The Irish property market has bottomed out. This is not some seemingly crack-pot prediction from a commentator, but the assertion of Richie Boucher, head of Bank of Ireland.
"We think the property market is beginning to stabilise - in particular in urban areas," he told the Sunday Independent.
"This time last year many of those who had mortgage approval from us were not taking up the mortgages - as they were still nervous about buying. Now, estate agents are saying there are more buyers than sellers in urban areas."
Appointed in February 2009 as group chief exec of Bank of Ireland, Boucher made the statements as he presented the bank's interim results last Friday.
Unfortunately the bank is still losing heavily, with a 1.25 billion Euro loss in the first six months of this year. However, with most of this exorbitant loss absorbed by the 941 million set aside to cover loan losses, the bank expects to return to profit in 2014.
However, the report also said that these hopes could easily be dashed by prolonged weakness in the global economy.
"Reduced growth prospects in Ireland's trading partners increases the likelihood of prolonging the ongoing downturn in economic conditions which could further adversely impact the bank's results, financial condition and prospects," said the report
The report would also make depressing reading for staff at the bank as it came right out and said that more job cuts are on the horizon.
"Our balance sheet is reducing by a third, so our costs must be realigned with that," said Boucher. "As we restructure the group, regrettably the number of people that we employ will reduce."
This will be on top of the 3700 staff laid off by the bank since it hit troubled waters in early 2009. According to Boucher there are still no plans to close any of its 254 branches, but it is feared that these plans could easily be changed if the banks plans to increase revenue by selling new products don't pan out as hoped.
- Tuesday 14 August 2012