#1Pending#2Pending#3Pending#4Pending#5Pending#6Pending#7Pending#8Pending#9Pending#10Pending#11Pending#12Capturing all tactical and strategic opportunities to further reduce our cost base Consistent Costs reduced by 10% vs. H2 2017 Costs have reduced during each of the past five reporting periods €964m Broad-based Cost reduction broad based across staff and non-staff costs since 2017 Bank of Ireland 2020 Interim Results Efficient €262m in gross cost savings since FY 2017 created capacity to absorb investment in our people and infrastructure €933m (5%) Change €919m demand/ €903m €882m €872m (13%) efficiencies €26m €67m Sourcing strategically €156m Simplifying the organisation H217 H118 H218 H119 H219 H120 Staff Non-staff Ways of Working €13m €1.9bn €1.9bn €1.85bn €1.79bn Future focus <€1.65bn • • • 2021 costs now expected to be below previous guidance of €1.65bn Review underway to further reduce costs beyond 2021: Continued investment in digital capabilities Simplifying and automating customer journeys Additional investment in business model restructuring Enhanced property footprint, supported by modern and agile ways of working Guidance update to be provided at FY 2020 2017 2018 2019 2020 2021 Beyond 2021 Bank of Ireland 12#13Pending#14Pending#15Group CFO Myles O'Grady Bank of Ireland 2020 Interim Results Bank of Ireland 15#16Pending#17Pending#18Stable net interest income €1,069m 285bps (17bps) Net interest income¹ / NIM €1,081m 280bps (21bps) H1 2019 H2 2019 H1 2020 Loan asset spread² Liquid asset spread² 2.14% (6bps) NIM movement (4bps) (2bps) Bank of Ireland 2020 Interim Results €1,079m 278bps (24bps) Stable net interest income / NIM 2.02% Net interest income benefitting from loan book growth since 2017 and reduced liability costs offsetting lower structural hedge income and UK competitive pressures NIM 2.02% is 12bps lower than FY 2019 reflecting: - - Growth in liquid assets Impact of low rate environment on structural hedge Competitive pressure in the UK mortgage market Strong commercial pricing discipline Q2 exit NIM 1.97% Outlook . FY 2020 NIM to be c.1.95% primarily reflecting: - Lower new lending volumes Growth in liquid assets Impact of low rate environment on structural hedge Net interest income in 2020 to be c.5% lower than 2019 2.02% FY 2019 Liquid asset growth Structural hedge UK competitive pressures H1 2020 1 Excludes IFRS income classifications which are included in NIM calculation 2 Spread Loan asset yield or Liquid asset (excl. NAMA bonds) yield less Group's average cost of funds Bank of Ireland 18#19Pending#20Pending#21Pending#22Pending#23Pending#24Pending#25Pending#26Pending#27Pending#28Pending#29NPE ratio increase to 5.8% 6.3% 4.4% €5.0bn €3.5bn NPE movements €0.5bn €0.6bn 5.8% • €4.6bn Dec 18 Dec 19 Inflows Definition of Default Jun 20 Mortgages (ROI) Non-property SME ⚫ NPE ratio NPEs by portfolio €1.5bn €1.6bn €0.9bn and corporate €1.1bn Property and €0.6bn construction €1.1bn Mortgages (UK) €0.5bn €0.6bn Consumer €0.1bn (ROI & UK) €0.1bn Dec 19 Jun 20 1 See slide 45 Bank of Ireland 2020 Interim Results Non-performing exposures • • NPE ratio increased by 140bps to 5.8% €0.6bn inflows primarily from credit migration in Non-property SME and corporate, and Property and construction portfolios Implementation of new Definition of Default regulatory framework increased NPEs by €0.5bn No NPE transactions completed in H1 2020 due to market conditions Group NPE coverage ratio increased by 10% to 47% at Jun 2020 Jun 20 Coverage Ratio . 29% 73% 42% 21% Outlook Proven track record of working with customers to implement sustainable solutions; significantly below industry average for arrears management¹ NPE transactions dependent on market conditions 29 29 Bank of Ireland#30Strong capital position 40bps (65bps) RWAS €49.9bn 45bps 13.8% Fully loaded CET1 ratio Impairment EL offset (190bps) 90bps RWA reduction 35bps Net impact (65bps) Bank of Ireland 2020 Interim Results (15bps) (15bps) (60bps) 40bps 10bps RWAS €47.6bn (20bps) Regulatory capital demand 13.6% Dec 19 Pre-impairment organic capital generation¹ 2019 Dividend Credit deterioration Loan Growth/ RWA² Transformation investment Definition