20 24

Bank of Ireland Group plc Interim Report (for the six months ended 30 June 2024)

'The Group had an excellent performance in the first half of 2024, reporting a profit of €1.1 billion, up 5%. We're meeting or beating all of the targets we have set. This performance – underpinned by growth in our loan book and wealth assets, higher income and robust capital generation – supports upgraded earnings guidance for the year.'

Myles O'Grady Group Chief Executive

Inside this report

Key performance highlights	3
Chief Executive's review	4
Operating and financial review	7
Summary consolidated income statement on an underlying basis	7
Summary consolidated balance sheet	13
Divisional review	17
Principal Risks and Uncertainties	26
Asset quality	27
Capital adequacy risk	36
Statement of Directors' responsibilities	39
Independent review report	40
Consolidated interim financial statements
and notes (unaudited)	41
Other information	113

View this report online

The Interim Report and other information in relation to Bank of Ireland is available on the Investors page of our website at: www.bankofireland.com

The Group's forward-looking statement can be found on page 114.

Key performance highlights

Strong strategic and financial performance through our business model

¹New Irish bank channel customer relationships as a proportion of total relationships 12 months previously. ²The Group's financial results are presented on an underlying basis. Underlying excludes non-core items which are those items that the Group believes obscure the underlying performance trends in the business. See non-core table on page 12 for further details. For calculation of underlying cost / income ratio (CIR) see page 120.

³Return on Tangible Equity (adjusted) is an alternative performance measure, for calculation see page 119. ⁴In accordance with ECB guidance and EBA Q&A 2023_6887, no interim profits have been recognised under Article 26(2) of the Capital Requirements Regulation. The interim capital ratios for June 2024 have therefore been presented excluding the benefit of H1 interim profits. Inclusion of H1 interim profits results in a CET1 Ratio of 15.4%.

Further information on measures referred to in our key performance highlights can be found in alternative performance measures on page 115.

Chief Executive's review

The Group had an excellent performance in the first half of 2024, reporting a profit of €1.1 billion, up 5%. We're meeting or beating all of the targets we have set. This performance – underpinned by growth in our loan book and wealth assets, higher income and robust capital generation – supports upgraded earnings guidance for the year. We are now in the second year of a three year strategic cycle, and making tangible progress building stronger customer relationships, a simpler business, and a more sustainable company. With a supportive macroeconomic backdrop, our differentiated business model operating in highly attractive markets is expected to continue to perform well in the second half of the year. Reflecting this business performance, and consistent with our plans for a progressive dividend, we are pleased to announce an interim dividend of €352 million, equating to 35 cents per ordinary share.

Our performance in H1 is underpinned by loan book growth and stronger capital generation than we expected at the start of the year. This reflects the successful execution of our strategy, commercial delivery across all our businesses, the optimisation of our capital, and the supportive interest rate and macroeconomic environment.

The domestic Irish economy, which accounts for c.75% of Group profits, is most relevant for Bank of Ireland. Here, our businesses performed very well, most notably Irish mortgages and Wealth and Insurance, with our Irish SME and Corporate business also growing.

Our UK business also continued to deliver, with loan book growth resuming after several years of planned deleveraging. We have reaffirmed our UK strategy, focusing on higher return mortgage lending and our Northern Ireland full-service franchise, with the business positioned to continue to deliver sustainable returns.

We remain cautious on our international corporate and property portfolio, with these books modestly lower.

Key financial highlights in the first half include:

;

profit before tax of €1.1 billion;
a cost-income ratio of 44%¹
an adjusted RoTE of 18.9%;
lower NPE ratio of 2.9%, down 20 bps from FY23 and now below the milestone level of 3%;
net organic capital generation of 170bps;
a fully loaded CET1 capital ratio of 15.4% including H1 unaudited profits and a deduction for an interim ordinary dividend (31 December 2023: 14.3%); and
the commencement of interim distributions, with an ordinary dividend of 35 cents per share.

The Group is now at the mid-point of its three year strategic cycle. We are making tangible progress across each of our three strategic pillars – building stronger customer relationships, a simpler business and a more sustainable company. We are also working hard to future-proof our business model for the medium term and to strengthen our culture. Our progress is evidenced in the growth in customer loans, wealth assets under management (AUM) and improved customer satisfaction. Our focus is on continuing to invest for the future as we continue to deliver for customers, colleagues, shareholders and society.

¹The Group's financial results are presented on an underlying basis. Underlying excludes non-core items which are those items that the Group believes obscure the underlying performance trends in the business.

Delivering on our Strategic Pillars

The first half of 2024 saw excellent execution across all of our strategic pillars, including:

Stronger Relationships

Achieving better customer outcomes was reflected in our highest ever RNPS of +12 points, 7 points higher vs 2023. This progress has been supported by a range of investments including inbranch services and ATMs, contact centre technology, and fraud protection and prevention. The number of new customers onboarded in H1 increased +2%. From a commercial perspective, the Group recorded a 4% increase in Irish customer loans on an annualised basis, with growth across Irish mortgages, where we hold a market share of 41%, and in SME business banking and corporate portfolios. We have achieved this while maintaining our strong commercial focus and underwriting standards. In addition, in our Wealth and Insurance business, AUM increased €5 billion (21% annualised) to €51 billion, our highest level ever, with strong net inflows reflecting the strength of our New Ireland and Davy franchises. The momentum behind these franchises is underscored by 30% growth in the Group's total AUM since the end of June 2022, the month in which we acquired Davy. Fee income from our Wealth and Insurance business grew 6% in the first half, with a particularly strong performance in our Davy wealth franchise.

Simpler Business

The Group continues its ongoing focus on driving efficiency, resulting in a costincome ratio of 44% vs our medium term target of <50%. Improving customer journeys is increasing customer satisfaction, contributing to a 4 point increase in customer effort scores. For colleagues, there was a continued focus on progressive people policies, supporting the Group in attracting and retaining talent. These include the expansion of the Group's network of hybrid working hubs, the launch of a market-leading neuroinclusion strategy, and the payment of Group Profit Share and introduction of health benefits in H124.

Sustainable Company

There was further progress on our Sustainability strategy, as we continue to focus on practical, meaningful ESG interventions. Most notably, we continue to be the #1 provider for green mortgages in Ireland, and have expanded our sustainable agri-lending partnerships.

We have now provided sustainable finance of c.€12.5 billion, which represents an increase vs H123 of 24%. We are well on track to meet our c.€15 billion target for 2025 and c.€30 billion for 2030.

We also retained our #1 position for Financial Wellbeing in Ireland with a focus in H1 on youth financial literacy. There were also improvements in H1 in respect of gender balance in appointments at managerial and leadership positions, now standing at 46% vs 41% at the same point last year. In the period, we also published our FY23 Sustainability Report accompanied by a new ESG Investor Presentation.

Economic Outlook

The Irish economy continues to perform resiliently, notwithstanding certain global geopolitical and macroeconomic uncertainties. Bank of Ireland forecasts headline (GDP) growth of 1.0% in 2024, rising to 3.9% in 2025.

In respect of the domestic Irish economy, a host of indicators point to a supportive backdrop. These include employment trends with Irish employment at 2.7 million, +14% from the pre-pandemic level, with a seasonally adjusted unemployment rate of 4.2% in June (December 2023: 4.5%). In addition, the health of the consumer is further illustrated by retail sales data that show growth in spend in cash terms of 5% year on year in Q1 2024. Finally, the headline rate of inflation has moderated to 2.2% year on year (June 2024), down from 4.6% year on year at end-2023.

Against this positive backdrop, capacity constraints remain a challenge for the economy. Housing is the most prominent of these. Housing completions were 33k in 2023 and are expected to grow over the coming years, but are likely to be below estimates of annual new household formation. Bank of Ireland's strategy is to support the development of new homes in Ireland and home ownership which in turn supports the growth of our Irish lending book.

Moving to the UK, Bank of Ireland forecasts headline (GDP) growth of 0.8% in 2024, rising modestly to 1.4% in 2025, with trends in H1 to date a little bit stronger than previously anticipated after the "technical recession" in H223.

H124 Business and Financial Performance

The Group reported profit before tax of €1.1 billion in H124 (H123: €1.0 billion), helping to produce an adjusted RoTE of 18.9%. Net interest income of €1.8 billion, flat compared to H123, was supported by higher interest rates and customer loan balances, offset by slightly lower deposit balances, higher deposit costs and the movement of UK personal loans to non-core.

FY24 net interest income is expected to be c.€3.55 billion.

The Group's loan book increased by €1.8 billion during H124. On a constant currency basis, the loan book increased by €1.0 billion, with a €1.0 billion increase in Irish non-property and a €0.4 billion increase in Retail UK, partially offset by a €0.3 billion reduction in UK personal loans and a €0.1 billion reduction in Property and International Corporate and other.

Business income of €384 million, including share of associates and joint ventures, was 6% higher than H123. This primarily reflected growth in Wealth and Insurance and lower Retail UK commissions, partially offset by lower Corporate and Commercial fee income. Business income in 2024 is expected to be mid-single digit percent higher than 2023.

Cost discipline is core to our strategy. Reported costs were 6% higher in H124, in line with our guidance. This primarily reflects inflation and investment and the positive impact of ongoing efficiencies. 2024 operating expenses are expected to be 5-6% higher than 2023. We expect levies and regulatory charges to be €125 to €130 million in 2024, lower than our previous guidance of €160 to €165 million, based on reduced deposit guarantee scheme contributions.

The Group reported an underlying net credit impairment charge of €50 million in H124 compared to a charge of €158 million in H123. This reduction reflects an improved macroeconomic outlook, model changes, movement in management adjustments, and actual loan loss experience in the period. In 2024, subject to no material change in economic conditions or outlook, we expect an impairment charge of c.20 basis points.

Group deposits have increased €0.6 billion in H124 to €100.8 billion. This increase reflects growth in Retail Ireland and Retail UK, partially offset by lower Corporate and Commercial volumes.

Our liquidity profile is very strong, supported by our retail franchise in Ireland. The Group's liquidity ratios reflect this strength. At June 2024, the Group's liquidity coverage ratio was 199% (2023: 196%), the loan to deposit ratio was 81% (2023: 80%) and the net stable funding ratio was 153% (2023: 157%).

Our fully loaded CET1 capital ratio was 15.4% at June 2024 including H1 unaudited profits and a deduction for an interim ordinary dividend (31 December 2023: 14.3%). The Group's capital performance benefitted from strong net organic capital generation of 170 basis points and a slight net reduction in RWAs, partially offset by a deduction for an interim dividend. The Group's reported fully loaded CET1 ratio was 14.4%, reflecting the mechanical exclusion of H1 profits in accordance with recent EBA guidance. The Group is commencing interim ordinary dividend distributions resulting in a dividend of €352 million (35 cents DPS), equivalent to 40% of H1 profit after tax.

The dividend will be paid on 7 November 2024 to shareholders on the register on 11 October 2024. 2024 distributions will comprise a combination of ordinary dividends and share buybacks with an objective to distribute to CET1 guidance of >14%, subject to necessary approvals. We expect Basel IV implementation in 2025 to reduce RWAs by up to 5%.

The Group's UK motor finance business continues to participate in the FCA's review of historical commission arrangements, with an update now expected in May 2025.

Outlook

The Group has had an excellent performance in the first half. We are entering the second half of the year with momentum notwithstanding geopolitical developments and the evolving competitive environment. We have now reached the mid-point of our three year strategic cycle and are meeting or beating all the targets we have set.

Our differentiated business model operates in structurally attractive and growing markets and is highly capital generative. These factors, complemented by our single-minded focus on delivery, make us very well positioned to continue to deliver attractive returns for our shareholders through the current strategic cycle and beyond.

Key highlights

44% Underlying CIR	+7 points improvement in RNPS
+4% increase in Irish loans	#1 for Financial Wellbeing in Ireland
18.9%	€352m
adjusted RoTE	of interim dividends

Myles O'Grady Group Chief Executive

Operating and financial review (incorporating risk management)

Basis of presentation

The operating and financial review (OFR) is presented using IFRS and non-IFRS measures / alternative performance measures (APMs) to analyse the Group's performance. APMs include 'underlying' basis, which excludes non-core items the Group believes obscure the underlying performance trends in the business. Further information on measures referred to in the OFR are found in APMs on page 115. The income statements are presented for the six months ended 30 June 2024 (H124) compared to the six months ended 30 June 2023 (H123). The balance sheets are presented for 30 June 2024 compared to 31 December 2023. Percentages presented throughout this document are calculated on the absolute underlying figures and so may differ from the percentage variances calculated on the rounded numbers presented. Where the percentages are not measured, this is indicated by n/m.

Summary consolidated income statement on an underlying basis

		6 months ended	6 months ended
	Table	30 June 2024 €m	30 June 2023 €m
Net interest income1	1	1,802	1,802
Net other income1	2	394	399
Operating income		2,196	2,201
Operating expenses (before levies and regulatory charges)1	3	(961)	(907)
Levies and regulatory charges	3	(111)	(110)
Operating profit before net impairment losses on financial instruments		1,124	1,184
Net impairment losses on financial instruments1	4	(50)	(158)
Share of results of associates and joint ventures (after tax)		17	11
Underlying profit before tax		1,091	1,037
Non-core items1	5	(11)	(12)
Profit before tax		1,080	1,025
Tax charge		(203)	(172)
Profit for the period		877	853

Key ratios
Statutory cost income ratio (%)		50	47
Underlying cost income ratio (%)		44	42
Return on Tangible Equity (%)		16.4	17.0
Return on Tangible Equity (adjusted) (%)		18.9	18.5
Return on assets (bps) (annualised)		111	110

Per ordinary share
Basic earnings per share (€ cent)		80.8	74.1
Underlying earnings per share (€ cent)		83.3	76.7
Tangible Net Asset Value per share (€ cent)		996	924
Interim dividend per share (€ cent)		35	–

¹Performance is reported on an underlying basis and has been adjusted to exclude non-core items that the Group believes obscure the underlying performance trends in the business and is considered an APM. A reconciliation between the IFRS and summary consolidated income statement on an underlying basis is set out on page 18. For further information on APMs see page 115.

Profit before tax of €1,080 million was reported by the Group for H124 (H123: €1,025 million).

Underlying profit before tax of €1,091 million was €54 million higher than H123.

Net interest income remained stable compared to H123, due to higher lending income and volumes, increased liquid asset income, supported by our Irish deposit franchise, offset by the impact of higher wholesale funding and deposit costs from the pass through of higher interest rates and the impact of UK personal loans recognised as non-core since H223. Net interest income was up c.2% on a like for like basis.

Net other income decreased by €5 million or 1% due to negative impacts from valuation items / other expenses of €22 million, offset by a €17 million increase in business income.

Operating expenses (before levies and regulatory charges) were up 6%, reflecting inflation and investment (including elevated investment to drive future benefits), offset by efficiencies.

Levies and regulatory charges increased by €1 million or 1% in H124.

Net impairment losses on financial instruments decreased by €108 million, reflecting actual loan loss experience in the period, movement in management adjustments, impact on IFRS 9 models of Forward-looking Information (FLI) from the Group's latest macroeconomic outlook and impairment model changes.

Share of results of associates and joint ventures (after tax) increased by €6 million primarily due to recognition of gains on investments during the period.

Non-core items were broadly unchanged compared to H123.

The tax charge for H124 of €203 million (H123: €172 million) reflected an effective statutory taxation rate of 19% (H123: 17%) for the Group. On an underlying basis, the effective taxation rate for H124 was 17% (H123: 15%). The effective tax rate was influenced by changes in the jurisdictional mix of profits and the higher rate for H124 also reflected that the increased Irish bank levy continued to be non-deductible for tax purposes.

Net interest income

Table: 1 Net interest income / net interest margin1	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m	Change %
Net interest income	1,802	1,802	–
Average interest earning assets (€bn)
Loans and advances to customers	80	79	1%
Other interest earning assets	41	44	(7%)
Total average interest earning assets	121	123	(2%)
Net interest margin (annualised)	3.00%	2.96%
Gross yield - customer lending (annualised)	4.11%	4.20%
Gross yield - liquid assets (annualised)	4.28%	2.99%
Average cost of funds - interest bearing liabilities and current accounts (annualised)	(1.21%)	(0.78%)

Stable net interest income due to higher lending income and volumes, increased liquid asset income, supported by our Irish deposit franchise, offset by the impact of higher wholesale funding and deposit costs from the pass through of higher interest rates and the impact of UK personal loans recognised as non-core since H223. Net interest income was up c.2% on a like for like basis.

The Group net interest margin (NIM) was 3.00% (H123: 2.96%).

Average cost of funds and gross yield represent the interest income or expense recognised on interest bearing items net of interest on derivatives which were in a hedge relationship with the relevant asset or liability. The average cost of funds increased by 43 bps from H123, primarily reflecting higher wholesale funding costs and higher deposit costs in the UK and Ireland.

The gross customer yield has decreased by 9 basis points to 4.11% from H123 due to higher hedging costs, offset by higher interest rates.

The liquid asset yield increased by 129 bps to 4.28% compared to H123, with higher interest rates increasing the yield.

Further information on APMs referred to in the tables above can be found in alternative performance measures on page 115.

Net other income

Table: 2	6 months ended 30 June 2024	6 months ended 30 June 2023	Change
Net other income1	€m	€m	%
Net other income	394	399	(1%)
Analysed as:
Business income
Retail Ireland	76	74	3%
Wealth and Insurance	176	166	6%
Retail UK	(5)	(18)	(72%)
Corporate and Commercial2	133	138	(4%)
Group Centre and other	(13)	(10)	30%
Total business income	367	350	5%
Other (expenses) / income
Loan sale expenses	(4)	(3)	33%
Transfers from debt instruments at FVOCI reserve	–	2	(100%)
Total other expenses	(4)	(1)	n/m
Other valuation items
Financial instrument valuation adjustments (CVA, DVA, FVA) and other3	40	28	43%
Investment valuation movement	(9)	22	n/m
Total other valuation items	31	50	(38%)

²Formerly Corporate and Markets.

³Credit Valuation Adjustment; Debit Valuation Adjustment; Funding Valuation Adjustment.

Net other income of €394 million was €5 million or 1% lower than H123.

Business income of €367 million for H124 increased by €17 million or 5% compared to H123:

Retail Ireland income increased by €2 million or 3% reflecting higher debit and credit cards income.
Wealth and Insurance including Davy increased by €10 million or 6%, with a particularly strong performance in the Davy wealth management business.
Retail UK primarily reflects profit sharing partnership arrangements relating to net interest income performance. The improved performance compared to H123 is mainly due to lower partner commissions paid.
Corporate and Commercial reflects underlying fee income growth, offset by treasury impacts.

Other expenses of €4 million were broadly unchanged compared to H123.

Other valuation items resulted in a gain of €31 million (H123: €50 million). These movements resulted from positive derivative related valuation adjustments across divisions, partially offset by a negative investment variance in Wealth and Insurance.

Operating expenses

Table: 3 Operating expenses1	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m	Change %
Staff costs (excluding pension costs)	430	406	6%
Pension costs	42	26	62%
Retirement benefit costs (defined benefit plans)	13	2	n/m
Retirement benefit costs (defined contribution plans)	29	24	21%
Depreciation and amortisation	126	109	16%
Other costs	363	366	(1%)
Operating expenses (before levies and regulatory charges)	961	907	6%
Levies and regulatory charges	111	110	1%
Total operating expenses	1,072	1,017	5%

Operating expenses (before levies and regulatory charges) were €54 million or 6% higher than H123. This includes an expense of €22 million relating to additional investment in strategic growth and simplification opportunities, to drive future efficiencies.

Staff costs (excluding pension costs) of €430 million were €24 million higher than H123 reflecting salary increases averaging 4% which were effective from 1 January 2024 and increased resources required to support business growth.

At 30 June 2024, the number of staff (full time equivalents) was 11,180, an increase of 669 or 6% compared to 10,511 at 30 June 2023. The increase in full time equivalents was primarily due to supporting business growth and insourcing of IT capability.

Average staff numbers employed by the Group in H124 of 11,053 were 697 or 7% higher compared to 10,356 in H123.

Pension costs of €42 million for H124 were €16 million or 62% higher than H123. Defined benefit pension costs have increased by €11 million. Pension costs included a negative past service cost of €5 million relating to the UK Life Balance scheme (H123: €17 million). New joiners are added to the Group's defined contribution plans, the cost of which has increased by €5 million compared to H123.

Other costs including technology, property, outsourced services and other non-staff costs were €3 million or 1% lower than H123. The decrease reflects the Group's tight control over its cost base.

Depreciation and amortisation costs were €17 million or 16% higher than H123. The increase was driven by investment in strategic programmes.

Levies and regulatory charges of €111 million have increased by €1 million in H124.

Net impairment losses on financial instruments

Table: 4 Net impairment losses on financial instruments1	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m	Change %
Net impairment (losses) / gains on loans and advances to customers at amortised cost
Residential mortgages	39	(86)	n/m
Retail Ireland	23	(50)	n/m
Retail UK	16	(36)	n/m
Non-property SME and corporate	(45)	(10)	n/m
Republic of Ireland SME	(42)	22	n/m
UK SME	21	1	n/m
Corporate	(24)	(33)	(27%)
Property and construction	(9)	(18)	(50%)
Investment	(8)	(22)	(64%)
Development	(1)	4	n/m
Consumer	(32)	(42)	(24%)
Total net impairment losses on loans and advances to customers at amortised cost	(47)	(156)	(70%)
Net impairment losses on other financial instruments (excluding loans and advances to customers at amortised cost)	(3)	(2)	50%
Total net impairment losses on financial instruments	(50)	(158)	(68%)
Underlying net impairment losses on loans and advances to customers (bps) (annualised)	(12)	(39)	69%
Net impairment losses on loans and advances to customers (bps) (annualised)	(11)	(39)	72%

The Group recognised an underlying net impairment loss of €50 million for H124, with a €1 million impairment gain recognised as non-core relating to UK personal loans (see page 12 for further details on non-core).

Including the €1 million impairment gain recognised in noncore, the total net impairment loss for H124 was €49 million and reflected a number of impairment dynamics:

net impairment losses associated with portfolio activities including updated credit risk assessments, recoveries, case specific loss emergence, and Non-performing exposure (NPE) resolution activity (c.€93 million net loss, includes other financial instruments);
impairment model updates incorporating the current macroeconomic outlook (c.€47 million net gain, includes other financial instruments); and
the application of Group post-model adjustments in H124 (c.€3 million net loss in the period), which reflected a number of potential risks not included in modelled impairment loss allowances. See pages 57 to 58 for further details.

The net impairment gain of €39 million in the residential mortgages portfolio in H124 primarily reflected a combination of: gains associated with model parameter updates, including updated macroeconomic outlook; reduced credit risk associated with inflation and interest rates; and reduced loss emergence on defaulted assets.

A net impairment gain on the Retail Ireland mortgage portfolio of €23 million for H124 included a net impairment gain of €13 million on credit-impaired assets (Stage 3 and purchased or originated credit-impaired assets or 'POCIs'), and compared to a loss of €50 million in H123.
A net impairment gain on the Retail UK mortgage portfolio of €16 million for H124 included a net impairment gain of €5 million on credit-impaired assets and compared to a net loss of €36 million in H123.

A net impairment loss of €45 million on the non-property small and medium enterprise (SME) and corporate loan portfolio for H124 included a net impairment loss of €47 million on credit-impaired assets and compared to a €10 million impairment loss for H123. The net impairment loss in H124 primarily reflected a limited amount of case specific loss emergence primarily on defaulted cases in the corporate portfolio, and impairment increases related to impairment methodology updates.

A net impairment loss of €9 million on the property and construction loan portfolio for H124 included a net impairment loss of €32 million on credit-impaired assets and compared to a loss of €18 million in H123. The net impairment loss reflects case specific loss emergence on defaulted assets, partly offset by gains associated with model parameter updates, including the updated macroeconomic outlook.

Net impairment losses on financial instruments (continued)

The net impairment loss of €31 million on the consumer loans portfolio comprised of a €32 million loss on an underlying basis (per table above) with an impairment gain of €1 million recognised as non-core relating to UK personal loans. The €31 million net impairment loss (€25 million loss in Retail Ireland, €4 million loss in Corporate and Commercial and €2 million loss in Retail UK), included a loss on credit-impaired assets of €31 million and was €11 million favourable to the loss of €42 million in H123.

The net loss primarily reflects loss emergence on defaulted assets, losses associated with model parameter updates (including updated macroeconomic outlook), and an increase in the quantum of post-model adjustment applied at 30 June 2024 to recognise losses associated with potential portfolio disposals for NPE resolution within the consumer portfolio (€9 million at 31 December 2023 increasing to €12 million at 30 June 2024). The net loss was partially offset by a reduction in credit risk associated with inflation and interest rates.

Non-core items

Table: 5 Non-core items	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m	Change %
Transformation programme (costs) / credit	(25)	7	n/m
Cost of restructuring programme	(25)	(12)	n/m
Other transformation refund	–	19	(100%)
Portfolio divestments (net)	25	–	n/m
Acquisition costs	(19)	(33)	(42%)
Gross-up for policyholder tax in the Wealth and Insurance business	14	14	–
Liability management exercises	(4)	–	n/m
Investment losses on treasury shares held for policyholders	(2)	–	n/m
Total non-core items	(11)	(12)	(8%)

Transformation programme

During H124, the Group recognised net transformation programme costs of €25 million (H123: €7 million credit), which included:

restructuring charges of €25 million (H123: €12 million) were incurred and relate to the implementation of the Group's property strategy, voluntary redundancy scheme and external programme management costs; and
no other transformation costs were recognised in H124. In H123, a €19 million refund was recognised in relation to previous projects, as part of the strategic review of the Retail UK operations that did not proceed.

