Bank of Ireland : Debt Investor Presentation FY22 - March 2023 - 1 MB

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FY22

Debt Investor Presentation

31 December 2022

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Bank of Ireland

Overview

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Strong strategic progress and financial performance in 2022

FY22 financial performance

Strategic progress

accelerated

in 2022

Step change in

outlook reflected in new financial targets

10.6%

ROTE1 in

FY22

+11%

New customer relationships3 (+c.440k)

€350m

Distribution

for 20224

(FY21 €104m)

• Underlying PBT of €1.2bn
• Total income2 +11% y/y, reflecting higher net interest income and growth in fee income
• Strong cost discipline maintained; like-for-like costs lower, cost to income ratio5 reduced to 54%
• NPEs down 40%, NPE ratio 3.6% (2021: 5.5%)
• AUM +c.75% to c.€39bn, including €18.4bn following Davy acquisition
• c.240k new current accounts opened (+c.100% y/y); €11bn growth in Irish customer balances
• Bank of Ireland is the only privately held domestic bank in Ireland, following State sell down
• €7.8bn KBCI portfolio acquisition completed and portfolios safely migrated
• New annual financial targets for 2023-2025 post strategy update
• • c.15% ROTE1 (based off 14% CET1)
  • Cost to income ratio5< 50%
  • Build to c.40% ordinary dividend pay-out ratio6
  • Distribution of surplus capital to be considered annually

1. Basis of calculation for adjusted ROTE is set out on slide 57
2. Including share of associates and JVs; and including additional gains and valuation items
3. Includes c.240k of new current accounts, c.150k of new KBC customers and c.50k of new Davy clients
4. Subject to necessary approvals

5	Basis of calculation of cost to income ratio is set out on slide 58	2
6	c.40-60% ordinary dividend pay-out ratio in formal distribution policy provides flexibility. This pay-out ratio excludes distributions of surplus capital, which will be considered annually

Key business line highlights

	+64%
Irish Mortgages	y/y increase in
new mortgage
	drawdowns

Wealth and	20%
Insurance	NIAC market share
(2021 20%)

Business and	17%
New SME lending
Corporate Lending	volumes FY22
	(€3.2bn)

	+10% y/y
Retail UK	Retail UK FY22
	operating contribution
	(£325m)

• €3.9bn in new mortgage drawdowns; net book growth of 2% (ex NPE disposals)
• Market share increased to 28% (FY21 23%); 31% H2 2022
• Performance supported by enhanced digital and green offerings, while maintaining commercial discipline
• c.€39bn AUM (+c.75% y/y) - New Ireland Assurance (NIAC) €20.8bn, Davy €18.4bn
• AUM net inflows of €1.1bn in challenging markets
• Davy Private Client NPS +68; NIAC Wealth Advice & Distribution CES +70
• First year of net lending growth in Business Banking Ireland in over a decade
• Banking partner to 6 out of every 10 new FDI companies
• Disciplined approach to International Corporate lending, given macro uncertainties
• Cost to income ratio further improves to 43% (FY21 45%); (FY17 70%)
• Northridge new business lending +30% y/y
• Further modest deleveraging expected in UK in 2023, in line with strategy; pace will reflect ongoing pricing discipline and market dynamics

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Significant progress on our ESG Strategy

Commitment to green transition evidenced by tangible outcomes

Financial Wellbeing

at the heart of customer interactions

Improved colleague

engagement and

culture

1st

First Irish bank to have Science Based Targets validated by SBTi

> 4 million

Financial Wellbeing engagements

via mobile app1

68%

Colleague Engagement Index

(+5pts y/y)

c.€8bn

Sustainability-related finance

on balance sheet

UN co-lead

on UN Financial Health & Inclusion working group

76%

Colleague Culture Index

(+1pt y/y)

Inaugural Sustainability report; ESG upgrades from Sustainalytics, MSCI and S&P Global

1 Engagements in response to messages received in-app

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