of Default / IRB models SME supporting factor Other / Pension Jun 20 Headroom to 2020 CET1 regulatory capital requirements 2020 Regulatory Requirements (excl. P2G) 13.6% Jun-20 Fully Loaded CET1 Ratio 9.27% 14.9% Jun-20 Regulatory CET1 Ratio c.560bps headroom Strong capital position • Fully loaded CET1 ratio +10bps since Q1 2020 Regulatory CET1 ratio +50bps since Q1 2020 2% reduction in RWA density Outlook 2020 regulatory CET1 ratio to remain above 13.5% • No dividend deduction assumed for 2020 1 Pre-impairment organic capital generation primarily consists of attributable profit excluding impairment and movements in regulatory deductions 2 Loan Growth / RWA movements from net loan growth, changes in asset quality and book mix and movements in other RWAS Bank of Ireland 30#31Outlook Profitability Asset Quality • • • 2020 gross new lending volumes expected to be c.70% of 2019 volumes Net interest income in 2020 to be c.5% lower than 2019 2020 business income to be 20%-30% lower than 2019 Costs will continue to reduce: - 2020 costs to be lower than 2019 2021 costs to be below previous guidance of €1.65bn While we expect economic recovery commencing in H2 2020, COVID-19 and Brexit are ongoing uncertainties Subject to no further deterioration in the economic environment or outlook, 2020 impairment charge expected to be in a range of c.€1.1bn to €1.3bn Bank of Ireland 2020 Interim Results Capital • 2020 regulatory CET1 ratio to remain above 13.5% No dividend deduction assumed for 2020 Longer term impacts of COVID-19 on the economy and the Group's financial performance remain uncertain, our medium term targets should therefore no longer be considered current in these circumstances Bank of Ireland 31#32Summary and conclusion Bank of Ireland 2020 Interim Results Trading outlook While uncertainties remain, accelerated economic activity is supporting improved outlook for 2020 lending and income vs. Q1 outlook Capital Strong capital position with fully loaded CET1 ratio of 13.6%, regulatory CET1 ratio 14.9% Asset quality Proven track record, over a sustained period, of working with customers to find sustainable solutions Transformation Efficiency UK retail Multi-year programme delivery against milestones; delivering agile, digitised solutions for customers and creating cost efficiencies All tactical and strategic opportunities being captured to further reduce our cost base; 2021 costs to be below previous guidance of €1.65bn Further restructuring required to improve returns; strategic review of Northern Ireland retail business recently commenced Bank of Ireland 32 32#33Pending#34Pending#35Pending#36Pending#37Pending#38Pending#39Pending#40Pending#41Non-performing exposures by portfolio Bank of Ireland 2020 Interim Results Advances Non-performing Non-performing Impairment Composition (Jun 20) (€bn) exposures (€bn) exposures as % of advances loss allowance Impairment loss allowance as % of (€bn) non-performing exposures Residential Mortgages 44.4 2.2 5.0% 0.6 26% - Republic of Ireland 22.9 1.6 6.9% 0.4 29% - UK 21.4 0.6 3.0% 0.1 21% Non-property SME and corporate 20.7 1.1 5.4% 0.8 73% - Republic of Ireland SME 7.1 0.6 9.1% 0.4 66% - UK SME 1.7 0.1 6.8% 0.1 57% - Corporate 11.9 0.4 3.1% 0.3 89% Property and construction 8.2 1.1 13.3% 0.5 42% - Investment 7.4 1.1 14.4% 0.4 39% - Development 0.8 0.0 4.0% 0.0 118% Consumer 5.3 0.1 2.4% 0.3 208% Total loans and advances to customers 78.5 4.6 5.8% 2.1 47% Non-performing Advances Composition (Dec 19) (€bn) exposures (€bn) Non-performing exposures as % of advances Residential Mortgages 46.3 1.9 - Republic of Ireland 23.0 1.5 - UK 23.2 0.5 Non-property SME and corporate 20.4 0.9 - Republic of Ireland SME 7.3 0.5 - UK SME 1.7 0.1 - Corporate 11.4 0.2 Property and construction 8.1 0.6 - Investment 7.2 0.6 - Development 0.9 0.0 25525-2669 4.2% Impairment loss allowance (€bn) 0.4 Impairment loss allowance as % of non-performing exposures 22% 6.3% 0.4 25% 2.1% 0.1 13% 4.3% 0.5 55% 7.5% 0.3 54% 6.3% 0.0 46% 2.0% 0.1 60% 7.3% 0.2 39% 7.7% 0.2 37% 3.8% 0.0 64% Consumer 5.7 0.1 1.7% 0.2 159% Total loans and advances to customers 80.5 3.5 4.4% 1.3 37% Bank of Ireland 