scheme

• AIB agrees to purchase Ulster Bank's Irish loans

In the first half of 2020 it had set aside more than €1bn (£851m) in provisions, but in the same period this year it made no new provisions and "wrote back" €100m (£85m) of loans which it now assesses will be repaid.

Many banks have reversed loan loss provisions as government interventions have minimised the economic damage from the pandemic.

Chief executive Colin Hunt gave an upbeat assessment for the rest of the year.

"While remaining alert to the economic uncertainties, I look forward to the remainder of 2021 and beyond with confidence, focused on our newly revised medium-term targets," he said.