AIB to decide on buyback after AGM shareholder approval | Breaking News & Latest Ireland Updates

AIB to decide on buyback after AGM shareholder approval — AIB's board will decide over the coming week whether a proposed direct share buyback from the State should proceed after it was approved by shareholde...

AIB's board will decide over the coming week whether a proposed direct share buyback from the State should proceed after it was approved by shareholders today amid a drop in its share price since the plan was announced on March 5.

AIB announced the €1.2 billion buyback with the Government, a 12% shareholder, in early March as part of a boost to shareholder returns.

However, its share price has since fallen below the minimum price set for the buyback of €6.26 each due to a global stock market rout unleashed by US President Donald Trump's tariffs.

Shareholders approved the buyback proposal at AIB'S annual general meeting today, with 97% voting in favour. The bank's board has until May 8 to decide whether the plan is in the bank's best interests, AIB said in a trading update.

"We're obviously dealing with a high degree of uncertainty externally and quite volatile market conditions, but let's wait and see what happens over the coming days," AIB CEO Colin Hunt told reporters after the meeting.

The Government agreed in principle to the buyback proposal a month ago and said it could cut its shareholding in the bank to around 3% from 12% currently as it aims to exit the bank entirely this year.

A shelving of the buyback would delay the exit from a bank it effectively nationalised in 2010 when it pumped in £21 billion following a banking crash. The lower share price may also slow a separate gradual selling of shares.

AIB today reiterated its full-year guidance provided in March. In today's trading statement, it said its first-quarter net interest income had fallen in line with expectations and its core tier 1 capital ratio grew strongly to 16.8% from 15.1% three months earlier.

AIB said that new lending increased by 14% to €3.2 billion in the first three months of the year.

But its total income decreased by 9% mainly driven by lower interest rates.

AIB said its net interest income fell by 8% to €0.95 billion, down from €1.01 billion the same time last year. Its net interest margin (NIM) fell to 2.86% in the first three months of the year from 2.31% the same time last year.

It said it continues to expect NII for 2025 to be €3.6 billion given its "stable and granular deposit base", growth in its loan book and management of its structural hedge programme to reduce NII sensitivity.

Meanwhile, its core tier 1 capital ratio grew strongly to 16.8% from 15.1% three months earlier.

In today's trading update, AIB said its new mortgage lending in Ireland was up 14% to €0.9 billion, adding that it had a market share of 34% in March.

Personal lending in Ireland was up 7%, which AIB said reflected its larger customer base and an increase in consumer credit demand. It noted 86% of personal loan applications were completed online.

Meanwhile new lending to SMEs in Ireland remained relatively stable and in line with the first quarter of 2024, while AIB also said said that new lending in its Capital Markets business was in line with the same time last year.

The bank added that new lending in the UK performed well driven by corporate lending as it continues to focus on its chosen market sectors such as residential investment.

AIB said its non-performing loans of €2 billion were in line with December 2024 and represented about 2.8% of gross loans. It said its asset quality remains resilient and it continues to carefully manage its loan book.

AIB's chief executive Colin Hunt said the bank had a strong performance in the first quarter, having entered 2025 in a position of strength and with great momentum in the business.

"Gross loans grew to €71.4 billion in the first quarter and new lending increased by 14% to €3.2 billion, of which 38% was green," he said.

"Notwithstanding the uncertainty in the international external environment, we remain confident in our outlook for 2025 and beyond given our market-leading customer franchise, resilient revenues and strong funding and capital," the bank CEO said.

"The Irish economy continues to perform well and AIB plays a key role by supporting our customers and communities. We are implementing our proven strategy at pace and remain on course to deliver strong sustainable returns to our shareholders, both this year and over the medium-term," he added.

Additional reporting by Glenda Sheridan

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