41#42Pending#43Pending#44Pending#45ROI Mortgages Continued proactive arrears management >90 days arrears¹ Industry Average Industry Average 15.7% Bank of Ireland Bank of Ireland 6.5% 3.8% 1.9% Owner Occupier Owner Occupier Buy to let Buy to let >720 days arrears¹ Industry Average Industry Average 12.1% Bank of Ireland Bank of Ireland 4.3% 1.0% 2.1% Owner Occupier Owner Occupier Buy to let Buy to let 1 As at March 2020, based on number of accounts, industry average excluding BOI Bank of Ireland 2020 Interim Results >90 days arrears . Bank of Ireland is significantly below the industry average for both Owner Occupier (29% of industry average) and Buy to Let (24% of industry average) >720 days arrears • Bank of Ireland is significantly below the industry average for both Owner Occupier (23% of industry average) and Buy to Let (17% of industry average) 45 45 Bank of Ireland#46Pending#47Pending#48Pending#49Pending#50Pending#51Pending#52Pending#53Pending#54Pending#55Forward-Looking statement Bank of Ireland 2020 Interim Results This document contains forward-looking statements with respect to certain of the Bank of Ireland Group plc (the 'Company' or 'BOIG plc') and its subsidiaries' (collectively the 'Group' or 'BOIG plc Group') plans and its current goals and expectations relating to its future financial condition and performance, the markets in which it operates and its future capital requirements. These forward-looking statements often can be identified by the fact that they do not relate only to historical or current facts. Generally, but not always, words such as 'may,' 'could,' 'should,' 'will,' 'expect,' 'intend,' 'estimate,' 'anticipate,' 'assume,' 'believe,' 'plan,' 'seek,' 'continue,' 'target,' 'goal,' 'would,' or their negative variations or similar expressions identify forward-looking statements, but their absence does not mean that a statement is not forward-looking. Examples of forward-looking statements include, among others: statements regarding the Group's near term and longer term future capital requirements and ratios, level of ownership by the Irish Government, loan to deposit ratios, expected impairment charges, the level of the Group's assets, the Group's financial position, future income, business strategy, projected costs, margins, future payment of dividends, the implementation of changes in respect of certain of the Group's pension schemes, estimates of capital expenditures, discussions with Irish, United Kingdom, European and other regulators and plans and objectives for future operations. Such forward-looking statements are inherently subject to risks and uncertainties, and hence actual results may differ materially from those expressed or implied by such forward-looking statements. Investors should read 'Principal Risks and Uncertainties' in the Group's Interim Report for the 6 months ended 30 June 2020 beginning on page 28 and also the discussion on risk in the Group's Annual Report for the year ended 31 December 2019. Nothing in this document should be considered to be a forecast of future profitability or financial position of the Group and none of the information in this document is or is intended to be a profit forecast or profit estimate. Any forward-looking statement speaks only as at the date it is made. The Group does not undertake to release publicly any revision to these forward-looking statements to reflect events, circumstances or unanticipated events occurring after the date hereof. Bank of Ireland 55#56Contact Details For further information please contact: Group Chief Financial Officer Myles O'Grady Investor Relations Darach O'Leary tel: +353 76 624 3291 tel: +353 76 624 4711 Eoin Veale tel: +353 76 624 1873 Philip O'Sullivan tel: +353 76 623 5328 tel: +353 76 624 9051 Catriona Hickey Capital Management Lorraine Smyth Alan Elliott Alan McNamara tel: +353 76 624 8409 tel: +353 76 624 4371 tel: +353 76 624 8725 Group Communications Damien Garvey tel: +353 76 624 6716 Investor Relations website www.bankofireland.com/investor [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] Bank of Ireland 2020 Interim Results Bank of Ireland 56#57Pending#58Pending#59Pending#60Pending