Portfolio divestments

In 2023, in line with the Group's transformation strategy in the UK, the Group announced the cessation of the provision of unsecured personal loan products under the Bank of Ireland (UK) plc and UK Post Office brand, and the UK personal loans business was moved to non-core items.

As a result, included within the portfolio divestment net gain of €25 million (H123: €nil) was interest income of €30 million (H123: €nil), expenditure of €6 million (H123: €nil) and an impairment gain of €1 million (H123: €nil) relating to this business.

Acquisition costs

The Group acquired Davy in 2022 as a business combination in line with IFRS 3. In H124, €19 million (H123: €27 million) of costs associated with the acquisition were expensed to the income statement:

• deferred remuneration expense of €12 million (H123: €13 million) was accrued and includes the incurred portion of deferred remuneration, as well as remuneration related to a Special Incentive and Retention Plan (SIRP). The costs are payable to some Davy employees on the fulfilment of certain conditions;

integration costs of €4 million (H123: €11 million) include external costs relating to project management, professional advice and support; and internal integration costs related to an internal dedicated team to deliver the acquisition and integration of Davy; and
amortisation of €3 million (H123: €3 million) related to the acquired intangible assets (customer relationships and brand).

The Group completed the KBC Bank Ireland (KBCI) portfolio acquisition on 3 February 2023. There were no non-core costs related to the acquisition in H124 (H123: €6 million).

Gross-up for policyholder tax in the Wealth and Insurance business

IFRS requires that the income statement be grossed up for the total tax payable by Wealth and Insurance, comprising both policyholder and shareholder tax. In H124, this was a non-core gain of €14 million (H123: €14 million).

Liability management exercises

In H124, a loss of €4 million (H123: €nil) on liability management exercises was recognised, reflecting the repurchase of certain Group perpetual non-call instruments.

Investment losses on treasury shares held for policyholders

The Group's income statement excludes the impact of the change in value of Bank of Ireland Group plc ('BOIG plc') shares held by Wealth and Insurance for policyholders. In H124, this was a loss of €2 million (H123: €nil). At 30 June 2024, there were 0.7 million shares (H123: 1.1 million shares) held for the benefit of policyholders.

Summary consolidated balance sheet

		30 June 2024	31 December 2023
Summary consolidated balance sheet	Table	€bn	€bn
Assets
Loans and advances to customers	6	81	80
Liquid assets	7	44	44
Wealth and Insurance assets		27	25
Other assets	8	7	7
Total assets		159	156

Liabilities
Customer deposits	9	101	100
Wholesale funding	10	12	12
Wealth and Insurance liabilities		26	24
Other liabilities	8	5	5
Subordinated liabilities		2	2
Total liabilities		146	143
Shareholders' equity		12	12
Other equity instruments - Additional tier 1		1	1
Total liabilities and shareholders' equity		159	156

The Group's loans and advances to customers (after impairment loss allowances and including held for sale) of €81.5 billion were €1.8 billion higher than 31 December 2023, primarily driven by higher volumes in the RoI and UK mortgage portfolios. On a constant currency basis, the loan book increased by €1.0 billion reflecting positive net new lending in the period.

The Group's portfolio of liquid assets at 30 June 2024 of €44.4 billion increased by €0.8 billion from 31 December 2023, primarily due an increase in Tier 2 volumes €0.5 billion, higher wholesale funding volumes of €0.4 billion, higher deposit volumes of €0.3 billion (constant currency basis), FX movements on liquid assets of €0.1 billion and other items (includes retained earnings) of €0.5 billion, partially offset by higher lending volumes €1.0 billion (constant currency basis).

The Group's asset quality continued to improve in H124. NPEs reduced by €0.1 billion to €2.4 billion, representing 2.9% of gross loans at 30 June 2024 (31 December 2023: 3.1%). Reduction in NPEs reflected execution of resolution strategies, partly offset by the emergence of new defaults for case specific reasons primarily in corporate portfolios.

At 30 June 2024, Group customer deposit volumes of €100.8 billion were €0.6 billion higher than 31 December 2023, predominantly driven by higher Retail UK volumes of €1.2 billion and higher Retail Ireland volumes of €0.9 billion, partially offset by lower Corporate and Commercial volumes of €1.5 billion.

Wholesale funding balances of €12.2 billion at 30 June 2024 were €0.4 billion higher than 31 December 2023. This is primarily due to minimum requirement for own funds and eligible liabilities (MREL) senior bond issuance of €0.9 billion, partially offset by part repayment of Bank of England Term Funding Scheme for Small and Medium-sized Enterprises (TFSME) funding of c.€0.2 billion and lower interbank deposits of c.€0.3 billion.

The Group's proforma fully loaded common equity tier 1 (CET1) ratio with inclusion of the H1 unaudited profits was 15.4% at 30 June 2024 (31 December 2023: 14.3%). The increase of c.110 basis points is primarily due to net organic capital generation (c.+170 basis points), the reduction in Risk Weighted Assets (RWAs) (c.+10 basis points), offset by a foreseeable dividend deduction (c.-70 basis points). The Group's fully loaded CET1 ratio (excluding the H1 unaudited profits) was 14.4%. For further information on capital ratios see Capital Adequacy risk section from page 36.

Key ratios	30 June 2024	31 December 2023
Liquidity Coverage Ratio (%)	199	196
Net Stable Funding Ratio (%)	153	157
Loan to Deposit Ratio (%)	81	80
Gross new lending volumes (€bn)	8.4	15.8
Average interest earning assets (€bn)	121	122
CET1 ratio - fully loaded (%)	14.4	14.3
CET1 ratio - regulatory (%)	14.4	14.5
Total capital ratio - regulatory (%)	20.1	19.2

Further information on APMs referred to in the table above can be found in alternative performance measures on page 115.

Summary consolidated balance sheet (continued)

Loans and advances to customers

Table: 6	30 June 2024		31 December 2023
Loans and advances to customers - Composition	€bn	%	€bn	%
Residential mortgages	49	60%	47	58%
Retail Ireland	33	40%	32	40%
Retail UK	16	20%	15	18%
Non-property SME and corporate	20	25%	20	25%
Republic of Ireland SME	7	9%	7	9%
UK SME	1	1%	1	1%
Corporate	12	15%	12	15%
Property and construction	7	8%	8	10%
Investment	6	7%	7	9%
Development	1	1%	1	1%
Consumer	6	7%	6	7%
Total loans and advances to customers at amortised cost	82	100%	81	100%
Less impairment loss allowance on loans and advances to customers at amortised cost	(1)		(1)
Net loans and advances to customers at amortised cost	81		80
Loans and advances to customers at FVTPL	–		–
Total loans and advances to customers	81		80

Gross new lending of €8.4 billion was €0.1 billion higher than H123 (€0.4 billion higher, excluding the impact of the UK personal loans business which did no new lending in H124). The increase of €0.4 billion reflected an increase of 12% in both Corporate and Commercial and Retail UK, partially offset by a reduction of 9% in Retail Ireland where elevated levels of new mortgage lending in 2023 were not repeated.

Redemptions and repayments of €7.4 billion were €0.9 billion lower than H123, with lower redemption activity across all divisions.

The Group's IFRS 9 staging profile has improved. There was a net reduction of €1.6 billion of loans in Stage 2 (i.e. assets identified as having experienced a significant increase in credit risk since origination) to €10.9 billion (31 December 2023: €12.5 billion). This reflected the reduced impact of elevated interest rates and inflation on credit risk in the loan book, other portfolio activity (including net repayments / redemptions in the period) and the application of updated FLI.

Stage 3 balances decreased by €0.1 billion to €2.3 billion (31 December 2023: €2.3 billion) reflecting resolution activities in the period, partly offset by the emergence of new defaults.

During H124, the stock of impairment loss allowances increased by €0.1 billion to €1.3 billion. The increase reflected the impairment loss on loans and advances to customers, the impact of currency translation and other movements, partly offset by impairment loss allowance utilisation of €0.1 billion.

NPEs decreased by €0.1 billion to €2.4 billion, representing 2.9% of gross loans at 30 June 2024 (31 December 2023 3.1%). NPE reductions were primarily delivered through case specific resolution strategies, particularly in relation to a small number of large defaulted cases in Corporate non-property portfolios.

NPEs	30 June 2024	31 December 2023
Credit-impaired loans (€bn)	2.4	2.5
NPEs (€bn)	2.4	2.5
NPE ratio (%)	2.9	3.1

Further information on APMs referred to above can be found in alternative performance measures on page 115.

Summary consolidated balance sheet (continued)

Liquid assets (after impairment loss allowance)

Table: 7 Liquid assets (after impairment loss allowance)	30 June 2024 €bn	31 December 2023 €bn
Cash at banks	2	2
Cash and balances at central banks	32	32
Central Bank of Ireland	28	28
Bank of England	3	3
Federal Reserve	1	1
Government bonds	5	5
Debt securities at amortised cost	4	4
Financial assets at FVOCI	1	1
Covered bonds	3	3
Senior bank bonds and other	2	2
Total liquid assets	44	44

The Group's portfolio of liquid assets at 30 June 2024 has increased by €0.8 billion to €44.4 billion, primarily due an increase in Tier 2 volumes €0.5 billion, higher wholesale funding volumes of €0.4 billion, higher deposit volumes of €0.3 billion (constant currency basis), FX movements on liquid assets of €0.1 billion and other items (includes retained earnings) of €0.5 billion, partially offset by higher lending volumes €1.0 billion (constant currency basis).

Other assets and other liabilities

Table: 8 Other assets and other liabilities	30 June 2024 €bn	31 December 2023 €bn
Other assets	7.2	7.4
Derivative financial instruments	3.7	4.3
Deferred tax asset	0.7	0.8
Pension surplus (net)	0.8	0.7
Fair value changes due to interest rate risk of the hedged items in portfolio hedges	(0.3)	(0.1)
Other assets	2.3	1.7
Other liabilities	5.4	5.4
Derivative financial instruments	4.6	4.5
Fair value changes due to interest rate risk of the hedged items in portfolio hedges	(1.6)	(1.1)
Notes in circulation	0.9	0.9
Other liabilities	1.5	1.1

Fair value movements of derivative assets and derivative liabilities were impacted by changes in equity markets, interest rates, FX and maturity of transactions during H124. The movement in fair value changes due to interest rate risk of the hedged items in portfolio hedges was attributable to interest rate moves between 30 June 2024 and 31 December 2023.

The deferred tax asset (DTA) at 30 June 2024 primarily related to unused historic tax losses and decreased in the period due to utilisation against current period profits. See note 21 for further details.

The net pension position was a surplus of €0.8 billion at 30 June 2024 (31 December 2023: €0.7 billion), primarily due to increases in RoI and UK discount rates resulting in decreased pension liabilities.

Summary consolidated balance sheet (continued)

Customer deposits

Table: 9 Customer deposits	30 June 2024 €bn	31 December 2023 €bn
Retail Ireland	45	44
Deposits	22	20
Current account credit balances	23	24
Corporate and Commercial	41	43
Deposits	10	12
Current account credit balances	31	31
Retail UK	15	13
Retail UK (Stg£bn equivalent)	12	12
UK Post Office	6	6
Other Retail UK	6	6
Total customer deposits	101	100

At 30 June 2024, overall Group customer deposit volumes of €100.8 billion were €0.6 billion higher than 31 December 2023, predominantly driven by higher Retail UK volumes of €1.2 billion and higher Retail Ireland volumes of €0.9 billion, partially offset by lower Corporate and Commercial volumes of €1.5 billion.

Wholesale funding

Table: 10 Wholesale funding	30 June 2024 €bn	31 December 2023 €bn
Secured funding	4	4
Monetary Authority	2	2
Covered bonds	1	1
Securitisations	1	1
Unsecured funding Senior debt	8 7	8 7
Bank deposits	1	1
Total wholesale funding	12	12
Wholesale market funding < 1 year to maturity	1	1
Wholesale market funding > 1 year to maturity	9	9

Monetary Authority funding < 1 year to maturity	2	1
Monetary Authority funding > 1 year to maturity	–	1

Wholesale funding balances of €12.2 billion at 30 June 2024 were €0.4 billion higher than 31 December 2023. This is primarily due to MREL senior bond issuance of €0.9 billion, partially offset by part repayment of Bank of England TFSME funding of c.€0.2 billion and lower interbank deposits of c.€0.3 billion.

Divisional review

The divisional review provides further information on the financial performance of the Group's divisions during H124 as well as some key performance metrics.

The divisional review is presented using IFRS and non-IFRS measures. Non-IFRS measures include 'underlying divisional contribution', an alternative performance measure the Group uses which reflects the underlying financial contribution of each division towards the consolidated Group underlying profit or loss, before tax, excluding non-core items which obscure the underlying performance of the divisions.

Other reconciling items represent inter segment transactions which are eliminated upon consolidation and the application of hedge accounting at Group level.

	6 months ended 30 June 2024 €m	Restated1 6 months ended 30 June 2023 €m
Underlying divisional contribution
Retail Ireland1	540	414
Wealth and Insurance	47	77
Retail UK	195	133
Corporate and Commercial	613	701
Group Centre1	(311)	(296)
Other reconciling items	7	8
Group underlying profit before tax	1,091	1,037
Non-core items by division
Retail Ireland	–	(3)
Wealth and Insurance	5	9
Retail UK	20	16
Corporate and Commercial	(1)	–
Group Centre	(27)	(18)
Other reconciling items	(8)	(16)
Group non-core items	(11)	(12)
Group profit before tax	1,080	1,025

¹Comparative figures have been restated to reflect the reallocation of intangible assets and related amortisation from Group Centre to the division deriving the economic benefits, as a result operating expenses have decreased by €25 million in Group Centre, with a corresponding increase of €25 million in Retail Ireland. The reallocation had no impact to total Group figures.

Further information on measures referred to in our consolidated balance sheet can be found in alternative performance measures on page 115.

Divisional income statement on an underlying basis - operating segments

In the tables below, 'underlying' excludes the impact of non-core items (page 12). The tables below provide a reconciliation of the income statement on an underlying basis to the Group statutory profit / loss before tax.

6 months ended 30 June 2024	Net interest income / (expense)1 €m	Insurance service result €m	Net other income Insurance investment & finance result €m	Other income / (expense)1 €m	Total operating income / (expense) €m	Operating expenses1 €m	Operating profit / (loss) before net impairment losses on financial instruments €m	Net impairment (losses) / gains on financial instruments1 €m	Share of results of associates and joint ventures (after tax) €m	Profit / (loss) before taxation €m
Divisional underlying contribution
Retail Ireland	735	–	–	74	809	(265)	544	(4)	–	540
Wealth and Insurance	(3)	22	(25)	170	164	(117)	47	–	–	47
Retail UK	282	–	–	5	287	(140)	147	36	12	195
Corporate and Commercial	786	–	–	156	942	(252)	690	(82)	5	613
Group Centre	2	–	(1)	(11)	(10)	(301)	(311)	–	–	(311)
Other reconciling items	–	–	–	4	4	3	7	–	–	7
Group - underlying	1,802	22	(26)	398	2,196	(1,072)	1,124	(50)	17	1,091
Total non-core items
Transformation programme costs	–	–	–	–	–	(25)	(25)	–	–	(25)
Portfolio divestments	30	–	–	–	30	(6)	24	1	–	25
Acquisition costs	–	–	–	3	3	(22)	(19)	–	–	(19)
Gross-up for policyholder tax in Wealth and Insurance business	–	–	–	14	14	–	14	–	–	14
Liability management exercises	–	–	–	(4)	(4)	–	(4)	–	–	(4)
Investment losses on treasury stock held for policyholders	–	–	–	(2)	(2)	–	(2)	–	–	(2)
Group total	1,832	22	(26)	409	2,237	(1,125)	1,112	(49)	17	1,080

Bank of Ireland Interim Report 2024

Divisional income statement on an underlying basis - operating segments

			Net other income				Operating profit / (loss) before net	Net	Share of results of
Restated1 6 months ended 30 June 2023	Net interest income / (expense) €m	Insurance service result €m	Insurance investment & finance result €m	Other income / (expense)2 €m	Total operating income / (expense) €m	Operating expenses1,2 €m	impairment losses on financial instruments €m	impairment (losses) / gains on financial instruments €m	associates and joint ventures (after tax) €m	Profit / (loss) before taxation €m
Divisional underlying contribution
Retail Ireland	656	–	–	73	729	(251)	478	(64)	–	414
Wealth and Insurance	(4)	26	76	86	184	(107)	77	–	–	77
Retail UK	327	–	–	(1)	326	(142)	184	(63)	12	133
Corporate and Commercial	821	–	–	147	968	(235)	733	(31)	(1)	701
Group Centre	2	–	(4)	(10)	(12)	(284)	(296)	–	–	(296)
Other reconciling items	–	–	–	6	6	2	8	–	–	8
Group - underlying	1,802	26	72	301	2,201	(1,017)	1,184	(158)	11	1,037
Total non-core items
Transformation programme costs	–	–	–	–	–	7	7	–	–	7
Portfolio divestments	–	–	–	–	–	–	–	–	–	–
Acquisition costs	–	–	–	–	–	(33)	(33)	–	–	(33)
Gross-up for policyholder tax in the Wealth and Insurance business	–	–	–	14	14	–	14	–	–	14
Liability management exercises	–	–	–	–	–	–	–	–	–	–
Investment losses on treasury stock held for policyholders	–	–	–	–	–	–	–	–	–	–
Group total	1,802	26	72	315	2,215	(1,043)	1,172	(158)	11	1,025

²Performance is reported on an underlying basis and has been adjusted to exclude non-core items that the Group believes obscure the underlying performance trends in the business and is considered an APM. For further information see page 115.

Retail Ireland

Retail Ireland serves customers across a broad range of segments and sectors with financial products and services tailored to meet their needs.

The Group notes the following achievements under our strategic pillars for 30 June 2024:

Stronger relationships

Continued progress on enhancing customer service and brand loyalty, with period on period increases in both Retail Ireland's Customer Effort Score (+57, up 4) and Relationship Net Promoter Score (RNPS) (+14, up 6).
Significant investment in fraud prevention and protection, which included over 100 fraud awareness events held across our network in H124. These events are open to all, whether a customer or not.
Customer complaints continue to trend downwards, with H124 volumes the lowest levels seen in 10 years.

Simpler business

Continued long-term investment in customer service improvements on our telephony and customer relationship management systems, which will lead to faster resolution of customer calls, enhanced self service options, allow more 24/7 transactions and improved customer security.
Initial launch of the integration of our digital mortgage origination platform with key external brokers, enabling a more efficient customer journey for this important distribution channel.

Sustainable company

Successful launch of the innovative EcoSaver Mortgage, expanding the Group's market leading Green Mortgage, which supports new and existing customers to purchase or retrofit their homes to higher energy standards.
Multi-year investment in ATMs and branch network, supporting better access to cash whilst also enabling ESG ambitions through energy reductions.

Retail Ireland Income statement on an underlying basis	6 months ended 30 June 2024 €m	Restated1 6 months ended 30 June 2023 €m
Net interest income	735	656
Net other income	74	73
Operating income	809	729
Operating expenses	(265)	(251)
Operating contribution before net impairment losses on financial instruments	544	478
Net impairment losses on financial instruments	(4)	(64)
Underlying contribution	540	414
Net impairment losses on financial instruments
Loans and advances to customers at amortised cost	(2)	(63)
Residential mortgages	23	(50)
Consumer	(25)	(13)
Other financial instruments: loan commitments and guarantees	(2)	(1)

Retail Ireland Balance sheet	30 June 2024 €bn	31 December 2023 €bn
Loans and advances to customers (net)	34.6	33.8
Customer deposits	44.8	43.9

Net impairment losses on financial instruments (4) (64)

Compared to H123:

Operating income was €80 million higher reflecting a supportive interest rate, macroeconomic environment and business momentum.
Operating expenses were €14 million higher due to continued investment in IT infrastructure.
Net impairment loss was €60 million lower driven largely by an impairment gain from model parameter updates, including updated macroeconomic outlook, and improved credit risk outlook in H124. Prior year included the impact from onboarding KBCI portfolios and update to NPE portfolio disposal Loss Given Default (LGD) models.

Compared to 31 December 2023:

H124 reflects strong portfolio growth, notably in the mortgages book, resulting in an overall net increase of €0.8 billion in the lending book.
Customer deposits are €0.9 billion higher, including a flow to term deposits.

Wealth and Insurance

Wealth and Insurance is a market leading wealth, life, pensions and investments provider in Ireland and includes New Ireland Assurance and Davy.

The Group notes the following achievements under our three strategic pillars for 30 June 2024:

Stronger relationships

Successful launch of BetterHealth online healthcare service for new and existing LifeChoice customers.
Enhancements made to New Ireland Passive Individual Retirement Investment Strategy (IRIS) with diversity of assets increased with more choice and flexibility for customers.
Marked increase in new Davy wealth management relationships.
Sustained strong Davy client NPS and high adviser satisfaction.
Simpler business
Significant increase in adoption of New Ireland Corporate Pensions Platform, MyPension365.
Enhancement of New Ireland Broker and Agent Portal digital journeys. 91% of broker new business submitted digitally.
Straight-through digital protection journey now available for our customers, with non-complex cases issuing same day.
Implemented new treasury management system, streamlining Davy client payment processing.
Investment in enhancing Davy wealth customer engagement.

Sustainable company

Sustainability remains at core of New Ireland investment offerings, with c.38% of our investment funds designated as Article 8 (Light Green ESG Funds).
Wealth and Insurance published their 2nd Principal Adverse Impact Statement (PAIS) on 30 June 2024 in line with the Sustainable Finance Disclosure Regulation (SFDR).
Davy continues to offer sustainable investment solutions and has recently expanded offering to enhance their appeal to noninstitutional investors.

Wealth and Insurance Income statement on an underlying basis	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Net interest expense	(3)	(4)
Net other income1	176	166
Operating income	173	162
Operating expenses1	(117)	(107)
Operating contribution	56	55
Investment valuation movement	(9)	22
Underlying contribution	47	77

IFRS 17 has introduced contractual service margin (CSM) which represents the unearned profit of a group of insurance and reinsurance contracts which is released in line with the insurance service provided. The CSM of the Group increased by €11 million to €600 million during H124 (31 December 2023: €589 million) driven mainly by new business and positive market movements. A total of €32 million (H123: €30 million) was released from the CSM for services provided. The release represents services provided on insurance contracts offset with services provided on reinsurance contracts. See note 6 for further details.

H124 reflects strong growth in AUM, up over 10% from €46.1 billion at 31 December 2023 to €51.0 billion at 30 June 2024.
Operating income was €11 million higher, reflective of higher investment income, increased new business, increased AUM and trading activity, partially offset by an experience variance. New Ireland sales increased by 20% in H124.
Operating expenses were €10 million higher, supporting growth in AUM and continued investment in the business.
The impact of markets has resulted in a negative investment valuation movement of €9 million reflecting the fall in bond values in H124.

Wealth and Insurance (continued)

Embedded value

The table opposite outlines the Market Consistent Embedded Value (MCEV) performance using market consistent assumptions. The calculation of the MCEV company value is closely aligned to Solvency II and follows MCEV principles. IFRS 17 does not change the economic value of the business, which MCEV represents, but does change the timing of accounting profit recognition through deferral of profits captured in the CSM. As a result, the amounts in the MCEV tables are not directly comparable to IFRS 17 results.

The table opposite summarises the overall balance sheet of Wealth and Insurance on an MCEV basis, which increased to €1,340 million at 30 June 2024 (31 December 2023: €1,299 million). The Value of in Force (VIF) asset represents the after tax value of future income from the existing book.

Operating profit of €23 million for H124 was €28 million lower than H123, primarily due to lower experience profits and lower expected returns. This was partially offset by higher new business profits.

Embedded value profit before tax of €42 million (H123: €74 million) included a positive valuation movement of €19 million in New Ireland (H123: €23 million).

Wealth and Insurance (excluding Davy) Summary balance sheet (MCEV)	30 June 2024 €m	31 December 2023 €m
Net assets	554	575
Value of in Force	934	886
Tier 2 subordinated capital / debt	(166)	(162)
Pension scheme surplus / (deficit)	18	–
Total embedded value	1,340	1,299

Wealth and Insurance (excluding Davy) Income statement (MCEV)	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
New business profits	13	10
Existing business profits	14	45
Expected return	32	45
Experience variance	(18)	(2)
Assumption changes	–	2
Interest payments	(4)	(4)
Operating profit	23	51
Investment valuation movement	19	23
Embedded value profit before tax	42	74

Retail UK

Retail UK provides banking services to customers in the UK, including mortgages, savings, foreign exchange, asset finance and contract hire. It has a partnership with the Post Office which includes FRES¹ .

The Group notes the following achievements under our three strategic pillars for 30 June 2024:

Stronger relationships

Continuing to embed Consumer Duty requirements into every day banking activities and on track to deliver the next phase of UK Regulatory Consumer Duty by 31 July 2024.
Customers have benefited from a reduction in monthly payments through implementation of all UK Mortgage Charter requirements.

Simpler business

Significant investments in mortgage capability driving meaningful customer outcomes such as, development of the Customer Hub, automation of product launch and redemptions process, introduction of web chat allowing queries to be handled efficiently, identification and resolution of multiple customer pain points and new data transfer capability creating improved and faster communication with solicitors.
Significant improvements to digital channels: improved accessibility, more user friendly navigation of the UK website and optimised mobile experience, resulting in a 25% increase in customer journeys via mobile.

