2019 Interim Results Credit Presentation
Costs continue to reduce - net reduction €30m (3%)
€1.9bn
Operating expenses continue to reduce
€1,796m
€1,739m
€840m
€104m
2017
€113m
2018
€63m
2019
2020
Operating expenses Transformation Investment charge
Operating Expenses (including transformation investment charge)
c.€1.7bn
2021
2019 Interim Results Credit Presentation
Transformation of cost base continues
•
Expect operating expenses (including transformation investment
charge) in 2019 to be lower than 2018 and to reduce every year to
c.€1.7bn in 2021
Operating expenses (before levies and regulatory charges) of
€903m reduced by €30m net (3%) vs. H1 2018
Operating expenses of €840m - down €42m (4.8%)
Staff costs decreased by €19m (5%) vs. H1 2018 reflecting;
4% lower average staff numbers
Changing staff mix with fewer management layers, partially
offset by
Wage inflation of c.2.6% under the Group Career and Reward
framework
Other costs and depreciation reduced by €14m from process
efficiencies and strategic sourcing, partially offset by higher
depreciation from investment in technology
Includes cost reduction of €26m relating to exiting UK Cards
and ATMs
H1 2018
(€m)
H1 2019
(€m)
Total staff costs
442
414
•
- Staff costs
369
350
- Pension costs
73
64
•
Other costs¹
339
277
Depreciation¹
101
149
Operating Expenses
882
840
51
63
Operating Expenses (before levies and
933
903
regulatory charges)
.
€63m (46%) charged to the income statement
Levies and Regulatory charges
67
73
Total Operating Expenses
1,000
Average staff numbers
10,752
Cost-income ratio²
66%
976
10,368
65%
•
Levies and Regulatory charges of €73m
Expect levies and regulatory charges to total €115m - €120m for
FY 2019
Transformation Investment charge
Transformation Investment charge of €63m
• Total transformation investment in H1 2019 of €138m, in line with
expectations
1 The adoption of IFRS 16 resulted in a decrease in other costs of €42m and an increase in depreciation of €38m
2 See Slide 55 for calculation
Bank of Ireland
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