AIB outlines targets ahead of IPO

The bank says it's ready for a stock market flotation...

AIB has outlined the targets that it hopes to hit in the coming years as it prepares to float on the stock exchange.

In a statement to the stock exchange, it set out its medium-term financial targets for the next three to five years.

These include securing a "strong and stable" NIM (net interest margin - the difference between its interest rate charged, and interest it pays on its loans) rate of more than 2.40%. In 2016 this measure was 2.23%.

It hopes to achieve a cost income ratio (operating costs divided by operating income) of less than 50% by the end of 2019.

The Irish bank aims to hit a CET1 target of 13% (a measure introduced to measure bank's financial stability after the 2008 financial crisis) - it was 15.3% last year.

AIB also wants to secure returns on tangible equity of more than 10% (a measure of net earnings relative to common shareholders' equity).

It also states, "the Bank has proposed a dividend of €250m, the first dividend payment to ordinary shareholders since H1 2008 and the first step towards a normalised dividend payout ratio."

Plans to sell in 2016 were pushed back as the bank faced unfavourable market conditions.

"The bank is now ready for an IPO, when market conditions permit and the Minister decides. With a market leading franchise, strong customer focus and investment in digital, AIB Group is well placed to continue to support our customers and the growing Irish economy,"  Bernard Byrne, CEO said in a statement accompanying its 2016 full year results last week.