Sustainable company

Continued focus on implementing our sustainable strategy to deliver new sustainable products, that support customers green transition, while reducing our carbon emissions and improving our data and reporting capability.
Launched new personalised insights for UK customers on Money Insights 365 (Mi 365) to review spending patterns and help make better financial decisions.
During H124, Northridge Finance increased Alternatively Fuelled Vehicles (AFVs) from 10% to 14% of its fleet.

Retail UK Income statement on an underlying basis	6 months ended 30 June 2024 £m	6 months ended 30 June 2023 £m
Net interest income2	240	286
Net other income / (expense)	5	(1)
Operating income	245	285
Operating expenses2	(119)	(124)
Operating contribution before net impairment losses on financial instruments	126	161
Net impairment gains / (losses) on financial instruments2	30	(55)
Share of results of associates and joint ventures (after tax)	11	11
Underlying contribution	167	117
Underlying contribution (€m equivalent)	195	133

Net impairment gains / (losses) on financial instruments

Net impairment gains / (losses) on financial instruments	30	(55)
Other financial instruments: loan commitments and guarantees	–	2
Consumer2	(3)	(26)
Property and construction	2	(1)
Non-property SME and corporate	18	1
Residential mortgages	13	(31)
Loans and advances to customers at amortised cost	30	(57)

Retail UK Balance sheet	30 June 2024 £bn	31 December 2023 £bn
Loans and advances to customers (net)	17.6	17.4
Customer deposits	12.3	11.8

Compared to H123:

Operating income decreased by £40 million, due to lower net interest income as a result of personal loans being recognised as non-core from H223 and lower mortgage margins due to product mix.
Operating expenses were £5 million lower, as a result of maintaining a strong cost discipline while still creating operating efficiencies and continued investment in improving product offerings.
Underlying impairment gain of £30 million reflects a reduction in management adjustments mainly relating to cost of living pressures following normalisation of the market, a reduction in the Expected Credit Loss (ECL) held on COVID-19 government backed loans and normal portfolio activity.

Compared to 31 December 2023:

Loans and advances to customers (net) were £0.2 billion or 1% higher, reflecting slightly higher new business coupled with lower redemptions.
Customer deposits were £0.5 billion or 4% higher reflecting increased funding requirements due to growth and optimisation of funding structure.

¹FRES is a joint venture between Bank of Ireland (UK) plc and the UK Post Office.

Corporate and Commercial

Provides full range of lending, banking services and operating products focused on the Group's Corporate and Commercial Banking customers, along with the provision of treasury risk management services to all customer segments.

The Group notes the following achievements under our three strategic pillars for 30 June 2024:

Stronger relationships

Supporting customers as they navigate the evolving economic environment, with a vibrant customer thought leadership programme with the aim to equip customers to make decisions on their businesses' risks and improve their financial wellbeing.
Business Start Up Programme won the B2B Loyalty Programme or Initiative of the Year at the 'Irish Loyalty & CX Awards'.
Won 7 awards at Finance Dublin Deals of the Year 2024.

Simpler business

• Continuing to embed a digitally advanced and streamlined operating model, enabling simplification, enhanced customer service, while supporting business sustainability and improved returns.

Sustainable company

Supporting our national champion ambition on housing delivery, increasing funding by €750 million to €2.5 billion over 3 years to 2026 to deliver c.25,000 units, including a €600 million increase for social and affordable housing to support c.10,000 units.
Increased focus on long-term sustainable returns, cessation of new business origination in Corporate Banking Great Britain, including Subscription Finance and US Commercial Real Estate.
Customer engagement focused on how to support their ESG ambitions including the expansion of the Group's innovative Enviroflex product, which is now available to over 50% of Irish dairy farmers.
Growth in sustainability-linked loans (€2.9 billion of Corporate commitments as of June 2024), lending on renewable energy projects and increased Green Bond eligible lending.

Corporate and Commercial Income statement on an underlying basis	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Net interest income	786	821
Net other income	156	147
Operating income	942	968
Operating expenses1	(252)	(235)
Operating contribution before impairment losses on financial instruments	690	733
Net impairment losses on financial instruments	(82)	(31)
Share of results of associates and joint ventures (after tax)	5	(1)
Underlying contribution	613	701
Net impairment losses on financial instruments

Net impairment losses on financial instruments	(82)	(31)
Other financial instruments: loan commitments and guarantees	–	(4)
Consumer	(4)	–
Property and construction	(12)	(17)
Non-property SME and corporate	(66)	(10)
Loans and advances to customers at amortised cost	(82)	(27)

Corporate and Commercial Balance sheet	30 June 2024 €bn	31 December 2023 €bn
Loans and advances to customers (net)	26.1	25.9
Euro liquid asset bond portfolio	8.8	8.9
Customer deposits	41.4	42.9

Compared to H123:

Operating income was €26 million lower due to lower lending income and deposit balances, offset by a supportive interest rate and macroeconomic environment.
Operating expenses were €17 million higher due to continued investment in IT systems, with inflationary pressure largely contained through continued cost discipline.
Net impairment losses increased by €51 million, reflecting impact of model refinements in the period, updated macro environment forecasts and the potential impact of inflation and rising interest rates on loan valuations.

Compared to 31 December 2023:

Loan book was €0.2 billion or 1% higher, reflecting growth in Irish SME and sustainability linked lending, and a continued selective approach to international corporate and property lending.
Customer deposits were €1.5 billion or 3% lower, with ongoing pricing discipline maintained.

Group Centre

Group Centre incorporates the Group's central support and control functions, overseeing the Group customer strategy, establishing clear governance and control frameworks as well as providing management services to the Group.

The Group notes the following achievements under our three strategic pillars for 30 June 2024:

Stronger relationships

Additional functionality deployed for customers on our mobile app including extra financial wellbeing insights to help customers manage their finances better.
Customer-first campaign launched to connect colleagues to customers, regardless of role and to provide practical tools to help that happen.
To ensure we continue to attract diverse talent, enhanced healthcare allowance and additional annual leave flexibility were introduced.

Simpler business

A Simplification Centre of Excellence team was established and mobilised to support divisions to deliver improved customer and colleague journeys.
Neuroinclusion strategy launched with a suite of policies and process improvements designed to support neurodivergent colleagues.

Sustainable company

Sustainable related finance continued to grow to c.€12.5 billion (31 December 2023: €11.1 billion).
Publication of the Group's Sustainable Finance Framework in April.
Relocation of our London offices from Bow Bells house to a Grade A green building in Gresham St Paul's, London.
Cross-divisional and multidisciplinary AI Working Group established with the responsibility for the guardrails for implementing AI and Gen AI and prioritising use cases across the Bank.

Group Centre Income statement	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Net operating expense	(10)	(12)
Operating expenses (excluding levies and regulatory charges)1	(194)	(176)
Levies and regulatory charges	(107)	(108)
Underlying contribution	(311)	(296)

Income statement

Group Centre's income and costs comprise income from capital and other management activities; unallocated Group support costs; costs associated with the Irish Bank levy; along with contributions to the Single Resolution Fund (SRF), Deposit Guarantee Scheme (DGS) and other levies.

Compared to H123:

Net operating expense was broadly in line.
Operating expenses were €18 million or 10% higher, due to additional investment to deliver sustainable benefits.
Levies and regulatory charges decreased by €1 million in H124.

²Comparative figures have been restated to reflect the reallocation of intangible assets and related amortisation from Group Centre to the division deriving the economic benefits, as a result operating expenses have decreased by €25 million in Group Centre, with a corresponding increase of €25 million in Retail Ireland. The reallocation had no impact to total Group figures.

Principal Risks and Uncertainties

Principal risks and uncertainties facing the Group for the remaining six months of 2024 are set out below. This summary should not be regarded as a complete and comprehensive statement of all potential risks as other factors not yet identified, or not currently material, may adversely affect the Group. ESG factors (including climate related risks) represent a common risk driver across the Group's Principal Risk types. The ESG Risk Management Framework sets out the approach to the management of ESG risk factors in the Group. For further detail on risks facing the Group, see pages 135 to 142 of the Group's 2023 Annual Report

Business and strategic risk is the risk of not achieving agreed strategic and business goals, arising due to inadequate planning or implementation, and / or changes in the external environment or economic factors. This also includes adverse impacts on the franchise value, e.g. by implementing an unsuitable strategy, or maintaining an obsolete business model. Drivers include:

macroeconomic conditions and geopolitical uncertainties. Whilst inflation has abated, interest rates remain elevated, and there has been an escalation in geopolitical tensions. The potential impacts of these macroeconomic and geopolitical dynamics represent a risk to the Group in its markets and may manifest in adverse impacts to pricing, customer confidence and credit demand, collateral values and customers' ability to meet their financial obligations;
the risk attached to the implementation of the Group Strategic Plan;
changing business model for the Group including the evolving competitive landscape, accelerated digitisation, and changing consumer and business behaviours; and
challenges and risks to the Group's strategy to transform, as well as customer considerations. Failure to transform successfully, or respond to the other risks above, could prevent the Group from realising its strategic priorities.

Capital adequacy risk is the risk that the Group has insufficient capital to support its normal business activities, meet its regulatory capital requirements or absorb losses should unexpected events occur. While principal risks impact on the Group's capital adequacy to some extent, capital adequacy is primarily impacted by significant increases in credit risk or risk weighted assets (RWAs), materially worse than expected financial performance and changes to minimum regulatory requirements.

Conduct risk is the risk of poor outcomes for, or harm to, customers, clients and markets, arising from the delivery of the Group's products and services. The Group is exposed to conduct risk as a direct and indirect consequence from all the activities that the Group engages in during the normal conduct of its business. These risks may materialise from failures to comply with regulatory requirements or expectations, as an outcome of risk events in other principal risk categories, from changes in external market expectations or conditions, provision of products and services and the various activities performed by staff, contractors and third party suppliers.

Credit risk is the risk of loss resulting from a counterparty being unable to meet its contractual obligations to the Group in respect of loans or other financial transactions, or any other deterioration in a counterparty's credit worthiness. This risk includes debt underwriting risk, loan origination risk, credit concentration risk, cross border transfer risk, credit quality deterioration risk, default risk, and collateral valuation risk. Credit risk arises from loans and advances to customers and from certain other financial transactions such as those entered into by the Group with financial institutions, sovereigns, and state institutions.

Funding and liquidity risk is the risk that the Group will experience difficulty in financing its assets and / or meeting its contractual payment obligations as they fall due, or will only be able to do so at substantially above the prevailing market cost of funds. Liquidity risk arises from the differences in timing between cash inflows and outflows. Cash inflows are driven by, amongst other things, the maturity structure of loans and investments held by the Group, while cash outflows are driven by items such as the term maturity of debt issued by the Group and outflows from customer deposit accounts. The liquidity risk of the Group may also be impacted by external events which could result in a sudden withdrawal of deposits or the potential changes in customer behaviour. Funding risk can occur where there is an over-reliance on a particular type of funding, a funding gap, or a concentration of wholesale funding (including securitisations) maturities. The Group funds an element of its sterling balance sheet in part from euro (via cross currency derivatives), which creates an exposure to the cost of this hedging.

Life insurance risk is the risk of unexpected variation in the amount and timing of claims associated with insurance benefits. This variation, arising from changing customer mortality, life expectancy, health, or behavioural characteristics, may be short or long-term in nature.

Market risk is the risk of loss arising from movements in interest rates, FX rates, equity, credit spreads, or other market prices. Market risk arises from the structure of the balance sheet, the Group's business mix and includes discretionary risk taking. The Group permits discretionary risk taking activity in Davy and it can arise through market-making, whereby positions can be held to facilitate client orders. Market risk can also arise through the conduct of customer business, particularly in respect to fixed-rate lending and the execution of derivatives and FX business. The nature of the business mix and the Group's balance sheet profile can create interest rate risk in the banking book exposures which result in economic value of equity and net interest income sensitivities. Earnings for NIAC are directly exposed to movements in market prices as a sizeable portion of shareholder surplus is invested in high yield funds. In addition, NIAC's earnings are also indirectly exposed to changes in equity and property markets through fee income generated on unit-linked customer investments.

Operational risk is the risk of loss resulting from suboptimal or failed internal processes, systems, human factors, or from external events. These risks may arise from failure to effectively manage change, third parties, IT, talent recruitment and retention, data, models, reporting or complying with legal, tax, or regulatory requirements and expectations. In addition, risks can materialise through cybersecurity incidents as the frequency, sophistication, and severity of attacks continues to increase. The Group also continues to improve its operational resilience capabilities to effectively identify, prepare for, respond, recover, and learn from an operational disruption, irrespective of the cause and whether it is internal or due to a third party failure.

Regulatory risk is the risk that the Group does not identify legal or regulatory change or appropriately manage its relationships with its regulators. The Group is exposed to regulatory risk as a direct and indirect consequence from all the activities that the Group engages in during the normal conduct of its business. Regulatory risk may materialise from failure to identify new or existing regulatory and / or legislative requirements or deadlines, ensure appropriate governance is in place to embed regulatory requirements into processes, or failure to appropriately manage the Group's regulatory relationship.

Asset Quality

Asset Quality - Loans and advances to customers

The information in the Asset Quality section including referenced footnotes forms an integral part of the interim financial statements as described in the basis of preparation in note 1 to the financial statements.

The Group's asset quality reporting methodology is as set out on pages 158 and 159 of the Group's 2023 Annual Report.

Approach to measurement of impairment loss allowances

The Group's methodology for loan loss provisioning under IFRS 9 is set out on pages 160 to 162 of the Group's 2023 Annual Report.

During May 2024, two new Internal Rating Based models were implemented for the General Corporate and UK SME segments of the Non-Retail portfolio. The ECL model framework was also updated in May 2024 to reflect the implementation of these new models.

The calibration of the Probability of Default (PD), LGD and Exposure at Default (EAD) components within the model utilised for the Commercial Finance segment of the SME portfolio were enhanced to address model weaknesses, primarily related to LGD estimation and back-testing, identified as part of the Group's internal model validation process. The updates resulted in a c.€8 million increase in impairment loss allowance.

Assessment of the relationship between macroeconomic model factors and default rates during 2020 and 2021 considered default experience to be unrepresentative in certain retail portfolios due to Covid related supports and payment breaks available to borrowers during this period. As a result data points from the 2020 and 2021 period were excluded from the residential mortgage and Commercial Finance PD macro regression models.

Other model updates were applied for the reporting period including the application of updated FLI scenarios and probability weightings, as well as updates to model factors to take account of more recent observable data and refinement of macro regression models for PD estimation. The probability weightings for FLI scenarios at H124 includes consideration of economic uncertainty, primarily driven by geopolitical risk and inflation / interest rate expectations.

Total net impact of all model factor updates in H124, including those outlined above, and the application of updated FLI for Group loans and advances to customers and other financial instruments is a €47 million reduction in impairment loss allowances.

The Group's critical accounting estimates and judgements, including those with respect to impairment of financial instruments, including FLI are set out in note 2 of the consolidated financial statements.

Credit Risk associated with geopolitical risk, inflation and interest rates

In H124, the Group conducted a number of assessments in relation to credit risk associated with the impact of elevated inflation and interest rates on asset quality. In line with 2023 credit risk assessments continued to be implemented across the residential mortgage and consumer portfolios and, where appropriate, outputs have been utilised to identify significant increases in credit risk and the reclassification of Stage 1 assets as Stage 2. These credit risk assessments, which leveraged qualitative information not already captured in impairment models, resulted in a credit management decision to classify c. €2.0 billion of Stage 1 assets as Stage 2 at the reporting date (31 December 2023: c.€2.8 billion), with a corresponding €15 million increase in impairment loss allowance (31 December 2023: €33 million). The reduction in the staging and impairment loss allowance impact at H124 is driven by revisions to the underlying affordability thresholds used in the credit risk assessments to reflect reducing affordability pressures in 2024 with real wage growth returning as the rate of inflation reduces.

The impact of elevated inflation and interest rates have also been taken into account within individual credit assessments in the relationship managed commercial portfolios.

All US Commercial Real Estate Office exposures continue to be downgraded to ensure all performing loans in this portfolio are classified as Stage 2 or lower (i.e. Stage 3). In addition to this an Investment Property post-model adjustment to the Group's impairment loss allowance of €48 million has been retained to reflect ongoing latent risk in the wider Investment Property portfolio including the impact of prevailing interest rates in the commercial property market.

Furthermore, the final set of probability weightings applied to FLI scenarios utilised in the Group's impairment models incorporated the application of management judgement to initial modelled probability weightings to reflect economic uncertainty associated with factors including geopolitical risk, elevated interest rates, and the expected gradual and uneven path back to lower inflation in the Group's key economies. The estimated impact of this judgement was a c.€6 million increase in impairment loss allowance (31 December 2023: c.€31 million).

Further details on the selected FLI scenarios for the reporting period, Group post-model adjustments and management judgement incorporated into impairment model parameters are provided in note 2 of the consolidated financial statements.

Asset Quality - Loans and advances to customers (continued)

Composition and impairment

The tables below summarise the composition, credit-impaired volumes and related impairment loss allowance of the Group's loans and advances to customers at amortised cost (including loans and advances to customers held for sale of €20 million) at 30 June 2024.

At 30 June 2024 these tables exclude €196 million (31 December 2023: €205 million) of loans and advances to customers that are measured at fair value through profit or loss (FVTPL) and are therefore not subject to impairment under IFRS 9.

Credit-impaired includes Stage 3 and Purchased or Originated Credit-impaired (POCI) assets of €83 million (31 December 2023: €118 million).

Total POCI assets at 30 June 2024 were €139 million (31 December 2023: €143 million). €56 million of POCI assets (31 December 2023: €25 million) were no longer credit-impaired at the reporting date due to improvement in credit risk since purchase or origination. These loans will remain classified as POCI loans until derecognition.

30 June 2024 Credit-impaired loans and advances to customers - Composition and impairment	Advances (pre impairment loss allowance) €m	Credit Impaired loans €m	Credit impaired loans as % of advances %	Credit impaired impairment loss allowance €m	Impairment loss allowance as % of credit impaired loans %
Residential mortgages	48,709	800	1.6%	141	18%
Retail Ireland	32,881	423	1.3%	93	22%
Retail UK	15,828	377	2.4%	48	13%
Non-property SME and corporate	20,709	922	4.5%	354	38%
Republic of Ireland SME	7,255	360	5.0%	170	47%
UK SME	1,528	87	5.7%	17	20%
Corporate	11,926	475	4.0%	167	35%
Property and construction	7,171	435	6.1%	132	30%
Investment	6,537	385	5.9%	118	31%
Development	634	50	7.9%	14	28%
Consumer	5,784	150	2.6%	88	59%
Total	82,373	2,307	2.8%	715	31%
Purchased / originated credit-impaired	139	83	59.7%	8	10%
Total	82,512	2,390	2.9%	723	30%

31 December 2023 Credit-impaired loans and advances to customers - Composition and impairment	Advances (pre impairment loss allowance) €m	Credit Impaired loans €m	Credit impaired loans as % of advances %	Credit impaired impairment loss allowance €m	Impairment loss allowance as % of credit impaired loans %
Residential mortgages	47,130	770	1.6%	141	18%
Retail Ireland	32,102	383	1.2%	89	23%
Retail UK	15,028	387	2.6%	52	13%
Non-property SME and corporate	20,449	1,080	5.3%	330	31%
Republic of Ireland SME	7,153	342	4.8%	161	47%
UK SME	1,547	80	5.2%	22	28%
Corporate	11,749	658	5.6%	147	22%
Property and construction	7,223	369	5.1%	80	22%
Investment	6,683	320	4.8%	69	22%
Development	540	49	9.1%	11	22%
Consumer	5,801	130	2.2%	61	47%
Total	80,603	2,349	2.9%	612	26%
Purchased / originated credit-impaired	143	118	82.5%	12	10%
Total	80,746	2,467	3.1%	624	25%

Asset Quality - Loans and advances to customers (continued)

At 30 June 2024, loans and advances to customers (pre impairment loss allowance) of €82.5 billion were €1.8 billion higher than 31 December 2023, primarily driven by positive net new lending in the period, particularly within the RoI and UK mortgage portfolios, and the impact of currency translation, partially offset by the utilisation of impairment loss allowances in the period.

Credit-impaired loans decreased to €2.4 billion or 2.9% of customer loans at 30 June 2024 from €2.5 billion or 3.1% at 31 December 2023. This decrease reflected resolution strategies that include appropriate and sustainable support to viable customers who are in financial difficulty. The decrease from resolution strategies was partly offset by the emergence of new defaults in the period (primarily in corporate portfolios).

The application of updated FLI, individually assessed risk ratings, credit risk assessments (including the impact of revisions to affordability thresholds outlined on page 27 above), impairment model methodology updates, and other portfolio activity (including net repayments / redemptions in the period) resulted in the net migration of c.€1.6 billion loans from Stage 2 (i.e. cases that are identified as having experienced a significant increase in credit risk) to Stage 1 in the year.

The stock of impairment loss allowance on credit-impaired loans was €0.7 billion at 30 June 2024, which was €0.1 billion higher than the stock at 31 December 2023. The net increase incorporates the impairment loss on credit impaired loans of €0.1 billion and the impact of currency translation and other movements totalling €0.1 billion, partially offset by impairment loss allowance utilisation of €0.1 billion.

The total impairment loss allowance at 30 June 2024 includes a total post-model adjustment (PMA) of €88 million (31 December 2023: €85 million), which was recognised against loans and advances to customers. Details on the post-model management adjustments are provided in note 2 on pages 57 and 58.

Impairment loss allowance cover for credit-impaired loans increased to 30% at 30 June 2024 compared to 25% at 31 December 2023. This primarily reflects changes in the underlying asset / portfolio mix of the stage 3 population, with higher than average impairment requirements for assets migrating to stage 3 in the period and the resolution of existing stage 3 assets with lower than average impairment loss allowance cover.

Asset Quality - Loans and advances to customers (continued)

Risk profile of forborne loans and advances to customers

The Group's total risk profile of loans and advances to customers at amortised cost at 30 June 2024 of €82.5 billion (31 December 2023: €80.7 billion) is available in note 18. The tables below exclude €196 million of loans and advances to customers at 30 June 2024 (31 December 2023: €205 million) that are measured at FVTPL and are therefore not subject to impairment under IFRS 9. Exposures are before impairment loss allowance.

30 June 2024 Loans and advances to customers at amortised cost - Composition	Stage 1 (not credit impaired) €m	Stage 2 (not credit impaired) €m	Stage 3 (credit impaired) €m	Purchased / originated credit impaired €m	Total €m
Non-forborne loans and advances to customers
Residential mortgages	44,962	2,744	535	111	48,352
Retail Ireland	30,293	2,035	249	111	32,688
Retail UK	14,669	709	286	–	15,664
Non-property SME and corporate	15,442	3,136	311	1	18,890
Republic of Ireland SME	5,642	1,112	245	1	7,000
UK SME	1,218	172	63	–	1,453
Corporate	8,582	1,852	3	–	10,437
Property and construction	3,823	1,971	148	–	5,942
Investment	3,367	1,948	148	–	5,463
Development	456	23	–	–	479
Consumer	4,918	715	148	–	5,781
Total non-forborne loans and advances to customers	69,145	8,566	1,142	112	78,965
Forborne loans and advances to customers
Residential mortgages	5	198	265	27	495
Retail Ireland	4	126	174	27	331
Retail UK	1	72	91	–	164
Non-property SME and corporate	–	1,209	611	–	1,820
Republic of Ireland SME	–	141	115	–	256
UK SME	–	51	24	–	75
Corporate	–	1,017	472	–	1,489
Property and construction	–	942	287	–	1,229
Investment	–	837	237	–	1,074
Development	–	105	50	–	155
Consumer		1	2		3
Total forborne loans and advances to customers	5	2,350	1,165	27	3,547

At 30 June 2024, forborne POCI loans included €3 million (31 December 2023: €1 million) of loans which, while credit-impaired upon purchase or origination, were no longer credit-impaired at the reporting date due to improvement in credit risk. These loans will remain classified as POCI loans until derecognition.

Asset Quality - Loans and advances to customers (continued)

31 December 2023 Loans and advances to customers at amortised cost - Composition	Stage 1 (not credit impaired) €m	Stage 2 (not credit impaired) €m	Stage 3 (credit impaired) €m	Purchased / originated credit impaired €m	Total €m
Non-forborne loans and advances to customers
Residential mortgages	42,781	3,371	542	118	46,812
Retail Ireland	29,361	2,214	231	118	31,924
Retail UK	13,420	1,157	311	–	14,888
Non-property SME and corporate	14,737	3,454	269	1	18,461
Republic of Ireland SME	5,667	991	217	1	6,876
UK SME	1,154	218	49	–	1,421
Corporate	7,916	2,245	3	–	10,164
Property and construction	3,336	2,573	145	–	6,054
Investment	2,934	2,536	145	–	5,615
Development	402	37	–	–	439
Consumer	4,870	800	128	–	5,798
Total non-forborne loans and advances to customers	65,724	10,198	1,084	119	77,125
Forborne loans and advances to customers
Residential mortgages	5	203	228	24	460
Retail Ireland	4	140	152	24	320
Retail UK	1	63	76	–	140
Non-property SME and corporate	–	1,178	811	–	1,989
Republic of Ireland SME	–	153	125	–	278
UK SME	–	95	31	–	126
Corporate	–	930	655	–	1,585
Property and construction	–	945	224	–	1,169
Investment	–	893	175	–	1,068
Development	–	52	49	–	101
Consumer	–	1	2	–	3
Total forborne loans and advances to customers	5	2,327	1,265	24	3,621

Asset Quality - Loans and advances to customers (continued)

Loan to value profiles - total Retail Ireland mortgages

The tables below set out the weighted average indexed loan to value (LTV) for the total Retail Ireland mortgage loan book. The tables include POCI loans of €138 million (31 December 2023: €142 million).

	Owner occupied
30 June 2024 Loan to value ratio of total Retail Ireland mortgages	Stage 1 €m	Stage 2 €m	Stage 3 €m	POCIs €m	Total €m	Stage 1 €m	Stage 2 €m	Buy to let Stage 3 €m	POCIs €m	Total €m	Stage 1 €m	Stage 2 €m	Total Stage 3 €m	POCIs €m	Total €m
Less than 50%	12,821	974	167	58	14,020	838	45	33	5	921	13,659	1,019	200	63	14,941
51% to 70%	9,524	726	104	36	10,390	159	13	9	2	183	9,683	739	113	38	10,573
71% to 80%	3,159	267	22	8	3,456	20	2	3	1	26	3,179	269	25	9	3,482
81% to 90%	3,437	122	10	7	3,576	30	4	5	–	39	3,467	126	15	7	3,615
91% to 100%	266	4	10	5	285	5	–	1	–	6	271	4	11	5	291
Subtotal	29,207	2,093	313	114	31,727	1,052	64	51	8	1,175	30,259	2,157	364	122	32,902
101% to 120%	15	2	8	5	30	4	1	3	1	9	19	3	11	6	39
121% to 150%	10	1	5	6	22	–	–	5	1	6	10	1	10	7	28
Greater than 151%	5	–	14	3	22	4	–	24	–	28	9	–	38	3	50
Subtotal	30	3	27	14	74	8	1	32	2	43	38	4	59	16	117
Total	29,237	2,096	340	128	31,801	1,060	65	83	10	1,218	30,297	2,161	423	138	33,019
Weighted average LTV
Stock of Retail Ireland mortgages at period end					53%					41%					53%
New Retail Ireland mortgages during the period					77%					49%					76%

Weighted average loan to value ratios are calculated at a property level and reflect the average property value in proportion to the outstanding mortgage. Property values are determined by reference to the property valuations held, indexed to the Central Statistics Office (CSO) Residential Property Price Index (RPPI). The indexed LTV profile of the Retail Ireland mortgage loan book is based on the CSO RPPI at April 2024. The CSO RPPI for April 2024 reported that average national residential property prices were 9.6% above peak (October 2023: 5.1% above peak), with Dublin residential prices 1.8% below peak and outside of Dublin residential prices 10.2% above peak (October 2023: 6.3% below peak and 6.1% above peak respectively). In the four months to April 2024, residential property prices at a national level increased by 2.0%.

At 30 June 2024, €32.9 billion or 99.6% of Retail Ireland mortgages were classified as being in positive equity, 99.8% for Owner occupied mortgages and 96.4% for BTL mortgages.

Asset Quality - Loans and advances to customers (continued)

	Owner occupied						Buy to let					Total
31 December 2023 Loan to value ratio of total Retail Ireland mortgages	Stage 1 €m	Stage 2 €m	Stage 3 €m	POCIs €m	Total €m	Stage 1 €m	Stage 2 €m	Stage 3 €m	POCIs €m	Total €m	Stage 1 €m	Stage 2 €m	Stage 3 €m	POCIs €m	Total €m
Less than 50%	11,982	1,060	138	59	13,239	923	17	31	5	976	12,905	1,077	169	64	14,215
51% to 70%	9,371	785	90	37	10,283	183	3	7	2	195	9,554	788	97	39	10,478
71% to 80%	3,208	296	25	10	3,539	28	2	3	1	34	3,236	298	28	11	3,573
81% to 90%	3,325	178	12	7	3,522	36	1	6	1	44	3,361	179	18	8	3,566
91% to 100%	254	4	11	5	274	10	1	2	–	13	264	5	13	5	287
Subtotal	28,140	2,323	276	118	30,857	1,180	24	49	9	1,262	29,320	2,347	325	127	32,119
101% to 120%	16	3	10	5	34	4	1	2	–	7	20	4	12	5	41
121% to 150%	13	1	5	6	25	2	–	5	1	8	15	1	10	7	33
Greater than 151%	5	1	13	3	22	5	1	23	–	29	10	2	36	3	51
Subtotal	34	5	28	14	81	11	2	30	1	44	45	7	58	15	125
Total	28,174	2,328	304	132	30,938	1,191	26	79	10	1,306	29,365	2,354	383	142	32,244
Weighted average LTV
Stock of Retail Ireland mortgages at year end					54%					42%					53%
New Retail Ireland mortgages during the year					75%					55%					74%

Asset Quality - Loans and advances to customers (continued)

Loan to value profiles - total Retail UK mortgages

The tables below sets out the weighted average indexed LTV for the total Retail UK mortgage loan book. Weighted average loan to value ratios are calculated at a property level and reflect the average of property values in proportion to the outstanding mortgage. Property values are determined by reference to the original or latest property valuations held, indexed to the published 'Nationwide UK House Price Index'.

30 June 2024	Standard				Buy to let				Self-certified				Total
Loan to value ratio of total Retail UK mortgages	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m
Less than 50%	1,962	123	36	2,121	1,874	85	64	2,023	320	53	23	396	4,156	261	123	4,540
51% to 70%	2,881	140	35	3,056	1,653	113	93	1,859	199	26	26	251	4,733	279	154	5,166
71% to 80%	1,622	52	10	1,684	233	12	15	260	10	3	3	16	1,865	67	28	1,960
81% to 90%	1,444	44	4	1,492	4	1	2	7	2	–	1	3	1,450	45	7	1,502
91% to 100%	208	7	2	217	1	1	1	3	1	–	1	2	210	8	4	222
Subtotal	8,117	366	87	8,570	3,765	212	175	4,152	532	82	54	668	12,414	660	316	13,390
101% to 120%	1	–	–	1	–	–	1	1	–	1	–	1	1	1	1	3
121% to 150%	1	–	1	2	–	–	1	1	–	–	–	–	1	–	2	3
Greater than 150%	–	–	–	–	–	–	–	–	–	–	1	1	–	–	1	1
Subtotal	2	–	1	3	–	–	2	2	–	1	1	2	2	1	4	7
Total	8,119	366	88	8,573	3,765	212	177	4,154	532	83	55	670	12,416	661	320	13,397
Weighted average LTV
Stock of Retail UK mortgages at period end				62%				50%				45%				58%
New Retail UK mortgages during the period				74%				60%				44%				73%

Asset Quality - Loans and advances to customers (continued)

31 December 2023	Standard				Buy to let				Self-certified				Total
Loan to value ratio of total Retail UK mortgages	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m	Stage 1 £m	Stage 2 £m	Stage 3 £m	Total £m
Less than 50%	1,881	115	37	2,033	1,705	262	67	2,034	330	53	23	406	3,916	430	127	4,473
51% to 70%	2,638	134	39	2,811	1,590	341	95	2,026	214	39	25	278	4,442	514	159	5,115
71% to 80%	1,466	41	15	1,522	272	40	14	326	17	5	4	26	1,755	86	33	1,874
81% to 90%	1,124	21	7	1,152	6	3	2	11	2	–	1	3	1,132	24	10	1,166
91% to 100%	406	5	2	413	1	1	1	3	1	–	1	2	408	6	4	418
Subtotal	7,515	316	100	7,931	3,574	647	179	4,400	564	97	54	715	11,653	1,060	333	13,046
101% to 120%	8	–	–	8	–	–	1	1	2	–	–	2	10	–	1	11
121% to 150%	1	–	1	2	–	–	–	–	–	–	–	–	1	–	1	2
Greater than 150%	–	–	–	–	–	–	–	–	–	–	1	1	–	–	1	1
Subtotal	9	–	1	10	–	–	1	1	2	–	1	3	11	–	3	14
Total	7,524	316	101	7,941	3,574	647	180	4,401	566	97	55	718	11,664	1,060	336	13,060
Weighted average LTV
Stock of Retail UK mortgages at year end				62%				51%				46%				57%
New Retail UK mortgages during the year				75%				60%				52%				73%

Capital adequacy risk

The information below including referenced footnotes forms an integral part of the interim financial statements as described in the basis of preparation in note 1 to the financial statements.

CRD IV - 31 December 20231			CRD IV - 30 June 2024
Regulatory €m	Fully loaded €m		Regulatory €m	Fully loaded €m
		Capital Base
12,561	12,561	Total equity	12,609	12,609
(1,154)	(1,154)	less foreseeable dividend deduction1	(514)	(514)
–	–	less remaining interim profits2	(522)	(522)
(975)	(975)	less AT1 capital	(975)	(975)
10,432	10,432	Total equity less foreseeable dividend deduction, interim profits and equity instruments not qualifying as common equity tier 1	10,598	10,598
(699)	(818)	Regulatory adjustments being phased in / out under CRD IV	(657)	(666)
(736)	(818)	Deferred tax assets3	(666)	(666)
–	–	10% / 15% threshold deduction	–	–
37	–	IFRS 9 transitional adjustment	9	–
(2,097)	(2,097)	Other regulatory adjustments	(2,420)	(2,420)
(153)	(153)	Expected loss deduction	(122)	(122)
(971)	(971)	Intangible assets and goodwill	(1,139)	(1,139)
(583)	(583)	Pension asset deduction	(670)	(670)
(390)	(390)	Other adjustments4	(489)	(489)
7,636	7,517	Common equity tier 1	7,521	7,512
		Additional tier 1
975	975	AT1 instruments (issued by parent entity BoIG plc)	975	975
8,611	8,492	Total tier 1 capital	8,496	8,487
		Tier 2
1,640	1,640	Tier 2 instruments (issued by parent entity BoIG plc)	2,147	2,147
(160)	(160)	Regulatory adjustments	(160)	(160)
1,480	1,480	Total tier 2 capital	1,987	1,987
10,091	9,972	Total capital	10,483	10,474
52.6	52.5	Total risk weighted assets (€bn)	52.2	52.2
		Capital ratios2
14.5%	14.3%	Common equity tier 1	14.4%	14.4%
16.4%	16.2%	Tier 1	16.3%	16.3%
19.2%	19.0%	Total capital	20.1%	20.1%
6.4%	6.3%	Leverage ratio	6.3%	6.3%

1 The December 2023 capital ratios have been presented including the benefit of the retained profit in the period. Under Article 26 (2) of the Capital Requirements Regulation, financial institutions may include independently verified interim profits in their regulatory capital only with the prior permission of the competent authority, namely the ECB, and such permission was obtained. The capital ratios are calculated using unrounded risk weighted asset amounts. As at 31 December 2023, a foreseeable dividend deduction of €1,154 million representing an ordinary dividend of €634 million and share buyback of €520 million was deducted. At June 2024, a foreseeable dividend deduction of €514 million represented an interim ordinary dividend of €352 million and the remainder of the accrual relating to the €520 million 2023 share buyback (€162 million).

²In accordance with ECB guidance and EBA Q&A 2023_6887, no interim profits have been recognised under Article 26(2) of the Capital Requirements Regulation. The interim capital ratios for June 2024 have therefore been presented excluding the benefit of H1 interim profits. Inclusion of H1 interim profits results in a CET1 Ratio of 15.4% and a total capital ratio of 21.1%. ³Deduction relates to deferred tax assets on losses carried forward, net of certain deferred tax liabilities. The deduction was phased at 90% at December 2023, increasing to 100% in 2024. ⁴Includes technical items such as non-qualifying CET1 items, prudential valuation adjustment, calendar provisioning, IFRS 9 addback adjustment, cash flow hedge reserve, own credit spread adjustment (net of tax), coupon expected on AT1 instrument and securitisation deduction.

Capital adequacy risk (continued)

CRD IV - 31 December 2023			CRD IV - 30 June 2024
Regulatory €bn	Fully loaded €bn		Regulatory €bn	Fully loaded €bn
		Risk weighted assets
39.3	39.3	Credit risk	39.0	39.0
0.8	0.8	Counterparty credit risk	0.8	0.8
1.7	1.7	Securitisation	1.9	1.9
0.2	0.2	Market risk	0.2	0.2
5.9	5.9	Operational risk	5.9	5.9
4.7	4.6	Other assets / 10% / 15% threshold deduction	4.4	4.4
52.6	52.5	Total RWAs	52.2	52.2

Risk weighted assets

RWAs on a fully loaded basis, were €52.2 billion at 30 June 2024 (31 December 2023: €52.5 billion). The decrease of €0.3 billion in RWAs is primarily due to the benefit of a credit risk transfer transaction, partially offset by loan growth and the implementation of updates to internal ratings based models. Further details on RWAs can be found in the Group's Pillar 3 disclosures which are available on the Group's website.

CET1 ratio

The Group's proforma fully loaded CET1 ratio with inclusion of the H1 unaudited profits was 15.4% at 30 June 2024 (31 December 2023: 14.3%). The increase of c.110 basis points is primarily due to net organic capital generation (c.+170 basis points), the reduction in RWAs (c.+10 basis points), offset by a foreseeable dividend deduction (c.-70 basis points).

The Group's fully loaded and regulatory CET1 ratios (excluding the H1¹ unaudited profits) were 14.4% at 30 June 2024.

Leverage ratio

The Group's proforma fully loaded leverage ratio with inclusion of the unaudited profits was 6.7% at 30 June 2024 (31 December 2023: 6.3%).

The Group's fully loaded and regulatory leverage ratios, excluding the unaudited profits were 6.3% at 30 June 2024.

A binding leverage requirement of 3% is applicable. The Group expects to remain well in excess of this requirement.

Capital requirements / buffers

The table on the following page sets out the Group's CET1 capital requirements for 30 June 2024 and the authorities responsible for setting those requirements.

The Group is required to maintain a CET1 ratio of 11.33% on a regulatory basis at 30 June 2024. This includes a Pillar 1 requirement of 4.50%, a CET1 Pillar 2 Requirements (P2R) of 1.32%, a Capital Conservation Buffer (CCB) of 2.50%, an Other Systemically Important Institutions (O-SII) Buffer of 1.50% and a Countercyclical buffer of 1.51%. Pillar 2 Guidance (P2G) is not disclosed in accordance with regulatory preference. Countercyclical Capital Buffers (CCyBs) are independently set in each country by the relevant designated authority.

In November 2023, the RoI CCyB increased to 1% from 0.5%. In June 2023, the Central Bank of Ireland (CBI) confirmed the further increase of the CCyB to 1.5% from June 2024. Due to changes in the mix of the book in H1 2024, with a higher concentration in RoI, the RoI CCyB is 0.99%. The UK CCyB is set at 2% resulting in a 0.49% requirement for the Group at 30 June 2024.

The CBI has advised that the Group is required to maintain an O-SII buffer of 1.50% subject to annual review by the CBI.

The Group expects to maintain both fully loaded and regulatory capital ratios significantly in excess of minimum regulatory requirements.

Minimum Requirement for Own Funds and Eligible Liabilities

The Group's interim binding MREL requirements, to be met at 30 June 2024, were 29.26% on a RWAs basis and 7.58% on a leverage basis.

The MREL RWAs requirement consists of a Single Resolution Board (SRB) target of 23.75% (based on the Group's capital requirements at 30 June 2020) and the Group's Combined Buffer Requirement (CBR) of 5.51% on 30 June 2024 (comprising the Capital Conservation Buffer of 2.5% an O-SII buffer of 1.5% and a Countercyclical buffer of 1.51%).

The SRB target is subject to annual review; while the CBR is dynamic, updating as changes in capital requirements become effective.

The Group's proforma MREL position at 30 June 2024 was 35.6% on an RWA basis and 14.9% on a leverage basis (34.6% and 14.5% excluding interim profits). The Group expects to maintain a buffer over its MREL requirements.

¹Post mechanical deduction for EBA Q&A 2023_6887.

Capital adequacy risk (continued)

Pro forma CET1 Regulatory Capital Requirements	Set by	2023	2024	2025
Pillar 1 - CET1	CRR	4.50%	4.50%	4.50%
Pillar 2 Requirement	SSM	1.27%	1.32%	1.32%
Capital Conservation Buffer	CRD	2.50%	2.50%	2.50%
Countercyclical buffer
Ireland (c.66% of RWAs)	CBI	0.63%	0.99%	0.99%
UK (c.24% of RWAs)	BoE	0.50%	0.49%	0.49%
US and other (c.10% of RWA)	Fed / Various	0.03%	0.03%	0.03%
O-SII Buffer	CBI	1.50%	1.50%	1.50%
Pro forma Minimum CET1 Regulatory Requirements		10.93%	11.33%	11.33%

Pillar 2 Guidance Not disclosed in line with regulatory preference

Distribution policy

The Group paid an ordinary dividend in respect of the 2023 financial year of €621 million, equivalent to 60 cents per share, on 11 June 2024. This was paid to shareholders who appeared on the Company's register on 10 May 2024, the record date for the dividend.

In respect of H124, the Board has approved an interim distribution of 35 cents per share, equivalent to €352 million. The interim dividend will be paid on 7 November 2024 to ordinary shareholders who appear on the Company's register on 11 October 2024, the record date for the dividend.

The Group's policy is to distribute ordinary dividends of c.40-60% of statutory profits. The Board will also consider the distribution of surplus capital on at least an annual basis. The distribution level will reflect, amongst other things, the strength of the Group's capital generation, the Board's assessment of the growth and investment opportunities available, any capital the Group retains to cover uncertainties (e.g. related to the economic outlook) and any impact from the evolving regulatory and accounting environments.

Share buyback

The Group commenced a share buyback programme of €520 million on 27 February 2024. At 30 June 2024, 37.46 million shares (equivalent to €358 million) had been repurchased for cancellation, c.3.5% of the count outstanding at 1 January 2024, at a volume weighted average price of €9.558 per share.

Impediments to the transfer of funds

There is a requirement to disclose any impediment to the prompt transfer of funds within the Group. In respect of the Group's licensed subsidiaries, the Group is obliged to meet certain license conditions in respect of capital and / or liquidity.

These requirements may include meeting or exceeding appropriate capital and liquidity ratios and obtaining appropriate regulatory approvals for the transfer of capital or, in certain circumstances, liquidity. The Group's licensed subsidiaries would be unable to remit funds to the parent when to do so would result in such ratios or other regulatory permissions being breached. Apart from this requirement, there is no restriction on the prompt transfer of own funds or the repayment of liabilities between the subsidiary companies and the parent.

At 30 June 2024, own funds were in excess of the required minimum requirement.

Statement of Directors' responsibilities

for the six months ended 30 June 2024

The Directors are responsible for preparing the interim financial report in accordance with the Transparency (Directive 2004/109/EC) Regulations 2007 ('Transparency Directive'), and the Central Bank (Investment Market Conduct) Rules 2019 ('Transparency Rules of the Central Bank of Ireland').

In preparing the consolidated condensed set of financial statements included within the interim financial report, the Directors are required to:

prepare and present the consolidated condensed set of financial statements in accordance with IAS 34 Interim Financial Reporting as adopted by the EU, the Transparency Directive and the Transparency Rules of the Central Bank of Ireland;
ensure the consolidated condensed set of financial statements has adequate disclosures;
select and apply appropriate accounting policies;
make accounting estimates that are reasonable in the circumstances; and
assess the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Those charged with governance are responsible for designing, implementing and maintaining such internal controls as they determine are necessary to enable the preparation of the consolidated condensed set of financial statements that is free from material misstatement whether due to fraud or error.

We confirm that to the best of our knowledge:

The consolidated condensed set of financial statements included within the interim financial report of Bank of Ireland Group plc for the six months ended 30 June 2024 (the 'interim financial information') which comprises the consolidated condensed income statement, consolidated condensed statement of comprehensive income, consolidated condensed balance sheet, consolidated condensed statement of changes in equity, consolidated condensed cash flow statement and the related explanatory notes, have been presented and prepared in accordance with IAS 34, Interim Financial Reporting, as adopted by the EU, the Transparency Directive and Transparency Rules of the Central Bank of Ireland.

The interim financial information presented, as required by the Transparency Directive, includes:

an indication of important events that have occurred during the first six months of the financial year, and their impact on the consolidated condensed set of financial statements;
a description of the principal risks and uncertainties for the remaining six months of the financial year;
related parties' transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or the performance of the Group during that period; and
any changes in the related parties' transactions described in the last annual report that could have a material effect on the financial position or performance of the Group in the first six months of the current financial year.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Group's website. Legislation in the Republic of Ireland governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Signed on behalf of the Board by 30 July 2024

Patrick Kennedy Richard Goulding Myles O'Grady Chairman Deputy Chairman Group Chief Executive Officer

Executive Directors: Myles O'Grady (Group Chief Executive Officer), Mark Spain (Group Chief Financial Officer). Non-Executive Directors: Patrick Kennedy (Chairman), Richard Goulding (Deputy Chairman), Giles Andrews, Akshaya Bhargava, Evelyn Bourke, Ian Buchanan, Eileen Fitzpatrick, Michele Greene, Steve Pateman, Margaret Sweeney.

Independent review report

to the members of Bank of Ireland Group plc

Conclusion

We have been engaged by Bank of Ireland Group plc (the 'Group') to review the Group's condensed set of consolidated financial statements in the half-yearly financial report for the six months ended 30 June 2024 which comprises the consolidated condensed income statement, consolidated condensed statement of comprehensive income, consolidated condensed balance sheet, consolidated condensed statement of changes in equity, consolidated condensed cash flow statement, a summary of material accounting policies and other explanatory notes.

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of consolidated financial statements in the half-yearly financial report for the six months ended 30 June 2024 is not prepared, in all material respects in accordance with International Accounting Standard 34 Interim Financial Reporting ('IAS 34') as adopted by the EU, the Transparency (Directive 2004/109/EC) Regulations 2007 ('Transparency Directive'), and the Central Bank (Investment Market Conduct) Rules 2019 ('Transparency Rules of the Central Bank of Ireland').

Basis for conclusion

We conducted our review in accordance with International Standard on Review Engagements (Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity ("ISRE (Ireland) 2410") issued for use in Ireland. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

We read the other information contained in the half-yearly financial report to identify material inconsistencies with the information in the condensed set of consolidated financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the review. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Conclusions relating to going concern

Based on our review procedures, which are less extensive than those performed in an audit as described in the Basis for conclusion section of this report, nothing has come to our attention that causes us to believe that the Directors have inappropriately adopted the going concern basis of accounting, or that the Directors have identified material uncertainties relating to going concern that have not been appropriately disclosed.

This conclusion is based on the review procedures performed in accordance with ISRE (Ireland) 2410. However, future events or conditions may cause the Group to cease to continue as a going concern, and the above conclusions are not a guarantee that the Group will continue in operation.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly financial report in accordance with the Transparency Directive and the Transparency Rules of the Central Bank of Ireland.

The Directors are responsible for preparing the condensed set of consolidated financial statements included in the half-yearly financial report in accordance with IAS 34 as adopted by the EU.

As disclosed in note 1, the annual financial statements of the Group for the year ended 31 December 2023 are prepared in accordance with International Financial Reporting Standards as adopted by the EU.

In preparing the condensed set of consolidated financial statements, the Directors are responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Our responsibility

Our responsibility is to express to the Group a conclusion on the condensed set of consolidated financial statements in the half-yearly financial report based on our review.

Our conclusion, including our conclusions relating to going concern, are based on procedures that are less extensive than audit procedures, as described in the Basis for conclusion section of this report.

The purpose of our review work and to whom we owe our responsibilities

This report is made solely to the Group in accordance with the terms of our engagement to assist the Group in meeting the requirements of the Transparency Directive and the Transparency Rules of the Central Bank of Ireland. Our review has been undertaken so that we might state to the Group those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Group for our review work, for this report, or for the conclusions we have reached.

KPMG Chartered Accountants, 1 Harbourmaster Place, IFSC Dublin 1, D01 F6F5 Ireland

30 July 2024

Consolidated interim financial statements

and notes (unaudited)

Consolidated condensed income statement

(for the six months ended 30 June 2024) (unaudited)

		6 months ended	6 months ended
		30 June 2024	30 June 2023
	Note	€m	€m
Interest income calculated using the effective interest method	4	2,963	2,470
Other interest income	4	514	420
Interest income		3,477	2,890
Interest expense	5	(1,645)	(1,088)
Net interest income		1,832	1,802
Insurance service result	6	22	26
Insurance revenue		267	247
Insurance service expense		(236)	(216)
Net expense from reinsurance contracts held		(9)	(5)
Insurance investment and finance result	6	(26)	72
Total investment gains		815	619
Finance expense from insurance contracts issued		(819)	(563)
Finance (expense) / income from reinsurance contracts held		(22)	16
Fee and commission income	7	352	327
Fee and commission expense	7	(105)	(110)
Net trading income	8	109	39
Other leasing income	9	53	44
Other leasing expense	9	(42)	(29)
Other operating income	10	42	44
Total operating income		2,237	2,215
Operating expenses	11	(1,100)	(1,031)
Cost of restructuring programme	12	(25)	(12)
Operating profit before impairment losses on financial instruments		1,112	1,172
Net impairment losses on financial instruments	13	(49)	(158)
Operating profit		1,063	1,014
Share of results of associates and joint ventures (after tax)	14	17	11
Profit before tax		1,080	1,025
Taxation charge	15	(203)	(172)
Profit for the period		877	853

Attributable to shareholders		877	849
Attributable to non-controlling interests		–	4
Profit for the period		877	853
Earnings per ordinary share	16	80.8c	74.1c
Diluted earnings per ordinary share	16	80.8c	74.1c

Bank of Ireland Interim Report 2024

Consolidated condensed statement of comprehensive income

(for the six months ended 30 June 2024) (unaudited)

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Profit for the period	877	853
Other comprehensive income, net of tax:
Items that may be reclassified to profit or loss in subsequent periods:
Debt instruments at fair value through other comprehensive income, net of tax	8	1
Cash flow hedge reserve, net of tax	8	(3)
Foreign exchange reserve	74	63
Total items that may be reclassified to profit or loss in subsequent periods	90	61
Items that will not be reclassified to profit or loss in subsequent periods:
Remeasurement of the net defined benefit pension asset, net of tax	95	148
Net change in liability credit reserve, net of tax	(2)	(17)
Total items that will not be reclassified to profit or loss in subsequent periods	93	131
Other comprehensive income for the period, net of tax	183	192
Total comprehensive income for the period, net of tax	1,060	1,045

Total comprehensive income attributable to equity shareholders	1,060	1,041
Total comprehensive income attributable to non-controlling interests	–	4
Total comprehensive income for the period, net of tax	1,060	1,045

The effect of tax on these items is shown in note 15.

Bank of Ireland Interim Report 2024

Consolidated condensed balance sheet

(at 30 June 2024) (unaudited)

	Note	30 June 2024 €m	31 December 2023 €m
Assets
Cash and balances at central banks		32,144	31,843
Items in the course of collection from other banks		143	126
Trading securities		164	72
Derivative financial instruments		3,678	4,341
Fair value changes due to interest rate risk of the hedged items in portfolio hedges		(297)	(124)
Other financial assets at FVTPL		22,472	20,899
Loans and advances to banks		2,259	1,907
Debt securities at amortised cost		5,989	5,715
Financial assets at FVOCI		3,702	3,968
Assets classified as held for sale	17	31	–
Loans and advances to customers	18	81,431	79,729
Interest in associates		108	108
Interest in joint ventures		94	79
Intangible assets and goodwill		1,493	1,408
Investment properties		765	793
Property, plant and equipment		813	800
Current tax assets		6	3
Deferred tax assets	21	665	808
Other assets		1,257	1,127
Reinsurance contract assets	6	1,419	1,414
Retirement benefit assets	26	798	692
Total assets		159,134	155,708
Equity and liabilities
Deposits from banks	22	2,618	3,095
Customer accounts	23	100,795	100,183
Items in the course of transmission to other banks		564	322
Derivative financial instruments		4,552	4,490
Fair value changes due to interest rate risk of the hedged items in portfolio hedges		(1,636)	(1,115)
Debt securities in issue	24	9,606	8,670
Liabilities to customers under investment contracts		8,387	7,692
Insurance contract liabilities	6	16,058	15,113
Other liabilities		2,888	2,480
Leasing liabilities		382	404
Current tax liabilities		29	23
Provisions		56	58
Allowance provision on loan commitments and financial guarantees		64	61
Deferred tax liabilities		60	61
Retirement benefit obligations	26	3	10
Subordinated liabilities	27	2,099	1,600
Total liabilities		146,525	143,147
Equity
Share capital		1,020	1,057
Share premium account		456	456
Retained earnings		10,222	10,285
Other reserves		(52)	(199)
Own shares held for the benefit of life assurance policyholders		(6)	(7)
Shareholders' equity		11,640	11,592
Other equity instruments - Additional Tier 1		966	966
Total equity excluding non-controlling interests		12,606	12,558
Non-controlling interests		3	3
Total equity		12,609	12,561

Total equity and liabilities		159,134	155,708

Consolidated condensed statement of changes in equity

(for the six months ended 30 June 2024) (unaudited)

	Share capital €m					Other reserves			Own shares held for
		Share premium account €m	Retained earnings €m	Debt instruments at FVOCI reserve €m	Cash flow hedge reserve €m	Foreign exchange reserve €m	Capital reserve €m	Other reserves1 €m	benefit of life assurance policyholders €m	Attributable to equity holders of Parent €m	Other equity instruments €m	Non controlling interests €m	Total €m
Balance at 1 January 2024	1,057	456	10,285	(22)	(43)	(757)	593	30	(7)	11,592	966		3 12,561
Profit for the period	–	–	877	–	–	–	–	–	–	877	–	–	877
Other comprehensive income	–	–	95	8	8	74	–	(2)	–	183	–	–	183
Total comprehensive income for the period	–	–	972	8	8	74	–	(2)	–	1,060	–	–	1,060
Transactions with owners
Contributions by and distributions to owners of the Group
Dividends on ordinary shares2	–	–	(621)	–	–	–	–	–	–	(621)	–	–	(621)
Share buyback - repurchase of shares3	–	–	–	–	–	–	–	(358)	–	(358)	–	–	(358)
Share buyback - cancellation of shares3	(37)	–	(358)	–	–	–	37	358	–	–	–	–	–
Distribution paid on other equity instruments - AT1 Coupon	–	–	(34)	–	–	–	–	–	–	(34)	–	–	(34)
Changes in value and amount of shares held	–	–	–	–	–	–	–	–	1	1	–	–	1
Reserve for preference stock to be redeemed	–	–	–	–	–	–	–	–	–	–	–	–	–
Dividends paid to NCI - preference stock	–	–	–	–	–	–	–	–	–	–	–	–	–
Total transactions with owners	(37)	–	(1,013)	–	–	–	37	–	1	(1,012)	–		– (1,012)
Transfer from retained earnings to capital reserve	–	–	(22)	–	–	–	22	–	–	–	–	–	–
Balance at 30 June 2024	1,020	456	10,222	(14)	(35)	(683)	652	28	(6)	11,640	966		3 12,609

¹Other reserves includes the amalgamation of the revaluation reserve €18 million, merger reserve €17 million and liability credit reserve (€7 million).

²In respect of the 2023 financial year, the Bank paid a dividend of €621 million, equivalent to 60 cents per ordinary share.

³The Group commenced a share buyback programme of €520 million on 27 February 2024. At 30 June 2024, 37.46 million shares had been repurchased for cancellation, c.3.5% of the count outstanding at 1 January 2024, at a volume weighted average price of €9.558 per share.

Consolidated condensed statement of changes in equity (continued)

(for the six months ended 30 June 2023) (unaudited)

				Other reserves					Own shares held for
	Share capital €m		Share premium account €m	Retained earnings €m	Debt instruments at FVOCI reserve €m	Cash flow hedge reserve €m	Foreign exchange reserve €m	Capital reserve €m	Other reserves1 €m	benefit of life assurance policyholders €m	Attributable to equity holders of Parent €m	Other equity instruments €m	Non controlling interests €m	Total €m
Balance at 1 January 2023	1,070	456	9,230	(17)	(31)	(786)	527	50	(10)	10,489	966		67 11,522
Profit for the period	–	–	849	–	–	–	–	–	–	849	–	4	853
Other comprehensive income	–	–	148	1	(3)	63	–	(17)	–	192	–	–	192
Total comprehensive income for the period	–	–	997	1	(3)	63	–	(17)	–	1,041	–	4	1,045
Transactions with owners
Contributions by and distributions to owners of the Group
Dividends on ordinary shares	–	–	(225)	–	–	–	–	–	–	(225)	–	–	(225)
Share buyback - repurchase of shares2	–	–	–	–	–	–	–	(125)	–	(125)	–	–	(125)
Share buyback - cancellation of shares2	(14)	–	(125)	–	–	–	14	125	–	–	–	–	–
Reserve for preference stock to be redeemed	–	–	–	–	–	–	–	(57)	–	(57)	–	–	(57)
Distribution paid on other equity instruments - AT1 Coupon	–	–	(34)	–	–	–	–	–	–	(34)	–	–	(34)
Changes in value and amount of shares held	–	–	–	–	–	–	–	–	1	1	–	–	1
Preference stock eliminated on acquisition of Davy	–	–	–	–	–	–	–	–	–	–	–	–	–
Dividends paid to NCI - preference stock	–	–	–	–	–	–	–	–	–	–	–	(4)	(4)
Total transactions with owners	(14)	–	(384)	–	–	–	14	(57)	1	(440)	–	(4)	(444)
Transfer to retained earnings from capital reserve	–	–	(53)	–	–	–	53	–	–	–	–	–	–
Balance at 30 June 2023	1,056	456	9,790	(16)	(34)	(723)	594	(24)	(9)	11,090	966		67 12,123

¹Other reserves includes the amalgamation of the revaluation reserve €24 million, merger reserve €17 million, liability credit reserve (€8 million), and reserve for preference stock to be redeemed of (€57 million).

²In H123, the Group completed the purchase of the €125 million share buyback programme whereby the Group repurchased 13.69 million shares for cancellation, c.1.3% of the count outstanding at 1 January 2023, at a weighted average price of €9.131 per share.

Bank of Ireland Interim Report 2024

Consolidated condensed statement of changes in equity (continued)

(for the year ended 31 December 2023)

						Other reserves			Own shares
	Share capital €m		Share premium account €m	Retained earnings €m	Debt instruments at FVOCI reserve €m	Cash flow hedge reserve €m	Foreign exchange reserve €m	Capital reserve €m	Other reserves1 €m	held for benefit of life assurance policyholders €m	Attributable to equity holders of Parent €m	Other equity instruments €m	Non controlling interests €m	Total €m
Balance at 1 January 2023	1,070	456	9,230	(17)	(31)	(786)	527	50	(10)	10,489	966		67 11,522
Profit for the year	–	–	1,595	–	–	–	–	–	–	1,595	–	6	1,601
Other comprehensive income for the year	–	–	(28)	(5)	(12)	29	–	(20)	–	(36)	–	–	(36)
Total comprehensive income for the year	–	–	1,567	(5)	(12)	29	–	(20)	–	1,559	–	6	1,565
Transactions with owners
Contributions by and distributions to owners of the Group
Distribution paid on other equity instruments - AT1 Coupon	–	–	(69)	–	–	–	–	–	–	(69)	–	–	(69)
Dividends on ordinary shares	–	–	(225)	–	–	–	–	–	–	(225)	–	–	(225)
Share buyback - repurchase of shares2	–	–	–	–	–	–	–	(125)	–	(125)	–	–	(125)
Share buyback - cancellation of shares2	(13)	–	(125)	–	–	–	13	125	–	–	–	–	–
Redemption and buyback of preference stock	–	–	(40)	–	–	–	–	–	–	(40)	–	(64)	(104)
Changes in value and amount of shares held	–	–	–	–	–	–	–	–	3	3	–	–	3
Dividends paid to NCI - preference stock	–	–	–	–	–	–	–	–	–	–	–	(6)	(6)
Total transactions with owners	(13)	–	(459)	–	–	–	13	–	3	(456)	–	(70)	(526)
Transfer from retained earnings to capital reserve	–	–	(53)	–	–	–	53	–	–	–	–	–	–
Balance at 31 December 2023	1,057	456	10,285	(22)	(43)	(757)	593	30	(7)	11,592	966		3 12,561

¹Other reserves includes the amalgamation of the revaluation reserve €18 million, merger reserve €17 million, and liability credit reserve (€5 million).

Bank of Ireland Interim Report 2024

Consolidated condensed cash flow statement

(for the six months ended 30 June 2024) (unaudited)

	Note	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Cash flows from operating activities
Profit before tax		1,080	1,025
Share of results of associates and joint ventures	14	(17)	(11)
Depreciation and amortisation	6,9,11	156	128
Net impairment losses on financial instruments, excluding cash recoveries	13	76	167
Revaluation of investment property		20	39
Interest expense on subordinated liabilities		42	58
Interest expense on lease liabilities	5	5	5
Charge for pension and similar obligations		15	12
Net change in accruals and interest payable		63	101
Net change in prepayments and interest receivable		6	(46)
Charge for provisions		17	3
Non-cash and other items		14	7
Cash flows from operating activities before changes in operating assets and liabilities		1,477	1,488

Net change in items in the course of collection from other banks		225	334
Net change in trading securities		(92)	(6)
Net change in derivative financial instruments		765	(273)
Net change in fair value changes of hedged items in portfolio hedge of interest rate risk		(348)	85
Net change in other financial assets at FVTPL		(1,572)	(1,350)
Net change in loans and advances to banks		109	26
Net change in loans and advances to customers, including held for sale		(1,222)	(8,227)
Net change in other assets		(145)	(145)
Net change in deposits from banks		(541)	89
Net change in customer accounts		235	2,069
Net change in debt securities in issue		978	688
Net change in liabilities to customers under investment contracts		695	326
Net change in insurance and reinsurance contracts		940	866
Net change in other operating liabilities		283	(58)
Net cash flow from operating assets and liabilities		310	(5,576)
Net cash flow from operating activities before tax		1,787	(4,088)
Tax paid		(60)	(38)
Net cash flow from operating activities		1,727	(4,126)

Investing activities (section a below)		(322)	(749)
Financing activities (section b below)		(606)	(416)
Effect of exchange translation and other adjustments		(37)	(70)
Net change in cash and cash equivalents		762	(5,361)
Opening cash and cash equivalents		33,641	39,842
Closing cash and cash equivalents		34,403	34,481

Consolidated condensed cash flow statement (continued)

(for the six months ended 30 June 2024) (unaudited)

Note	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
(a) Investing activities
Additions to debt securities at amortised cost	(410)	(941)
Disposal / redemption of financial assets at FVOCI	254	337
Additions to property, plant and equipment, intangible assets and investment property	(251)	(209)
Disposal / redemption of debt securities at amortised cost	60	88
Proceeds from disposal of property, plant and equipment	20	18
Net change in interest in associates	5	(6)
Additions to financial assets at FVOCI	–	(36)
Cash flows from investing activities	(322)	(749)
(b) Financing activities
Dividend paid to ordinary shareholders	(621)	(225)
Net proceeds from issue of subordinated liabilities 27	498	–
Share buyback - Repurchase of shares	(358)	(125)
Interest paid on subordinated liabilities	(52)	(5)
Distribution on other equity instruments - AT1 coupon	(34)	(34)
Payment of lease liabilities	(34)	(18)
Interest paid on lease liabilities	(5)	(5)
Dividends paid to non-controlling interests - preference stock	–	(4)
Cash flows from financing activities	(606)	(416)

Net cash flows from operating activities in H124 includes interest received of €3,595 million (H123: €2,885 million) and interest paid of €1,355 million (H123: €933 million).

Notes to the consolidated financial statements (unaudited)

1	Group accounting policies	50
2	Critical accounting estimates and judgements	51
3	Operating segments	59
4	Interest income	63
5	Interest expense	64
6	Insurance contracts	64
7	Fee and commission income and expense	67
8	Net trading income	68
9	Other leasing income and expense	69
10	Other operating income	69
11	Other operating expenses	70
12	Cost of restructuring programme	70
13	Net impairment losses on financial instruments	71
14	Share of results of associates and joint ventures (after tax)	71
15	Taxation	72
16	Earnings per share	73
17	Assets classified as held for sale	74
18	Loans and advances to customers	74
19	Credit risk exposures	87
20	Modified financial assets	99
21	Deferred tax	99
22	Deposits from banks	100
23	Customer accounts	101
24	Debt securities in issue	101
25	Contingent liabilities and commitments	102
26	Retirement benefit obligations	103
27	Subordinated liabilities	104
28	Liquidity risk and profile	105
29	Fair values of assets and liabilities	106
30	Post balance sheet events	112
31	Approval of interim report	112

1 Group accounting policies

Basis of preparation

The interim financial statements of the Bank of Ireland Group plc (the 'Company' or 'BoIG plc') and its subsidiaries (collectively the 'Group' or 'BoIG plc Group') for the six months ended 30 June 2024 (H124) have been prepared in accordance with International Accounting Standard (IAS) 34 'Interim Financial Reporting', as issued by the International Accounting Standards Board and as adopted by the European Union. These interim financial statements should be read in conjunction with the Group's audited financial statements for the year ended 31 December 2023, which were prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, and with those parts of the Companies Act 2014 applicable to companies reporting under IFRS and with the European Union (Credit Institutions: Financial Statements) Regulations 2015.

Statutory financial statements

These interim financial statements do not comprise statutory financial statements within the meaning of the Companies Act 2014. The statutory financial statements for the year ended 31 December 2023 were approved by the Board of Directors on 23 February 2024, contained an unqualified audit report and did not include a reference to any matters to which the statutory auditor drew attention by way of emphasis. The statutory financial statements were filed with the Companies Registration Office on 21 June 2024.

Interim financial statements

The interim financial statements comprise the consolidated condensed income statement, consolidated condensed statement of comprehensive income, consolidated condensed balance sheet, consolidated condensed statement of changes in equity, consolidated condensed cash flow statement and the notes to the consolidated interim financial statements. The interim financial statements include the information that is described as being an integral part of the interim financial statements contained in the Asset quality and Capital adequacy risk sections of the OFR.

Going concern

The time period that the Directors have considered in evaluating the appropriateness of the going concern basis in preparing the interim financial statements for H124 is a period of 12 months from the date of approval of these interim financial statements (the 'period of assessment').

In making this assessment, the Directors considered the Group's business, profitability projections, funding and capital plans, together with a range of other factors such as the outlook for the Irish economy, and the current global macroeconomic and geopolitical environment. The matters of primary consideration by the Directors are set out below:

Capital

The Group has developed capital plans under base and stress scenarios and the Directors believe that the Group has sufficient capital to meet its regulatory capital requirements throughout the period of assessment.

Funding and liquidity

The Directors have considered the Group's funding and liquidity position and are satisfied that the Group has sufficient funding and liquidity throughout the period of assessment.

Conclusion

On the basis of the above, the Directors consider it appropriate to prepare the interim financial statements on a going concern basis having concluded that there are no material uncertainties related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern over the period of assessment.

Comparatives

Comparative figures have been adjusted where necessary, to conform with changes in presentation or where additional analysis has been provided in the current period. Any adjustments to comparatives are disclosed in the relevant note or section as appropriate.

Accounting Policies

The accounting policies and methods of computation and presentation applied by the Group in the preparation of these interim financial statements are consistent with those set out on pages 203 to 220 of the Group's 2023 Annual Report, except for the application of the amendments to IAS 1 'Presentation of Financial Statements - Classification of liabilities as current or non-current' and IFRS 16 'Leases - Lease liability in a Sale and Leaseback', with an effective date of 1 January 2024, neither of which had a material impact on the Group.

There have been no other standards, or amendments to standards, adopted by the Group during the six months ended 30 June 2024 which had a material impact on the Group.

2 Critical accounting estimates and judgements

The preparation of interim financial statements requires the Group to make estimates and judgements that impact the reported amounts of assets, liabilities, income and expense. Other than as set out below, there have been no significant changes to the Group's approach to, and methods of, making critical accounting estimates and judgments compared to those applied at 31 December 2023, as set out on pages 221 to 231 of the Group's 2023 Annual Report.

Impairment loss allowance on financial assets

The Group's credit risk methodologies are set out on pages 159 to 164 of the Group's 2023 Annual Report.

Changes in estimates - Forward-looking Information

FLI refers to probability weighted future macroeconomic scenarios approved semi-annually by the Executive Risk Committee and used in the assessment of 'significant increase in credit risk' and in the measurement of impairment loss allowances under IFRS 9. The Group has used four RoI FLI scenarios and four UK FLI scenarios at 30 June 2024, comprising a central scenario, an upside scenario, and two downside scenarios, all extending over a five year forecast period, with reversion to long run averages for property for years beyond the forecast period. The Group keeps under review the number of FLI scenarios and the need to produce projections for other jurisdictions.

The central FLI scenario for the period ending 30 June 2024 was based on internal and external information and management judgement and follows the same process as used in prior periods.

The alternative scenarios, comprised one upside and two downside scenarios, are narrative-driven and have been constructed incorporating available reasonable and supportable information. This was the same approach as used in prior periods.

The FLI methodology framework was leveraged to assign an initial set of probability weightings to the narrative-driven scenarios. The FLI methodology is a simulation tool that uses recent actual observed values and historical data to produce a number of possible paths for the relevant economic variables based on their historical relationships and volatilities. The FLI model is used for scenario generation for a defined probability weighting and for assessing probability weights for a given scenario.

The narrative-driven scenarios were assessed relative to the simulated distribution.

The probability weightings attached to the scenarios are a function of their relative position on the distribution, with a lower probability weighting attached to the scenarios that were assessed to be more distant from the centre of the distribution. The final set of probability weightings used in ECL estimates are less weighted to the downside scenarios than at 31 December 2023 however continue to reflect the application of management judgement to the initial modelled probability weightings with increased weight assigned to the central scenario with an offsetting decrease in the upside scenario weight. External forward-looking information (e.g. external forecasts and equity market indicators) informed the application of this management judgement, and reflected ongoing economic uncertainty at 30 June 2024 associated with a combination of factors including the potential impact of geopolitical risk, elevated interest rates and the expected gradual and uneven path back to lower inflation in the Group's key economies. The estimated ECL impact of this judgement was a c.€6 million increase in reported impairment loss allowance.

The table below shows the mean average forecast values for the key macroeconomic variables under each scenario for the forecast period 2024 to 2028, together with the scenario weightings for both the RoI and the UK.

	Republic of Ireland United Kingdom
			Downside			Downside
30 June 2024	Central scenario	Upside scenario	Scenario 1	Scenario 2	Central scenario	Upside scenario	Scenario 1	Scenario 2
Scenario probability weighting	45%	25%	20%	10%	45%	25%	20%	10%
Modified Domestic Demand - annual growth rate	2.6%	3.2%	1.7%	0.5%	n/a	n/a	n/a	n/a
Gross Domestic Product - annual growth rate	2.9%	3.6%	2.1%	0.8%	1.3%	1.9%	0.5%	(0.5%)
Gross National Product - annual growth rate	2.8%	3.4%	1.8%	0.5%	n/a	n/a	n/a	n/a
Unemployment - average yearly rate	4.6%	3.9%	6.6%	9.2%	4.4%	3.7%	6.3%	8.0%
Residential property price growth - year end figures	2.6%	4.5%	(1.2%)	(3.4%)	2.0%	3.9%	(2.2%)	(4.4%)
Commercial property price growth - year end figures	(0.1%)	2.0%	(3.2%)	(5.3%)	0.4%	2.3%	(2.5%)	(4.8%)

Modified Domestic Demand (MDD) was included for the first time in the HY24 FLI, as the working group concluded that it was required due to the volatility of using Gross Domestic Product (GDP) as a standalone metric. MDD as a measure records spending by consumers, government spending on goods and services and modified investment (removing research and development, traded intellectual property and leased aircraft).

			Republic of Ireland
			Downside				Downside
31 December 2023	Central scenario	Upside scenario	Scenario 1	Scenario 2	Central scenario	Upside scenario	Scenario 1	Scenario 2
Scenario probability weighting	45%	20%	25%	10%	45%	20%	25%	10%
Modified Domestic Demand - annual growth rate	n/a	n/a	n/a	n/a	n/a	n/a	n/a	n/a
Gross Domestic Product - annual growth rate	3.6%	4.2%	2.8%	1.8%	1.3%	1.8%	0.5%	(0.3%)
Gross National Product - annual growth rate	3.8%	4.2%	2.8%	1.7%	n/a	n/a	n/a	n/a
Unemployment - average yearly rate	4.4%	3.8%	6.2%	8.3%	4.6%	3.8%	6.2%	7.9%
Residential property price growth - year end figures	1.0%	2.4%	(2.8%)	(4.8%)	0.6%	1.8%	(2.6%)	(4.6%)
Commercial property price growth - year end figures	(1.2%)	1.6%	(4.3%)	(6.4%)	(0.8%)	1.4%	(4.1%)	(6.0%)

The tables below set out the forecast values for 2024 and 2025 and the average forecast values for the period 2026 to 2028 for the key macroeconomic variables which underpin the mean average values for the period of 2024 to 2028.

	Republic of Ireland			United Kingdom
	2024	2025	2026-2028	2024	2025	2026-2028
Central scenario - 45% weighting
Modified Domestic Demand - annual growth rate	2.0%	2.4%	2.8%	n/a	n/a	n/a
Gross Domestic Product - annual growth rate	1.7%	3.2%	3.2%	0.6%	1.3%	1.5%
Gross National Product - annual growth rate	2.1%	2.9%	3.1%	n/a	n/a	n/a
Unemployment - average yearly rate	4.5%	4.5%	4.7%	4.4%	4.5%	4.4%
Residential property price growth - year end figures	3.5%	3.0%	2.2%	1.0%	1.5%	2.5%
Commercial property price growth - year end figures	(7.0%)	(1.0%)	2.5%	(5.0%)	(0.5%)	2.5%
Upside scenario - 25% weighting
Modified Domestic Demand - annual growth rate	3.1%	3.2%	3.2%	n/a	n/a	n/a
Gross Domestic Product - annual growth rate	3.2%	3.6%	3.7%	1.5%	2.0%	2.1%
Gross National Product - annual growth rate	3.0%	3.4%	3.5%	n/a	n/a	n/a
Unemployment - average yearly rate	4.1%	3.9%	3.8%	3.9%	3.8%	3.6%
Residential property price growth - year end figures	5.5%	5.0%	4.0%	3.0%	3.5%	4.3%
Commercial property price growth - year end figures	(2.5%)	2.5%	3.3%	(0.5%)	2.5%	3.2%
Downside scenario 1 - 20% weighting
Modified Domestic Demand - annual growth rate	0.7%	1.0%	2.3%	n/a	n/a	n/a
Gross Domestic Product - annual growth rate	0.7%	1.8%	2.7%	(0.5%)	(0.3%)	1.1%
Gross National Product - annual growth rate	0.4%	1.5%	2.4%	n/a	n/a	n/a
Unemployment - average yearly rate	5.6%	6.3%	7.0%	5.1%	6.1%	6.7%
Residential property price growth - year end figures	(2.0%)	(5.0%)	0.3%	(6.0%)	(7.0%)	0.7%
Commercial property price growth - year end figures	(12.0%)	(5.0%)	0.3%	(9.5%)	(4.5%)	0.5%
Downside scenario 2 - 10% weighting
Modified Domestic Demand - annual growth rate	(1.4%)	(1.0%)	1.6%	n/a	n/a	n/a
Gross Domestic Product - annual growth rate	(1.2%)	(0.6%)	2.0%	(2.7%)	(2.3%)	0.8%
Gross National Product - annual growth rate	(1.5%)	(0.9%)	1.7%	n/a	n/a	n/a
Unemployment - average yearly rate	6.6%	8.6%	10.2%	6.1%	8.0%	8.7%
Residential property price growth - year end figures	(5.0%)	(9.0%)	(1.0%)	(10.0%)	(11.0%)	(0.3%)
Commercial property price growth - year end figures	(17.0%)	(9.0%)	(0.2%)	(15.5%)	(8.0%)	(0.2%)

The central, upside and downside scenarios are described below for both the RoI and the UK:

Central scenario

RoI

Following a GDP decline in 2023, primarily due to what are likely to be temporary factors which negatively impacted multinational corporation (MNC) exports, growth is expected to return to positive territory in 2024, albeit at a low rate of growth, before picking up towards trend in the 2025-2028 period as export growth rebounds. MDD growth was also subdued last year, mainly as a result of a decline in investment by Multinational Companies, though unlike GDP it remained in positive territory. MDD growth is expected to pick up in 2024 and 2025, as a reduction in inflation pressures supports household real income growth and consumer demand growth should further strengthen over 2026-2028 as investment, including house building, strengthens. Employment growth is expected to remain solid over the forecast horizon, though at lower rates than the past few years, while unemployment is expected to tick up slightly, though remaining low in a historical context.

Key features – Solid growth, declining inflation, low unemployment

UK

Growth was weak in the UK in 2023, with GDP essentially flat on an annual basis, as economic activity was weighed down by high inflation, tight monetary policy and the negative effect of Brexit on trade. The labour market proved resilient though, with unemployment remaining low. Growth is expected to pick up somewhat this year as inflation declines on foot of lower energy and traded goods prices and in turn the Bank of England begins to ease monetary policy. This should boost household spending power and lead to reduced cost pressures for businesses, boosting consumer spending and investment. The rebound is expected to strengthen next year as growth returns to a trend like rate of close to 1.5% and inflation approaches the Bank of England target of 2%. Employment growth is expected to pick-up over the forecast horizon, while the unemployment rate is expected to remain fairly low.

Key features – Solid growth, declining inflation, low unemployment

Upside scenario

In the Upside Scenario, geopolitical tensions ease, leading to a decline in global energy and other commodity prices. This contributes to a more pronounced fall in inflation in Ireland and the UK in the near term, boosting household real (i.e. inflation adjusted) incomes, leading to stronger consumer confidence and spending. The main central banks, including the European Central Bank (ECB) and Bank of England (BoE), initially ease monetary policy to a greater extent than in the Central Scenario, boosting investment and leading to a pickup in global growth and supporting stronger Irish and UK export growth. In addition new technologies such as AI boost productivity growth. Stronger growth in Ireland and the UK pushes unemployment down in both economies and it remains low throughout the forecast period. Stronger growth and lower unemployment eventually leads to a pick-up in inflation pressures in both countries and as a result the monetary easing by the ECB and Bank of England is reversed, with interest rates higher than the Central Scenario later in the forecast period.

Key features – Reducing geopolitical tensions, stronger growth, low unemployment

Downside scenario 1

In Downside Scenario 1, the Russia-Ukraine war intensifies while geopolitical tensions in the Middle-East escalate further, resulting in a rise in global energy and other commodity prices. This, along with a rise in uncertainty due to elections in the UK, the US and elsewhere, leads to a slowdown in world GDP growth. Higher inflation and uncertainty weighs on consumer and business confidence in Ireland and the UK. Monetary and financial conditions tighten as the ECB and Bank of England both respond to higher inflation by delaying monetary easing, and strains in financial markets emerge in response to weaker growth. These factors depress consumer and business spending, while weak global growth is a headwind for exports. As a result GDP (and MDD in Ireland) and employment growth are weaker than in the Central Scenario, particularly in the first few years of the forecast period, leading to a rise in the unemployment rate in both economies. Later in the forecast period inflation falls back as the energy shock fades and the ECB and BoE cut interest rates – as a result growth picks up and unemployment levels off before starting to decline gradually, while the property market stabilises before starting to rebound.

Key features – Escalating geopolitical tensions, higher inflation, weak economic activity, rising unemployment

Downside scenario 2

In Downside Scenario 2, geopolitical tensions escalate significantly, with the Russia-Ukraine war intensifying, a deteriorating situation in the Middle-East resulting in widespread conflict, and also a sharp rise in tensions between the US and China. This leads to a significant rise in global energy and other commodity prices and disrupts global supply chains, pushing up inflation and leading to a decline in global trade. In addition a rise in uncertainty related to elections in the UK, the US and elsewhere weighs on economic activity, while an increase in climate stress leads to a rise in the price of carbon, amplifying inflationary pressures. Central banks, including the ECB and Bank of England, initially keep interest rates high in response to rising inflation. Significant strains in global financial markets emerge and global GDP growth slows sharply. Amid heightened uncertainty, a collapse in consumer and business confidence, tighter monetary, financial and credit conditions, and significantly weaker global demand, which weighs on exports, the Irish and UK economies go into multiyear recessions, with both GDP (and in Ireland's case MDD as well) contracting. The situation is compounded in Ireland due to falling corporate tax revenues and FDI inflows, and in the UK as business investment deteriorates sharply. Unemployment increases sharply in both countries and remains high over the entire forecast period. Eventually the geopolitical situation improves and inflation falls back, allowing the ECB and BoE to cut interest rates significantly. As a result output growth returns to positive territory, picking up towards the end of the forecast horizon, while the property market stabilises before commencing a recovery.

Key features – Severe geopolitical tensions, climate stress, high inflation, recession, elevated unemployment

Property price growth, all scenarios

In the central scenario, having experienced growth later in 2023, RoI house prices are expected to continue to rise with growth of 3.5% in 2024 followed by continued but reducing positive growth in 2024 to 2028, down to 2% by 2027 and 2028. UK house prices saw reduced levels of decline in the latter parts of 2023 due to the recovery of the economy from a technical recession. Growth is expected to return in 2024 with a 1% increase in prices, and this growth will rise to reach 2.5% per annum in 2026 to 2028. Commercial prices in both jurisdictions are expected to see improved negative growth in 2024 and 2025, and after reaching troughs at the end of 2025, growth will return to a level of 3% by 2028. This is driven by a balancing out of supply and demand, new interest in the market in some sectors and greater optimism in sectors like the office sector than in 2023.

In the upside scenario, Irish residential property shows price growth of 5.5% in 2024 before settling down to 4% per annum from 2026 to 2028. In the UK, prices are expected to grow by 3% in 2024, rising over the forecast period until growth of 4.5% is seen in 2027 and 2028. Commercial prices in both jurisdictions will still see initial declines in 2024 before returning to growth in 2025 and remaining positive for the forecast period, both reaching 4% by 2028.

In the downside scenario 1, residential prices are expected to remain negative in 2024-2026 for both RoI and UK with a trough point of -9% and -15% respectively. In downside 2 the declines are more severe with total troughs of -18% for RoI and -25% for UK. For Commercial Real Estate (CRE), Downside 1 will see total value declines over 2024-2026 of -17.5% in RoI and -14.5% in the UK, while for Downside 2 the falls are more severe at -28.5% and -26% respectively over 2024-2027. Following these troughs, Downside 1 returns to low level growth in 2027, and Downside 2 in 2028 in both jurisdictions.

The quantum of impairment loss allowance is impacted by the application of four probability weighted future macroeconomic scenarios. The following table indicates the approximate extent to which the impairment loss allowance at 30 June 2024, excluding post-model management adjustments to impairment loss allowances, was increased by virtue of applying multiple scenarios rather than only a central scenario. This analysis excludes post-model management adjustments, as such adjustments to impairment loss allowance are applied using management judgement outside of the macroeconomic conditioned ECL model framework (refer to the Management judgement in Impairment Measurement section below).

The scenarios outlined in the following tables are based on the FLI weightings outlined on page 52. Changes in the figures at 30 June 2024 compared to 31 December 2023 reflect a number of inter-related dynamics including changes in forward-looking scenarios and associated probability weights; impairment model methodology updates since 31 December 2023; and the composition of the underlying portfolios at the respective reporting dates.

	Additional impairment loss allowance
30 June 2024	Stage 1		Stage 2		Stage 3		Total
Impact of applying multiple scenarios rather than only central scenario	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %
Residential mortgages	4	13%	15	112%	7	5%	26	15%
Retail Ireland	1	4%	9	215%	3	3%	13	12%
Retail UK	3	32%	6	61%	4	10%	13	21%
Non-property SME and corporate	3	5%	28	23%	2	–	33	6%
Property and construction	–	3%	17	35%	2	2%	19	10%
Consumer	3	5%	5	10%	–	–	8	4%
Total	10	6%	65	28%	11	2%	86	8%

	Additional impairment loss allowance
31 December 2023	Stage 1			Stage 2		Stage 3		Total
Impact of applying multiple scenarios rather than only central scenario	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %
Residential mortgages	4	14%	20	70%	11	8%	35	18%
Retail Ireland	2	11%	12	85%	6	6%	20	16%
Retail UK	2	21%	8	55%	5	10%	15	21%
Non-property SME and corporate	5	8%	28	22%	2	1%	35	7%
Property and construction	3	24%	25	30%	2	3%	30	17%
Consumer	3	6%	4	7%	–	–	7	4%
Total	15	10%	77	26%	15	3%	107	10%

The following table indicates the approximate extent to which the impairment loss allowance, excluding post-model management adjustments, would be higher or lower than reported were a 100% weighting applied to the central, upside and downside future macroeconomic scenarios respectively:

30 June 2024 Impact of applying only a central, upside or	Multiple scenarios	Central scenario		Upside scenario		Downside scenario 1		Downside scenario 2
downside scenarios rather than multiple probability weighted scenarios	Impairment loss allowance €m	Impairment loss allowance €m	Impact %	Impairment loss allowance €m	Impact %	Impairment loss allowance €m	Impact %	Impairment loss allowance €m	Impact %
Residential mortgages	201	(26)	(15%)	(40)	(20%)	207	103%	444	221%
Retail Ireland	127	(13)	(12%)	(22)	(17%)	107	84%	221	174%
Retail UK	74	(13)	(21%)	(18)	(24%)	100	135%	223	303%
Non-property SME and corporate	572	(33)	(6%)	(85)	(14%)	97	16%	306	52%
Property and construction	211	(19)	(10%)	(38)	(18%)	39	18%	144	68%
Consumer	185	(8)	(4%)	(22)	(12%)	21	11%	55	30%
Total	1,169	(86)	(8%)	(185)	(16%)	364	31%	949	80%

31 December 2023 Impact of applying only a central, upside or	Multiple scenarios	Central scenario		Upside scenario		Downside scenario 1		Downside scenario 2
downside scenarios rather than multiple probability weighted scenarios	Impairment loss allowance €m	Impairment loss allowance €m	Impact %	Impairment loss allowance €m	Impact %	Impairment loss allowance €m	Impact %	Impairment loss allowance €m	Impact %
Residential mortgages	233	(35)	(18%)	(50)	(22%)	158	68%	289	124%
Retail Ireland	145	(20)	(16%)	(28)	(19%)	84	58%	159	110%
Retail UK	88	(15)	(21%)	(22)	(25%)	74	86%	130	149%
Non-property SME and corporate	535	(35)	(7%)	(84)	(16%)	80	15%	290	54%
Property and construction	200	(30)	(17%)	(63)	(31%)	58	29%	191	95%
Consumer	169	(7)	(4%)	(22)	(13%)	15	9%	51	30%
Total	1,137	(107)	(10%)	(219)	(19%)	311	27%	821	72%

The following table indicates the approximate extent to which impairment loss allowances for the residential mortgage portfolios, excluding post-model management adjustments, would be higher or lower than the application of the central scenario if there was an immediate change in residential property prices at the reporting date. Although such changes would not be observed in isolation, as economic indicators tend to be correlated in a coherent scenario, this gives insight into the sensitivity of the Group's impairment loss allowance to a once-off change in residential property values.

30 June 2024 Impact of an immediate change in residential property prices compared to central scenario impairment loss allowances	Impairment loss allowance - central	Residential property price reduction of 10%		Residential property price reduction of 5%		Residential property price increase of 5%		Residential property price increase of 10%
	scenario €m	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %
Residential mortgages	175	32	18%	15	8%	(13)	(7%)	(24)	(14%)
Retail Ireland	114	15	13%	7	6%	(6)	(6%)	(12)	(10%)
Retail UK	61	17	27%	8	12%	(7)	(11%)	(12)	(19%)

31 December 2023 Impact of an immediate change in residential property prices compared to central	Impairment loss allowance - central	Residential property price reduction of 10%		Residential property price reduction of 5%		Residential property price increase of 5%		Residential property price increase of 10%
scenario impairment loss allowances	scenario €m	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %	Impact €m	Impact %
Residential mortgages	198	39	20%	18	9%	(13)	(7%)	(26)	(13%)
Retail Ireland	126	19	15%	8	6%	(7)	(6%)	(13)	(11%)
Retail UK	72	20	28%	10	14%	(6)	(9%)	(13)	(18%)

The sensitivity of impairment loss allowances to Stage allocation is such that, based on the respective impairment cover ratios, a transfer of 1% of Stage 1 balances at 30 June 2024 to Stage 2 would increase the Group's impairment loss allowance by c.€16 million excluding post-model management adjustments.

Management judgement in impairment measurement

Management judgement has been incorporated into the Group's impairment measurement process for H124. Management judgement can be described with reference to:

credit risk assessment for significant increase in credit risk; • management judgement in impairment model parameters; and
post-model management adjustments to impairment loss allowance and staging classification.

Credit risk assessment for significant increase in credit risk

As outlined in the Risk Management report of the Group's 2023 Annual Report, the Group considers other reasonable and supportable information that would not otherwise be taken into account that would indicate that a significant increase in credit risk had occurred. In this regard, at 30 June 2024, the Group has assessed the impact of elevated inflation and interest rates on asset quality.

Credit risk assessments on the impact of elevated inflation rates and interest rates on debt affordability continued to be implemented across the residential mortgage and consumer portfolios. Where appropriate, outputs have been utilised to identify significant increases in credit risk and the classification of assets in Stage 2. See page 27 of the Asset Quality section for further detail.

The credit risk assessments, which leveraged qualitative information not already captured in impairment models, resulted in a management decision to classify c.€2.0 billion of assets as Stage 2 at the reporting date, with an associated €15 million increase in impairment loss allowance.

Management judgement in impairment model parameters

The calibration of the PD, LGD and EAD components within the model utilised for the Commercial Finance segment of the SME portfolio were enhanced to address model weaknesses, primarily related to LGD estimation and back-testing, identified as part of the Group's internal model validation process. The updates resulted in a c.€8 million increase in impairment loss allowance.

Post-model management adjustment (PMAs)

To ensure that the measurement of impairment reflects reasonable and supportable information that is available without undue cost or effort at the reporting date about past events, current conditions and forecasts of future economic conditions, the need for a PMA to the outputs of the Group's staging and impairment measurement methodologies is considered at each reporting date in arriving at the final impairment loss allowance. Such a need may arise, for example, due to a model / data limitation or a late breaking event.

At 30 June 2024, the Group's stock of impairment loss allowance of €1.3 billion (31 December 2023: €1.2 billion) included an €88 million total PMA (31 December 2023: €85 million). Details of the components of the PMAs are outlined below with a table providing an overview of Group PMAs.

		Post-model Group management adjustment
30 June 2024	Impairment loss allowance before PMAs €m	Investment Property €m	NPEs €m	Retail Ireland Residential Mortgage LGD €m	KBCI potential affordability risk assessment €m	Commercial Finance €m	Total post model adjustments €m	Total impairment loss allowance €m
Residential mortgages	201	–	1	9	4	–	14	215
Retail Ireland	127	–	1	9	4	–	14	141
Retail UK	74	–	–	–	–	–	–	74
Non-property SME and corporate	572	–	11	–	–	2	13	585
Property and construction	211	48	1	–	–	–	49	260
Consumer	185	–	12	–	–	–	12	197
Total loans and advances to customers	1,169	48	25	9	4	2	88	1,257
Other financial instruments	71	–	–	–	–	–	–	71
Total financial assets	1,240	48	25	9	4	2	88	1,328

	Post-model Group management adjustment
31 December 2023	Impairment loss allowance before PMAs €m	Investment Property €m	NPEs €m	Retail Ireland Residential Mortgage LGD €m	KBCI potential affordability risk assessment €m	Commercial Finance €m	Total post model adjustments €m	Total impairment loss allowance €m
Residential mortgages	233	–	–	9	4	–	13	246
Retail Ireland	145	–	–	9	4	–	13	158
Retail UK	88	–	–	–	–	–	–	88
Non-property SME and corporate	535	–	14	–	–	–	14	549
Property and construction	200	48	1	–	–	–	49	249
Consumer	169	–	9	–	–	–	9	178
Total loans and advances to customers	1,137	48	24	9	4	–	85	1,222
Other financial instruments	69	–	–	–	–	–	–	69
Total financial assets	1,206	48	24	9	4	–	85	1,291

Post-model management adjustment for Investment Property

The impact of elevated interest rates on property loans has been separately considered within individual credit assessments in relationship-managed commercial portfolios with the Group taking additional action by maintaining PD downgrades on all US CRE Office property exposures.

Notwithstanding the downgrade of US CRE Office exposures, a PMA to the Group's impairment loss allowance of €48 million has been retained at 30 June 2024 (31 December 2023: €48 million) to reflect ongoing latent risk within certain cohorts of the wider Investment Property portfolio, including prevailing interest rates. The PMA also reflects the estimated impact of planned model enhancements to Investment Property impairment models in 2025.

All of this PMA was recognised in the property and construction portfolio at 30 June 2024 and was allocated to Stage 1 (€7 million) and Stage 2 (€41 million) assets (31 December 2023: Stage 1 (€7 million) and Stage 2 (€41 million) assets respectively.

Post-model management adjustment for NPE

The impairment loss allowance for Stage 3 assets at 30 June 2024 included a €25 million PMA to reflect the potential for the Group to utilise portfolio sales and / or securitisations in its resolution strategies for NPEs in the RoI mortgage, RoI SME (including property and construction), and RoI consumer portfolios (31 December 2023: €24 million).

The Group has identified cohorts of loans with certain characteristics within these portfolios that will likely form part of future portfolio sales and/ or securitisations resulting in derecognition. The quantum of the PMA was calculated with reference to independent external benchmarking, internal impairment cover for these cohorts and an assessment of the likelihood of the completion of future asset sales / securitisations.

The requirement for PMA reflects the fact that individually assessed impairment loss allowances for larger RoI SME assets are determined on a case-specific assessment and do not take account of discounts that may apply for a portfolio sale / securitisation. Similarly modelled LGD parameters for retail and micro-SME portfolios are calibrated based on historical resolution strategies, which were more heavily reliant on caseby-case resolution (e.g. forbearance arrangements, voluntary sales or legal recovery processes).

Almost all of the post-model adjustment was applied to Stage 3 assets. €12 million was recognised in the consumer portfolio (31 December 2023: €9 million); €11 million was related to the RoI SME portfolio (31 December 2023: €14 million), €1 million was related to the property and construction portfolio (31 December 2023: €1 million) and €1 million was related to the RoI mortgage portfolio (31 December 2023: €nil).

Post-model management adjustment for Loss Given

Default in Retail Ireland Residential Mortgage portfolio A €9 million PMA has been recognised to reflect the estimated impact of enhancements to the Retail Ireland residential mortgage impairment models planned in H224 (31 December 2023: €9 million).

Accordingly, the Group considered that it was appropriate to recognise the estimated impact of these enhancements at 30 June 2024. The adjustment was allocated to the Retail Ireland residential mortgage portfolio. The requirement for this adjustment is expected to expire upon implementation of impairment model updates in H224.

Post-model management adjustment for potential affordability risk assessment on acquired KBCI exposures

Credit risk assessments in relation to the impact of elevated inflation and interest rates continue to be implemented across the residential mortgage and consumer portfolios with outputs utilised to identify significant increases in credit risk and reclassify Stage 1 assets to Stage 2.

The KBCI mortgage portfolio acquired by the Group in 2023 has been included in the credit risk assessment at 30 June 2024. Due to lack of historic data on KBCI acquired RoI Mortgage exposures, exposure level identification of cases to transfer to Stage 2 has not been possible. This limitation necessitates that the impact of affordability risk on this acquired cohort is quantified at a portfolio level and applied via a PMA.

Accordingly, the Group considered that it was appropriate to recognise a €4 million PMA which has been applied to Stage 1 assets in the Retail Ireland residential mortgage portfolio (31 December 2023: €4 million). The requirement for this adjustment will be assessed with reference to prevailing economic conditions and assessment of affordability risk in H224.

Post-model management adjustment for Commercial Finance

A new €2 million post-model adjustment has been recognised to reflect the estimated impact of further planned enhancements to the Commercial Finance impairment models within the SME portfolio in H224.

Accordingly, the Group considered that it was appropriate to recognise the estimated impact of these enhancements at 30 June 2024. The adjustment was allocated to the SME portfolio. The requirement for this adjustment is expected to expire upon completion of impairment model updates in H224.

3 Operating segments

The Group has five reportable operating segments which reflect the internal financial and management reporting structure and are organised as follows:

Retail Ireland

Retail Ireland serves its customers delivering day-to-day services, products, propositions and a financial wellbeing programme tailored to meet customers' individual needs. Customers use their preferred channels to request and fulfil their banking requirements. These channels include our branches, 24/7 ATMs, digital, contact centre and our post office partnership for day-to-day banking services.

Wealth and Insurance

Wealth and Insurance includes the Group's life assurance subsidiary New Ireland Assurance Company (NIAC) and Davy, Ireland's leading provider of wealth management and capital markets services. NIAC distributes protection, investment and pension products to the Irish market, across three core channels made up of the Group's distribution channels, independent financial brokers and its own financial advisor network as well as corporate partners. Wealth and Insurance also includes investment markets, and the Group's general insurance brokerage, Bank of Ireland Insurance Services, which offers home, car and travel insurance cover through its agency with insurance providers.

Retail UK

Retail UK incorporates the UK residential mortgage business, the Group's branch network in Northern Ireland (NI), the Group's business banking business in NI, asset finance and contract hire, vehicle leasing and fleet management, incorporating Northridge Finance, as well as the financial services partnership and FX joint venture with the UK Post Office. Our financial services partnership with the Automobile Association (AA) has concluded with the cessation of the provision of unsecured personal loan products. The Group also has a banking business in Great Britain which is being run down. The Retail UK division includes the activities of Bank of Ireland (UK) plc, the Group's wholly owned UK licenced banking subsidiary.

Corporate and Commercial

The Corporate and Commercial division provides a full range of lending, banking and treasury risk management services to the Group's national and international Corporate and Business customers, many of which are at the heart of the Irish economy. Our relationship teams are based in offices in Ireland and the UK with niche international businesses across Europe and in the US. Teams have a wealth of experience across a broad range of segments and sectors, including corporate and business banking, commercial real estate, acquisition finance, foreign direct investment and treasury solutions.

Group Centre

Group Centre incorporates the Group's central support and control functions. Core responsibilities of the function include overseeing the Group wide Customer Strategy, establishing clear governance and control frameworks with appropriate oversight, providing management services to the Group, and managing the key process and IT delivery platforms for the trading divisions.

Other reconciling items

Other reconciling items represent inter segment transactions which are eliminated upon consolidation and the application of hedge accounting at Group level.

Basis of preparation of segmental information

The analysis of results by operating segment is based on the information used by the chief operating decision maker to allocate resources and assess performance. The Group Chief Executive Officer (CEO) and Group Chief Financial Officer (CFO) are considered to be the chief operating decision makers for the Group. The Group's operating segments reflect its organisational and management structures. The CEO and CFO review the Group's internal reporting based around these segments to assess performance and allocate resources. Transactions between the business segments are on normal commercial terms and conditions. Internal charges and transfer pricing adjustments have been reflected in the performance of each business. Revenue sharing agreements are used to allocate external customer revenues to a business segment on a reasonable basis.

The measures of segmental assets and liabilities provided to the chief operating decision maker are not adjusted for transfer pricing adjustments or revenue sharing agreements as the impact on the measures of segmental assets and liabilities is not significant.

Capital expenditure comprises additions to property, plant and equipment and intangible assets.

On an ongoing basis, the Group reviews the methodology for allocating funding and liquidity costs in order to ensure that the allocations continue to reflect each division's current funding requirement.

External revenue comprises interest income, insurance revenue, net income / (expense) from reinsurance contracts held, insurance investment and finance result, fee and commission income, net trading income / (expense), other operating income, other leasing income and share of results of associates and joint ventures.

There were no revenues deriving from transactions with a single external customer that amounted to 10% or more of the Group's revenues.

The Group measures the performance of its operating segments through a measure of segment profit or loss which is referred to as 'Underlying profit or loss' in its internal management reporting systems. Underlying profit or loss excludes the impact of non-core items outlined below:

transformation programme (costs) / credit;
portfolio divestments (net);
acquisition costs;
gross-up for policyholder tax in the Wealth and Insurance business;
liability management exercises; and
investment return on treasury shares held for policyholders.

3 Operating segments (continued)

6 months ended 30 June 2024	Retail Ireland €m	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m	Other reconciling items €m	Group €m
Net interest income	735	(3)	282	786	2	–	1,802
Other income	74	167	5	156	(12)	4	394
Total operating income	809	164	287	942	(10)	4	2,196
Other operating expenses Other operating expenses (before levies and	(208)	(105)	(127)	(244)	(266)	4	(946)
regulatory charges)	(208)	(103)	(125)	(244)	(159)	4	(835)
Levies and regulatory charges	–	(2)	(2)	–	(107)	–	(111)
Depreciation and amortisation	(57)	(12)	(13)	(8)	(35)	(1)	(126)
Total operating expenses	(265)	(117)	(140)	(252)	(301)	3	(1,072)
Underlying operating profit / (loss) before impairment charges on financial instruments	544	47	147	690	(311)	7	1,124
Net impairment (losses) / gains on financial instruments	(4)	–	36	(82)	–	–	(50)
Share of results of associates and joint ventures (after tax)	–	–	12	5	–	–	17
Underlying profit / (loss) before tax	540	47	195	613	(311)	7	1,091

30 June 2024 Reconciliation of underlying profit before tax to profit before tax	Group €m
Underlying profit before tax	1,091
Transformation programme (costs) / credit	(25)
Portfolio divestments (net)	25
Acquisition costs	(19)
Gross-up for policyholder tax in the Wealth and Insurance business	14
Liability management exercises	(4)
Investment losses on treasury shares held for policyholders	(2)
Profit before tax	1,080

3 Operating segments (continued)

Restated1 6 months ended 30 June 2023	Retail Ireland €m1	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m1	Other reconciling items €m	Group €m
Net interest income	656	(4)	327	821	2	–	1,802
Other income	73	188	(1)	147	(14)	6	399
Total operating income	729	184	326	968	(12)	6	2,201
Other operating expenses	(201)	(98)	(132)	(232)	(248)	3	(908)
Other operating expenses (before levies and regulatory charges)	(201)	(98)	(130)	(232)	(140)	3	(798)
Levies and regulatory charges	–	–	(2)	–	(108)	–	(110)
Depreciation and amortisation1	(50)	(9)	(10)	(3)	(36)	(1)	(109)
Total operating expenses	(251)	(107)	(142)	(235)	(284)	2	(1,017)
Underlying operating profit / (loss) before impairment charges on financial instruments	478	77	184	733	(296)	8	1,184
Net impairment (losses) / gains on financial instruments	(64)	–	(63)	(31)	–	–	(158)
Share of results of associates and joint ventures (after tax)	–	–	12	(1)	–	–	11
Underlying profit / (loss) before tax	414	77	133	701	(296)	8	1,037

30 June 2023 Reconciliation of underlying profit before tax to profit before tax	Group €m
Underlying profit before tax	1,037
Transformation programme (costs) / credit	7
Portfolio divestments (net)	–
Acquisition costs	(33)
Gross-up for policyholder tax in the Wealth and Insurance business	14
Liability management exercises	–
Investment losses on treasury shares held for policyholders	–
Profit before tax	1,025

3 Operating segments (continued)

6 months ended 30 June 2024 Income statement analysis by operating segment	Retail Ireland €m	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m	Other reconciling items €m	Group €m
Gross external revenue	733	392	744	1,900	526	(13)	4,282
Inter segment revenues	564	55	35	3,242	844	(4,740)	–
Total revenue	1,297	447	779	5,142	1,370	(4,753)	4,282
Capital expenditure	20	7	69	34	123	–	253

6 months ended 30 June 2023 Income statement analysis by operating segment	Retail Ireland €m	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m	Other reconciling items €m	Group €m
Gross external revenue	659	453	545	1,654	331	27	3,669
Inter segment revenues	290	(21)	122	2,248	540	(3,179)	–
Total revenue	949	432	667	3,902	871	(3,152)	3,669
Capital expenditure	15	13	64	28	90	–	210

30 June 2024 Balance sheet analysis by operating segment	Retail Ireland €m	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m	Other reconciling items €m	Group €m
Total assets	117,624	26,673	26,808	253,438	94,928	(360,337)	159,134
Total liabilities	114,335	25,534	24,429	253,301	89,237	(360,311)	146,525
Investment in associates and joint ventures	28	–	92	80	2	–	202

31 December 2023 Balance sheet analysis by operating segment	Retail Ireland €m	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m	Other reconciling items €m	Group €m
Total assets	112,262	24,683	26,215	248,207	91,921	(347,580)	155,708
Total liabilities	107,260	23,583	24,094	248,711	87,064	(347,565)	143,147
Investment in associates and joint ventures	29	–	77	79	2	–	187

4 Interest income

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Financial assets measured at amortised cost
Loans and advances to customers	2,098	1,822
Loans and advances to banks	645	502
Debt securities at amortised cost	129	76
Interest income on financial assets measured at amortised cost	2,872	2,400
Financial assets at fair value through other comprehensive income
Debt securities at fair value through other comprehensive income	91	70
Interest income on financial assets at fair value through other comprehensive income	91	70
Interest income calculated using the effective interest method	2,963	2,470
Other interest income
Non-trading derivatives (not in hedge accounting relationships - economic hedges)	368	312
Finance leases and hire purchase receivables	140	103
Loans and advances to customers at FVTPL	4	4
Other financial assets at FVTPL	2	1
Other interest income	514	420
Interest income	3,477	2,890

Interest income on loans and advances to customers

In H124, interest income of €53 million was recognised (H123: €62 million) and €57 million was received (H123: €51 million) on credit-impaired loans and advances to customers.

For H124 interest income was reduced by €39 million (H123 €39 million) relating to movements in the acquisition date fair value of derivative financial instruments which economically hedge the performing mortgage book of KBCI acquired by the Group. This partly offsets interest income earned and recognised on these derivative financial instruments.

Interest income recognised on non-trading derivatives

Interest income on non-trading derivatives was earned principally on pay fixed, receive floating interest rate swaps which are held with hedging intent, but for which hedge accounting is not applied. The period on period movement is caused by an increase in interest rates.

5 Interest expense

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Financial liabilities measured at amortised cost
Customer accounts	832	380
Debt securities in issue	287	218
Subordinated liabilities	68	58
Deposits from banks	68	64
Lease liabilities	5	5
Interest expense calculated using the effective interest method	1,260	725
Other interest expense
Non-trading derivatives (not in hedge accounting relationships - economic hedges)	379	359
Customer accounts at FVTPL	6	4
Other interest expense	385	363
Interest expense	1,645	1,088

Interest expense recognised on customer accounts

Interest expense on customer accounts included interest expense of €579 million (H123: €284 million) arising on related derivatives which are in a hedge relationship with the relevant liability. The period on period movement was caused by an increase in interest rates.

Interest expense recognised on non-trading derivatives

Interest expense on non-trading derivatives was earned principally on receive fixed, pay floating interest rate swaps which are held with hedging intent, but for which hedge accounting is not applied. The period on period movement was caused by an increase in interest rates.

6 Insurance contracts

Under IFRS 17, there are three financial statement line items within insurance service result in the income statement which comprises insurance revenue, insurance service expense and net expense from reinsurance contracts held. The insurance finance income or expense is presented separately for both insurance and reinsurance in the notes to the financial statements, and aggregated together with total investment gains as insurance investment and finance result in the income statement. Disclosure is provided for both insurance contracts issued and reinsurance contracts held.

Insurance investment and finance result

The table on the following page comprises the investment gains and losses, realised gains and losses and unrealised gains and losses which accrue to the Group on all investment

assets held by the Wealth and Insurance division (excluding Davy), other than those held for the benefit of policyholders whose contracts are considered to be investment contracts. These instruments are mandatorily measured at FVTPL.

Total investment gains of €815 million in H124 (H123: gains of €619 million) were consistent with positive investment market performance during the period. The gains on the assets held on behalf of the insurance policyholders were consistent with the increase in the insurance contract liabilities.

6 Insurance contracts (continued)

Insurance investment and finance result	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Gains on other financial assets held on behalf of Wealth and Insurance policyholders	815	627
Losses on investment property held on behalf of Wealth and Insurance policyholders	–	(8)
Total investment gains	815	619
Finance expense from insurance contracts issued	(819)	(563)
Finance (expense) / income from reinsurance contracts held	(22)	16
Net insurance and reinsurance finance result	(841)	(547)
Total insurance investment and finance result	(26)	72

Insurance contract liabilities

The reconciliation below has been provided at a total insurance contract liability level. The liability for remaining coverage (LRC) which includes CSM makes up c.96% of this balance, with the liability for incurred claims (LIC) making up the remainder. Included in the total insurance service result is an allocation of depreciation expense of €3 million (H123: €4 million; H223: €7 million) attributable to insurance contracts. Comparative figures are presented for the twelve months ended 31 December 2023.

Insurance contract liabilities	30 June 2024 €m	31 December 2023 €m
Opening liabilities	(15,113)	(13,410)

Insurance revenue	267	518
Expected incurred claims and other expenses	206	394
CSM recognised in income statement for services	40	76
Recovery of insurance acquisition cash flows	14	23
Change in risk adjustment for non-financial risk expired	7	10
Premium variance	–	15
Insurance service expense	(236)	(428)
Incurred claims and other insurance service expenses	(232)	(417)
Changes that relate to past service - adjustment to the LIC	18	14
Insurance acquisition cash flows amortisation	(14)	(23)
Changes that relate to future service - losses on onerous groups of contracts and reversal of such losses	(8)	(2)
Total insurance service result	31	90
Finance expense from insurance contracts issued	(819)	(1,182)
Total amounts recognised in comprehensive income	(788)	(1,092)
Cash flows
Premiums received	(963)	(2,239)
Claims and other directly attributable expenses	776	1,559
Insurance acquisition cash flows	30	69
Total cash flows	(157)	(611)
Closing liabilities	(16,058)	(15,113)

6 Insurance contracts (continued)

Reinsurance contract assets

The reconciliation below has been provided at a total reinsurance contract asset level. The remaining coverage component which includes CSM makes up c.83% of this balance, with the incurred claims component making up the remainder. Comparative figures are presented for the twelve months ended 31 December 2023.

	30 June 2024	31 December 2023
Reinsurance contract assets	€m	€m
Opening assets	1,414	1,352

Net (expense) / income from reinsurance contracts held
Reinsurance expenses	(11)	(20)
Changes in recoveries of losses on onerous underlying contracts	3	(2)
Claims recovered and other directly attributable expenses	(3)	(12)
Changes relating to past service - adjustments to incurred claims	2	(5)
Total net expense from reinsurance contracts held	(9)	(39)
Finance (expense) / income from reinsurance contracts held	(22)	94
Total amounts recognised in comprehensive income	(31)	55
Cash flows
Premiums paid net of ceding commissions and other deferred acquisition costs paid	112	162
Recoveries from reinsurance	(76)	(155)
Total cash flows	36	7
Closing assets	1,419	1,414

Insurance revenue and CSM by transition approach

Under the fair value approach, the CSM or loss component is calculated as the difference between the fair value of a group of insurance contracts, applying IFRS 13 (income approach), and the present value of the fulfilment cash flows (best estimate plus risk adjustment), applying IFRS 17, at the transition date. Comparative figures are presented for the twelve months ended 31 December 2023.

	30 June 2024	31 December 2023
Insurance revenue and CSM by transition approach	€m	€m
Insurance contracts issued
Insurance revenue
Contracts measured using the fair value approach	155	308
New business and all other contracts	112	210
Total insurance revenue	267	518
CSM at period end
Contracts measured using the fair value approach	(626)	(639)
New business and all other contracts	(132)	(110)
Total CSM at period end	(758)	(749)
Reinsurance contracts held
CSM underlying at period end
Underlying contracts measured using the fair value approach	180	182
New business and all other underlying contracts	(22)	(22)
Total CSM underlying at period end	158	160

6 Insurance contracts (continued)

Insurance CSM

The reconciliation below gives a total view of the movement of the insurance contractual service margin. Comparative figures are presented for the twelve months ended 31 December 2023.

Insurance contractual service margin	30 June 2024 €m	31 December 2023 €m
Opening insurance contract CSM	(749)	(690)
CSM recognised for services provided	40	76
Changes in estimates that adjust the CSM	(39)	(110)
Contracts initially recognised in the period	(9)	(25)
Finance income from insurance contracts issued	(1)	–
Closing insurance contract CSM	(758)	(749)

Reinsurance CSM

The reconciliation below gives a total view of the movement of the reinsurance contractual service margin. Comparative figures are presented for the twelve months ended 31 December 2023.

Reinsurance contractual service margin	30 June 2024 €m	31 December 2023 €m
Opening reinsurance contract CSM	160	137
CSM recognised for services provided	(8)	(14)
Changes in estimates that adjust the CSM	7	49
Contracts initially recognised in the period	(4)	(10)
Changes in recoveries of losses on onerous underlying contracts that adjust CSM	3	(2)
Closing reinsurance contract CSM	158	160

A total of €32 million (H123: €30 million; H223: €32 million) was released from the CSM for services provided. The release represents services provided on insurance contracts offset with services provided on reinsurance contracts.

7 Fee and commission income and expense

6 months ended 30 June 2024 Income	Retail Ireland €m	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m	Group €m
Retail banking customer fees	98	–	16	103	–	217
Asset management fees	–	81	–	–	–	81
Credit related fees	2	–	1	9	–	12
Insurance commissions	–	5	–	–	–	5
Other	8	11	2	16	–	37
Fee and commission income	108	97	19	128	–	352

Fee and commission income and expense included €95 million (H123: €78 million) arising from trust and other fiduciary duties.

7 Fee and commission income and expense (continued)

6 months ended 30 June 2023 Income	Retail Ireland €m	Wealth and Insurance €m	Retail UK €m	Corporate and Commercial €m	Group Centre €m	Group €m
Retail banking customer fees	95	–	17	103	–	215
Asset management fees	–	66	–	–	–	66
Credit related fees	1	–	1	4	–	6
Insurance commissions	–	5	–	–	–	5
Other	5	11	3	16	–	35
Fee and commission income	101	82	21	123	–	327

Expense

Fee and commission expense of €105 million (H123: €110 million) primarily comprised brokerage fees, sales commissions and other fees paid to third parties.

8 Net trading income

Net trading income includes the gains and losses on financial instruments mandatorily measured at FVTPL and those designated at FVTPL (other than unit-linked life assurance assets and investment contract liabilities). It includes the fair value movement on these instruments and the realised gains and losses arising on the purchase and sale. It also includes the interest income receivable and expense payable on financial instruments held for trading and €10 million of a net gain arising from FX (H123: net gain €9 million).

It does not include interest income on debt financial assets mandatorily measured at FVTPL, interest expense on financial liabilities designated at FVTPL and interest income or expense on derivatives that are held with hedging intent, but for which hedge accounting is not applied (economic hedges).

Net income from financial instruments mandatorily measured at FVTPL includes dividend income from equities, realised and unrealised gains and losses.

Net fair value hedge ineffectiveness reflected a net gain from hedged items of €319 million (H123: net loss €37 million) offsetting a net loss from hedging instruments of €319 million (H123: net gain €39 million).

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Net income from financial instruments designated at FVTPL
Financial liabilities designated at fair value	(9)	(45)
Related derivatives held for trading	13	47
	4	2
Net income from financial instruments mandatorily measured at FVTPL
Other financial instruments held for trading	86	19
Securities and non-trading debt	16	13
Loans and advances	3	3
	105	37
Net fair value hedge ineffectiveness	–	2
Net trading income	109	39

9 Other leasing income and expense

Other leasing income and expense relates to the business activities of Marshall Leasing, which is a car and commercial leasing and fleet management business based in the UK. This business is conducted through N.I.I.B Group Limited, a wholly-owned subsidiary of Bank of Ireland (UK) plc, whose ultimate parent is the Group.

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Other leasing income	53	44
Operating lease payments	31	27
Sale of leased assets	19	15
Other income	3	2
Other leasing expense	(42)	(29)
Depreciation of rental vehicles	(24)	(16)
Other selling and disposal costs	(18)	(13)
Net other leasing income	11	15

10 Other operating income

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Other insurance income	41	46
Loss on liability management exercises	(4)	–
Elimination of investment losses on treasury shares held for the benefit of policyholders in the Wealth and Insurance business	(1)	–
Other income	6	(2)
Other operating income	42	44

Other insurance income relates to investment classified business in the Wealth and Insurance division consisting of investment business income, change in policyholder investment contract liabilities and actual investment premiums and claims.

At 30 June 2024, expenses of €4 million (H123: €nil) were incurred as part of a liability management exercise undertaking to repurchase certain Group perpetual non-call instruments.

11 Other operating expenses

Administrative expenses and staff costs	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Staff costs excluding transformation programme staff costs	491	454
Levies and regulatory charges	111	110
Amortisation of intangible assets	97	75
Depreciation of property, plant and equipment	32	37
Other administrative expenses	369	355
Total	1,100	1,031
Total staff costs are analysed as follows: Wages and salaries	423	389
Social security costs	45	41
Retirement benefit costs (defined contribution plans)	29	24
Retirement benefit costs (defined benefit plans)	13	2
Other staff expenses	7	20
	517	476
Staff costs capitalised	(26)	(22)
Staff costs excluding transformation programme staff costs	491	454
Staff costs included in transformation programme costs (note 12)	17	7
Total staff costs recognised in the income statement	508	461

Pension costs

Pension costs of €42 million for H124 were €16 million higher than H123. Defined benefit pension costs have increased by €11 million. Pension costs included a negative past service cost of €5 million relating to the Life Balance UK pension scheme (H123: €17 million). New joiners are added to the Group's defined contribution plans, the cost of which has increased by €5 million compared to H123.

Staff numbers

At 30 June 2024, the number of staff (full time equivalents (FTE)) for the Group was 11,180 (30 June 2023: 10,511). The average number of staff (FTE) for the Group for the 6 months ended 30 June 2024 was 11,053 (6 months ended 30 June 2023: 10,356).

12 Cost of restructuring programme

In H124, the Group recognised a restructuring charge of €25 million (H123: €12 million).

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Transformation programme costs
Staff costs	17	7
UK strategic review costs	4	3
Programme management costs	3	2
Property-related costs	1	–
Total	25	12

13 Net impairment losses on financial instruments

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Loans and advances to customers at amortised cost	(46)	(156)
Movement in impairment loss allowance (note 18)	(73)	(167)
Cash recoveries	27	11
Loan commitments	(4)	(5)
Guarantees and irrevocable letters of credit	1	2
Other financial assets	–	1
Net impairment losses on financial instruments	(49)	(158)

Net impairment losses on loans and advances to customers at amortised cost

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Residential mortgages	39	(86)
Retail Ireland	23	(50)
Retail UK	16	(36)
Non-property SME & corporate	(45)	(10)
Republic of Ireland SME	(42)	22
UK SME	21	1
Corporate	(24)	(33)
Property and construction	(9)	(18)
Investment	(8)	(22)
Development	(1)	4
Consumer	(31)	(42)
Total	(46)	(156)

14 Share of results of associates and joint ventures (after tax)

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
First Rate Exchange Services	12	12
Associates	5	(1)
Share of results of associates and joint ventures (after tax)	17	11

15 Taxation

The taxation charge for the period was €203 million with an effective statutory taxation rate of 19% (H123: taxation charge of €172 million and taxation rate of 17%). The effective tax rate was influenced by changes in the jurisdictional mix of profits and losses.

Recognised in income statement	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Current tax
Irish Corporation Tax
Current period	18	9
Adjustments in respect of prior period	(1)	–
Foreign tax Current period	56	47
Adjustments in respect of prior period Current tax charge1	2 75	4 60
Deferred tax
Current period profits	125	95
Origination and reversal of temporary differences	2	13
Adjustments in respect of prior period	1	4
Deferred tax charge	128	112
Taxation charge	203	172

Reconciliation of tax on the profit before taxation at the standard Irish corporation tax rate to actual tax charge	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Profit before tax multiplied by the standard rate corporation tax in Ireland of 12.5% (2023: 12.5%)	135	128
Effects of:
Foreign earnings subject to different rates of tax	39	32
Non-deductible Irish Bank Levy	10	2
Adjustments in respect of prior period	2	8
Share of results of associates and joint ventures shown post tax in the income statement	(2)	(2)
Other adjustments for tax purposes	19	4
Taxation charge	203	172

¹The Group is within the scope of the Organisation for Economic Co-operation and Development (OECD) 15% minimum effective tax rate Model Rules (Pillar 2). However, the impact of Pillar 2 on the current tax charge in the current period is insignificant due primarily to the ability to take into account certain historic tax losses in the Bank at 15% and also due to profits arising in jurisdictions with an effective tax rate in excess of 15%. See note 21 for further details.

15 Taxation (continued)

	6 months ended 30 June 2024			6 months ended 30 June 2023
Analysis of selected other comprehensive income	Pre-tax €m	Tax €m	Net of Tax €m	Pre-tax €m	Tax €m	Net of Tax €m
Debt instruments at FVOCI reserve
Changes in fair value	9	(1)	8	1	–	1
Transfer to income statement - asset disposal	–	–	–	–	–	–
Net change in debt instruments at FVOCI reserve	9	(1)	8	1	–	1
Remeasurement of the net defined benefit pension asset	110	(15)	95	169	(21)	148
Cash flow hedge reserve
Changes in fair value	(256)	35	(221)	(345)	27	(318)
Transfer to income statement	265	(36)	229	342	(27)	315
Net change in cash flow hedge reserve	9	(1)	8	(3)	–	(3)
Net change in foreign exchange reserve	74	–	74	63	–	63
Liability credit reserve
Changes in fair value of liabilities designated at FVTPL due to own credit risk	(2)	–	(2)	(19)	2	(17)
Other comprehensive income for the period	200	(17)	183	211	(19)	192

16 Earnings per share

The calculation of basic earnings per ordinary share is based on the profit attributable to ordinary shareholders divided by the weighted average number of ordinary shares in issue excluding treasury shares.

Diluted earnings per share is based on the profit attributable to ordinary shareholders divided by the weighted average number of ordinary shares in issue excluding treasury shares adjusted for the effect of all dilutive potential ordinary shares.

For H124 and H123, there was no difference in the weighted average number of units of share used for basic and diluted earnings per share.

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Basic and diluted earnings per share
Profit attributable to shareholders	877	849
Distributions on other equity instruments - AT1 coupon	(34)	(34)
Adjustment for redemption of preference stock1	–	(24)
Profit attributable to ordinary shareholders	843	791
	Shares	Shares
Weighted average number of shares in issue excluding treasury shares (millions)	1,043	1,067
Basic and diluted earnings per share (cent)	80.8	74.1

1 In H123, the Group recognised a financial liability of €57 million in respect of a commitment to redeem certain Sterling and Euro preference stock of The Governor and Company of the Bank of Ireland. This liability was in excess of the carrying value (c.€33million) of the related preference stock, which was presented as non-controlling interest by the Group. Under IAS 33, the difference of €24 million was reflected in the EPS calculation by reducing the profit attributable to ordinary shareholders of the Group.

17 Assets classified as held for sale

At 30 June 2024, the Group is in the process of disposing of a portfolio of mortgages and an investment property. These transactions are as follows:

Retail UK is in the process of disposing of a small portfolio of UK mortgages. As a result, these assets have been reclassified from loans and advances to customers to assets classified as held for sale. The assets continue to be measured at amortised cost using the effective interest rate method of €20 million.
Wealth and Insurance is in the process of disposing of an investment property, which was originally held for the benefit of policyholders. As a result, this asset has been reclassified from investment properties to assets classified as held for sale. The asset is measured at its fair value of €11 million.

	30 June 2024 €m	31 December 2023 €m
Assets classified as held for sale
Retail UK mortgage portfolio	20	–
Wealth and Insurance investment property	11	–
Total	31	–

18 Loans and advances to customers

Loans and advances to customers at amortised cost

Loans and advances to customers at amortised cost in the tables below include a UK mortgage portfolio of €20 million which was deemed to be held for sale at 30 June 2024, these assets were reclassified on the balance sheet from loans and advances to customers to assets classified as held for sale. Further details can be found in note 17.

In H123, the Group completed the KBCI portfolio acquisition. The Group acquired performing and non-performing mortgages with a nominal value of €7.9 billion, commercial and consumer loans of €0.1 billion and customer deposits of €1.8 billion (Note 23) as at the balance sheet acquisition date of 3 February 2023.

Loans and advances to customers at amortised cost (after impairment loss allowance) at 30 June 2024 included cash collateral of €76 million (31 December 2023: €45 million) placed with derivative counterparties in relation to net derivative liability positions.

At 30 June 2024, loans and advances to customers at amortised cost included gross carrying amounts of €7.4 billion (31 December 2023: €6.5 billion) of RoI green mortgages, €1.3 billion (31 December 2023: €1.3 billion) of UK green mortgages, €1.9 billion (31 December 2023: €1.7 billion) of green commercial real estate lending, €1.4 billion (31 December 2023: €1.2 billion) of sustainability-linked loans, €0.3 billion (31 December 2023: €0.3 billion) of renewables project finance, and €0.2 billion (31 December 2023: €0.1 billion) of electric vehicles funding.

Loans and advances to customers at FVTPL

Loans and advances to customers at FVTPL are not subject to impairment under IFRS 9. At 30 June 2024, loans and advances to customers at FVTPL included €196 million (31 December 2023: €205 million) relating to the Life Loan mortgage product, which was offered by the Group until November 2010. The cash flows of the Life Loans are not considered to consist solely of payments of principal and interest, and as such are classified as FVTPL.

	30 June 2024 €m	31 December 2023 €m
Loans and advances to customers at amortised cost	78,009	76,558
Finance leases and hire purchase receivables	4,503	4,188
	82,512	80,746
Less allowance for impairment charges on loans and advances to customers	(1,257)	(1,222)
Loans and advances to customers at amortised cost	81,255	79,524
Loans and advances to customers at FVTPL	196	205
Total loans and advances to customers	81,451	79,729

The following tables show the gross carrying amount and impairment loss allowances subject to 12 month and lifetime ECL on loans and advances to customers at amortised cost. The POCI assets of €139 million at 30 June 2024 (31 December 2023: €143 million) included €56 million (31 December 2023: €25 million) of assets which, while credit-impaired upon purchase or origination were no longer credit-impaired at the reporting date due to improvements in credit risk. These assets will remain classified as POCI until derecognition.

30 June 2024 Gross carrying amount at amortised cost (before impairment loss allowance)	Residential mortgages €m	Non property SME and corporate €m	Property and construction €m	Consumer €m	Total €m
Stage 1 - 12 month ECL (not credit-impaired)	44,967	15,442	3,823	4,918	69,150
Stage 2 - Lifetime ECL (not credit-impaired)	2,942	4,345	2,913	716	10,916
Stage 3 - Lifetime ECL (credit-impaired)	800	922	435	150	2,307
Purchased / originated credit-impaired	138	1	–	–	139
Gross carrying amount at 30 June 2024	48,847	20,710	7,171	5,784	82,512

30 June 2024 Impairment loss allowance	Residential mortgages €m	Non property SME and corporate €m	Property and construction €m	Consumer €m	Total €m
Stage 1 - 12 month ECL (not credit-impaired)	35	77	20	57	189
Stage 2 - Lifetime ECL (not credit-impaired)	41	154	108	52	355
Stage 3 - Lifetime ECL (credit-impaired)	141	354	132	88	715
Purchased / originated credit-impaired	(2)	–	–	–	(2)
Impairment loss allowance at 30 June 2024	215	585	260	197	1,257

31 December 2023 Gross carrying amount at amortised cost (before impairment loss allowance)	Residential mortgages €m	Non property SME and corporate €m	Property and construction €m	Consumer €m	Total €m
Stage 1 - 12 month ECL (not credit-impaired)	42,786	14,737	3,336	4,870	65,729
Stage 2 - Lifetime ECL (not credit-impaired)	3,574	4,632	3,518	801	12,525
Stage 3 - Lifetime ECL (credit-impaired)	770	1,080	369	130	2,349
Purchased / originated credit-impaired	142	1	–	–	143
Gross carrying amount at 31 December 2023	47,272	20,450	7,223	5,801	80,746

31 December 2023 Impairment loss allowance	Residential mortgages €m	Non property SME and corporate €m	Property and construction €m	Consumer €m	Total €m
Stage 1 - 12 month ECL (not credit-impaired)	40	65	25	50	180
Stage 2 - Lifetime ECL (not credit-impaired)	56	154	144	67	421
Stage 3 - Lifetime ECL (credit-impaired)	141	330	80	61	612
Purchased / originated credit-impaired	9	–	–	–	9
Impairment loss allowance at 31 December 2023	246	549	249	178	1,222

The following tables show the changes in gross carrying amount and impairment loss allowances of loans and advances to customers at amortised cost for H124 and the year ended 31 December 2023. The tables are prepared based on a combination of aggregation of monthly movements for material term loan portfolios (i.e. incorporating all movements a loan in these portfolios has made during the period) and full year movements for revolving-type facilities and less material (primarily consumer) portfolios.

Transfers between stages represent the migration of loans from Stage 1 to Stage 2 following a 'significant increase in credit risk' or to Stage 3 as loans enter defaulted status. Conversely, improvement in credit quality and loans exiting default result in loans migrating in the opposite direction. The approach taken to identify a 'significant increase in credit risk' and identifying defaulted and credit-impaired assets is outlined in the credit risk section of the Risk Management Report on pages 162 to 163 of the Group's 2023 Annual Report with updates for 2024 outlined in the asset quality section of the OFR on page 27.

Transfers between each stage reflect the balances and impairment loss allowances prior to transfer. The impact of remeasurement of impairment loss allowance on stage transfer is reported within 're-measurement' in the new stage that a loan has transferred into. For those tables based on an aggregation of the months transfers between stages, transfers may include loans which have subsequently transferred back to their original stage or migrated further to another stage.

'Net changes in exposure' comprise the movements in the gross carrying amount and impairment loss allowance as a result of new loans originated and repayments of outstanding balances throughout the reporting period.

'Net impairment losses in income statement' does not include the impact of cash recoveries which are recognised directly in the income statement (note 13).

'Re-measurements' includes the impact of remeasurement on stage transfers noted above, other than those directly related to the update of FLI and / or other model and parameter updates, changes in management adjustments and remeasurement due to changes in asset quality that did not result in a transfer to another stage.

ECL model parameter and / or methodology changes represents the impact on impairment loss allowances of semiannual updates to the FLI, and other model and parameter updates used in the measurement of impairment loss allowances, including the impact of stage migrations where the migration is directly related to the update of FLI and / or other model and parameter updates.

'Impairment loss allowances utilised' represents the reduction in the gross carrying amount and associated impairment loss allowance on loans where the Group has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. The utilisation of an allowance does not, of itself, alter a customer's obligations nor does it impact on the Group's rights to take relevant enforcement action.

30 June 2024 Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2024	65,729	12,525	2,349	143	80,746
Total net transfers	98	(350)	252	–	–
To 12 month ECL (not credit-impaired)	4,135	(4,133)	(2)	–	–
To lifetime ECL (not credit-impaired)	(3,956)	4,329	(373)	–	–
To lifetime ECL (credit-impaired)	(81)	(546)	627	–	–
Net changes in exposure	2,657	(1,405)	(247)	(4)	1,001
Impairment loss allowances utilised	–	–	(79)	–	(79)
Exchange adjustments	601	144	31	–	776
Measurement reclassification and other movements	65	2	1	–	68
Gross carrying amount at 30 June 2024	69,150	10,916	2,307	139	82,512

Impairment loss allowances utilised on loans and advances to customers at amortised cost during H124 included €37 million of contractual amounts outstanding that are still subject to enforcement activity.

30 June 2024 Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2024	180	421	612	9	1,222
Total net transfers	79	(97)	18	–	–
To 12 month ECL (not credit-impaired)	101	(100)	(1)	–	–
To lifetime ECL (not credit-impaired)	(21)	70	(49)	–	–
To lifetime ECL (credit-impaired)	(1)	(67)	68	–	–
Net impairment losses / (gains) in income statement	(73)	27	131	(12)	73
Re-measurement	(75)	109	192	(9)	217
Net changes in exposures	(2)	(46)	(48)	–	(96)
ECL model parameter and / or methodology changes	4	(36)	(13)	(3)	(48)
Impairment loss allowances utilised	–	–	(79)	–	(79)
Exchange adjustments	3	3	–	–	6
Measurement reclassification and other movements	–	1	33	1	35
Impairment loss allowance at 30 June 2024	189	355	715	(2)	1,257
Impairment coverage at 30 June 2024 (%)	0.27%	3.25%	30.99%	(1.44%)	1.52%

Total gross loans and advances to customers increased during the period by €1.8 billion from €80.7 billion at 31 December 2023 to €82.5 billion at 30 June 2024.

Stage 1 loans have increased by €3.4 billion primarily reflecting the impact of net new lending of €2.7 billion, FX movements of €0.6 billion and other movements of €0.1 billion. Total net transfers from other risk stages (primarily Stage 2) reflect revisions to the underlying affordability thresholds used in the credit risk assessment (as outlined on page 27 of the Asset Quality Section), updates for FLI weightings and other portfolio activity in the period.

Impairment loss allowances (ILAs) on Stage 1 loans have increased by €9 million with coverage on Stage 1 loans 0.27% unchanged from 31 December 2023. Net staging transfers resulted in an increase to ILA of €79 million with model parameter changes €4 million and FX movements €3 million resulting in further increases to ILA in the period. This was largely offset by remeasurement reclassifications of €75 million reflecting the impact of re-measuring net transfers from other stages of lifetime ECL to 12-month ECL.

Stage 2 loans have decreased by €1.6 billion primarily reflecting net repayments of €1.4 billion and transfers to other stages of €0.3 billion, partially offset by FX movements of €0.1 billion. Net transfers to other stages reflects the updated credit risk assessments mentioned above and other portfolio activity in the period.

Coverage on Stage 2 loans has decreased from 3.36% at 31 December 2023 to 3.25% at 30 June 2024 primarily due to the impact of net transfers €97 million, net repayments €46 million and ECL model parameter and methodology changes €36 million, offset by re-measurement €109 million.

Stage 3 loans have decreased by €0.04 billion with the key drivers being impact of net repayments of €0.2 billion (including repayments from case specific resolution activities) and the utilisation of impairment loss allowances of €0.1 billion, largely offset by a net migration from other stages of €0.3 billion driven by the emergence of new defaults for case specific reasons.

Stage 3 ILAs have increased by €103 million due to the impact of remeasurement of €192 million, which includes application of an increased post-model adjustment for potential NPE portfolio resolutions (see pages 57 and 58), measurement reclassifications and other movements of €33 million and net transfers from other stages of €18 million, partially offset by the utilisation of impairment loss allowances of €79 million, and the impact of net reductions in exposure of €48 million.

Cover on Stage 3 loans has increased from 26.05% at 31 December 2023 to 30.99% at 30 June 2024. The increase primarily reflects changes in the underlying asset / portfolio mix of the Stage 3 population with higher than average impairment requirements for assets migrating to Stage 3 in the period and the resolution of several existing Stage 3 assets with lower than average ILA cover.

31 December 2023 Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2023	57,831	12,643	2,485	80	73,039
Total net transfers	(3,885)	2,732	1,153	–	–
To 12 month ECL (not credit-impaired)	8,481	(8,475)	(6)	–	–
To lifetime ECL (not credit-impaired)	(12,096)	12,552	(456)	–	–
To lifetime ECL (credit-impaired)	(270)	(1,345)	1,615	–	–
Net changes in exposure	11,190	(2,872)	(768)	110	7,660
Impairment loss allowances utilised	–	–	(526)	(48)	(574)
Exchange adjustments	343	12	5	1	361
Measurement reclassification and other movements	250	10	–	–	260
Gross carrying amount at 31 December 2023	65,729	12,525	2,349	143	80,746

31 December 2023 Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2023	142	285	835	33	1,295
Total net transfers	93	(120)	27	–	–
To 12 month ECL (not credit-impaired)	147	(145)	(2)	–	–
To lifetime ECL (not credit-impaired)	(50)	133	(83)	–	–
To lifetime ECL (credit-impaired)	(4)	(108)	112	–	–
Net impairment losses / (gains) in income statement	(56)	254	226	21	445
Re-measurement	(83)	255	356	26	554
Net changes in exposures	11	(73)	(125)	(15)	(202)
ECL model parameter and / or methodology changes	16	72	(5)	10	93
Impairment loss allowances utilised	–	–	(526)	(48)	(574)
Exchange adjustments	1	1	3	1	6
Measurement reclassification and other movements	–	1	47	2	50
Impairment loss allowance at 31 December 2023	180	421	612	9	1,222
Impairment coverage at 31 December 2023 (%)	0.27%	3.36%	26.05%	6.29%	1.51%

Impairment loss allowances utilised on loans and advances to customers at amortised cost during 2023 included €203 million of contractual amounts outstanding that are still subject to enforcement activity.

Loans and advances to customers at amortised cost by portfolio

The following tables set out the movement in both the gross carrying amount and impairment loss allowances subject to 12 month and lifetime ECL on loans and advances to customers at amortised cost by portfolio asset class. These tables are prepared on the same basis as the total Group tables as set out above.

Residential Mortgages

30 June 2024 Residential mortgages - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2024	42,786	3,574	770	142	47,272
Total net transfers	355	(445)	90	–	–
To 12 month ECL (not credit-impaired)	1,716	(1,716)	–	–	–
To lifetime ECL (not credit-impaired)	(1,336)	1,439	(103)	–	–
To lifetime ECL (credit-impaired)	(25)	(168)	193	–	–
Net changes in exposure	1,441	(220)	(70)	(4)	1,147
Impairment loss allowances utilised	–	–	(1)	–	(1)
Exchange adjustments	359	33	10	–	402
Measurement reclassification and other movements	26	–	1	–	27
Gross carrying amount at 30 June 2024	44,967	2,942	800	138	48,847

30 June 2024 Residential mortgages - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2024	40	56	141	9	246
Total net transfers	27	(27)	–	–	–
To 12 month ECL (not credit-impaired)	33	(33)	–	–	–
To lifetime ECL (not credit-impaired)	(6)	17	(11)	–	–
To lifetime ECL (credit-impaired)	–	(11)	11	–	–
Net impairment losses / (gains) in income statement	(32)	11	(6)	(12)	(39)
Re-measurement	(28)	28	12	(9)	3
Net changes in exposures	–	(3)	(8)	–	(11)
ECL model parameter and / or methodology changes	(4)	(14)	(10)	(3)	(31)
Impairment loss allowances utilised	–	–	(1)	–	(1)
Exchange adjustments	–	1	1	–	2
Measurement reclassification and other movements	–	–	6	1	7
Impairment loss allowance at 30 June 2024	35	41	141	(2)	215
Impairment coverage at 30 June 2024 (%)	0.08%	1.39%	17.63%	(1.45%)	0.44%

Impairment loss allowances utilised on Residential mortgages at amortised cost during H124 included €nil of contractual amounts outstanding that are still subject to enforcement activity.

Residential Mortgages (continued)

31 December 2023 Residential mortgages - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2023	34,020	3,546	450	4	38,020
Total net transfers	(1,130)	633	497	–	–
To 12 month ECL (not credit-impaired)	3,986	(3,986)	–	–	–
To lifetime ECL (not credit-impaired)	(4,950)	5,076	(126)	–	–
To lifetime ECL (credit-impaired)	(166)	(457)	623	–	–
Net changes in exposure	9,394	(627)	(165)	140	8,742
Impairment loss allowances utilised	–	–	(16)	(2)	(18)
Exchange adjustments	288	22	4	–	314
Measurement reclassification and other movements	214	–	–	–	214
Gross carrying amount at 31 December 2023	42,786	3,574	770	142	47,272

31 December 2023 Residential mortgages - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2023	18	38	89	1	146
Total net transfers	42	(58)	16	–	–
To 12 month ECL (not credit-impaired)	55	(55)	–	–	–
To lifetime ECL (not credit-impaired)	(12)	23	(11)	–	–
To lifetime ECL (credit-impaired)	(1)	(26)	27	–	–
Net impairment losses / (gains) in income statement	(20)	74	47	9	110
Re-measurement	(34)	75	46	(1)	86
Net changes in exposures	4	(9)	(12)	–	(17)
ECL model parameter and / or methodology changes	10	8	13	10	41
Impairment loss allowances utilised	–	–	(16)	(2)	(18)
Exchange adjustments	–	–	–	–	–
Measurement reclassification and other movements	–	2	5	1	8
Impairment loss allowance at 31 December 2023	40	56	141	9	246
Impairment coverage at 31 December 2023 (%)	0.09%	1.57%	18.31%	6.34%	0.52%

Impairment loss allowances utilised on Residential mortgages at amortised cost during 2023 included €2 million of contractual amounts outstanding that are still subject to enforcement activity.

Non-property SME and corporate

30 June 2024 Non-property SME and corporate - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2024	14,737	4,632	1,080	1	20,450
Total net transfers	(196)	265	(69)	–	–
To 12 month ECL (not credit-impaired)	1,535	(1,534)	(1)	–	–
To lifetime ECL (not credit-impaired)	(1,705)	1,958	(253)	–	–
To lifetime ECL (credit-impaired)	(26)	(159)	185	–	–
Net changes in exposure	711	(612)	(59)	–	40
Impairment loss allowances utilised	–	–	(41)	–	(41)
Exchange adjustments	149	60	11	–	220
Measurement reclassification and other movements	41	–	–	–	41
Gross carrying amount at 30 June 2024	15,442	4,345	922	1	20,710

30 June 2024 Non-property SME and corporate - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2024	65	154	330	–	549
Total net transfers	21	(8)	(13)	–	–
To 12 month ECL (not credit-impaired)	29	(29)	–	–	–
To lifetime ECL (not credit-impaired)	(8)	41	(33)	–	–
To lifetime ECL (credit-impaired)	–	(20)	20	–	–
Net impairment losses / (gains) in income statement	(9)	7	61	–	59
Re-measurement	(22)	32	88	–	98
Net changes in exposures	7	(21)	(28)	–	(42)
ECL model parameter and / or methodology changes	6	(4)	1	–	3
Impairment loss allowances utilised	–	–	(41)	–	(41)
Exchange adjustments	–	–	1	–	1
Measurement reclassification and other movements	–	1	16	–	17
Impairment loss allowance at 30 June 2024	77	154	354	–	585
Impairment coverage at 30 June 2024 (%)	0.50%	3.54%	38.39%	–	2.82%

Impairment loss allowances utilised on Non-property SME and corporate during H124 included €14 million of contractual amounts outstanding that are still subject to enforcement activity.

Non-property SME and corporate (continued)

31 December 2023 Non-property SME and corporate - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2023	15,253	4,665	1,534	16	21,468
Total net transfers	(1,356)	1,108	248	–	–
To 12 month ECL (not credit-impaired)	2,522	(2,518)	(4)	–	–
To lifetime ECL (not credit-impaired)	(3,840)	4,117	(277)	–	–
To lifetime ECL (credit-impaired)	(38)	(491)	529	–	–
Net changes in exposure	822	(1,130)	(397)	(15)	(720)
Impairment loss allowances utilised	–	–	(307)	–	(307)
Exchange adjustments	(12)	(21)	1	–	(32)
Measurement reclassification and other movements	30	10	1	–	41
Gross carrying amount at 31 December 2023	14,737	4,632	1,080	1	20,450

31 December 2023 Non-property SME and corporate - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2023	65	153	563	2	783
Total net transfers	42	(30)	(12)	–	–
To 12 month ECL (not credit-impaired)	64	(63)	(1)	–	–
To lifetime ECL (not credit-impaired)	(20)	76	(56)	–	–
To lifetime ECL (credit-impaired)	(2)	(43)	45	–	–
Net impairment losses / (gains) in income statement	(42)	31	56	(2)	43
Re-measurement	(39)	53	157	–	171
Net changes in exposures	2	(34)	(88)	(2)	(122)
ECL model parameter and / or methodology changes	(5)	12	(13)	–	(6)
Impairment loss allowances utilised	–	–	(307)	–	(307)
Exchange adjustments	–	–	1	–	1
Measurement reclassification and other movements	–	–	29	–	29
Impairment loss allowance at 31 December 2023	65	154	330	–	549
Impairment coverage at 31 December 2023 (%)	0.44%	3.32%	30.56%	–	2.68%

Impairment loss allowances utilised on Non-property SME and corporate during 2023 included €164 million of contractual amounts outstanding that are still subject to enforcement activity.

Property and construction

30 June 2024 Property and construction - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2024	3,336	3,518	369	–	7,223
Total net transfers	36	(192)	156	–	–
To 12 month ECL (not credit-impaired)	661	(661)	–	–	–
To lifetime ECL (not credit-impaired)	(624)	637	(13)	–	–
To lifetime ECL (credit-impaired)	(1)	(168)	169	–	–
Net changes in exposure	433	(449)	(89)	–	(105)
Impairment loss allowances utilised	–	–	(10)	–	(10)
Exchange adjustments	20	34	9	–	63
Measurement reclassification and other movements	(2)	2	–	–	–
Gross carrying amount at 30 June 2024	3,823	2,913	435	–	7,171

30 June 2024 Property and construction - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2024	25	144	80	–	249
Total net transfers	14	(32)	18	–	–
To 12 month ECL (not credit-impaired)	19	(19)	–	–	–
To lifetime ECL (not credit-impaired)	(5)	8	(3)	–	–
To lifetime ECL (credit-impaired)	–	(21)	21	–	–
Net impairment losses / (gains) in income statement	(19)	(4)	37	–	14
Re-measurement	(16)	30	41	–	55
Net changes in exposures	2	(11)	–	–	(9)
ECL model parameter and / or methodology changes	(5)	(23)	(4)	–	(32)
Impairment loss allowances utilised	–	–	(10)	–	(10)
Exchange adjustments	–	–	–	–	–
Measurement reclassification and other movements	–	–	7	–	7
Impairment loss allowance at 30 June 2024	20	108	132	–	260
Impairment coverage at 30 June 2024 (%)	0.52%	3.71%	30.34%	–	3.63%

Impairment loss allowances utilised on Property and construction during H124 included €nil of contractual amounts outstanding that are still subject to enforcement activity.

Property and construction (continued)

31 December 2023 Property and construction - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2023	3,864	3,922	355	60	8,201
Total net transfers	(897)	608	289	–	–
To 12 month ECL (not credit-impaired)	1,743	(1,743)	–	–	–
To lifetime ECL (not credit-impaired)	(2,636)	2,683	(47)	–	–
To lifetime ECL (credit-impaired)	(4)	(332)	336	–	–
Net changes in exposure	358	(1,018)	(194)	(15)	(869)
Impairment loss allowances utilised	–	–	(79)	(46)	(125)
Exchange adjustments	10	4	(2)	1	13
Measurement reclassification and other movements	1	2	–	–	3
Gross carrying amount at 31 December 2023	3,336	3,518	369	–	7,223

31 December 2023 Property and construction - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2023	10	53	102	30	195
Total net transfers	4	(13)	9	–	–
To 12 month ECL (not credit-impaired)	13	(13)	–	–	–
To lifetime ECL (not credit-impaired)	(9)	22	(13)	–	–
To lifetime ECL (credit-impaired)	–	(22)	22	–	–
Net impairment losses / (gains) in income statement	9	105	44	14	172
Re-measurement	2	74	72	27	175
Net changes in exposures	1	(9)	(19)	(13)	(40)
ECL model parameter and / or methodology changes	6	40	(9)	–	37
Impairment loss allowances utilised	–	–	(79)	(46)	(125)
Exchange adjustments	–	–	1	1	2
Measurement reclassification and other movements	2	(1)	3	1	5
Impairment loss allowance at 31 December 2023	25	144	80	–	249
Impairment coverage at 31 December 2023 (%)	0.75%	4.09%	21.68%	–	3.45%

Impairment loss allowances utilised on Property and construction during 2023 included €10 million of contractual amounts outstanding that are still subject to enforcement activity.

Consumer

30 June 2024 Consumer - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2024	4,870	801	130	–	5,801
Total net transfers	(97)	22	75	–	–
To 12 month ECL (not credit-impaired)	223	(222)	(1)	–	–
To lifetime ECL (not credit-impaired)	(291)	295	(4)	–	–
To lifetime ECL (credit-impaired)	(29)	(51)	80	–	–
Net changes in exposure Impairment loss allowances utilised	72 –	(124) –	(29) (27)	– –	(81) (27)
Exchange adjustments	73	17	1	–	91
Measurement reclassification and other movements	–	–	–	–	–
Gross carrying amount at 30 June 2024	4,918	716	150	–	5,784

30 June 2024 Consumer - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2024	50	67	61	–	178
Total net transfers	17	(30)	13	–	–
To 12 month ECL (not credit-impaired)	20	(19)	(1)	–	–
To lifetime ECL (not credit-impaired)	(2)	4	(2)	–	–
To lifetime ECL (credit-impaired)	(1)	(15)	16	–	–
Net impairment losses / (gains) in income statement	(13)	13	39	–	39
Re-measurement	(9)	19	51	–	61
Net changes in exposures	(11)	(11)	(12)	–	(34)
ECL model parameter and / or methodology changes	7	5	–	–	12
Impairment loss allowances utilised	–	–	(27)	–	(27)
Exchange adjustments	3	2	(2)	–	3
Measurement reclassification and other movements	–	–	4	–	4
Impairment loss allowance at 30 June 2024	57	52	88	–	197
Impairment coverage at 30 June 2024 (%)	1.16%	7.26%	58.67%	–	3.41%

Impairment loss allowances utilised on Consumer during H124 included €23 million of contractual amounts outstanding that are still subject to enforcement activity.

Consumer (continued)

31 December 2023 Consumer - Gross carrying amount (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total gross carrying amount €m
Opening balance 1 January 2023	4,694	510	146	–	5,350
Total net transfers	(502)	383	119	–	–
To 12 month ECL (not credit-impaired)	230	(228)	(2)	–	–
To lifetime ECL (not credit-impaired)	(670)	676	(6)	–	–
To lifetime ECL (credit-impaired)	(62)	(65)	127	–	–
Net changes in exposure	616	(97)	(12)	–	507
Impairment loss allowances utilised	–	–	(124)	–	(124)
Exchange adjustments	57	7	2	–	66
Measurement reclassification and other movements	5	(2)	(1)	–	2
Gross carrying amount at 31 December 2023	4,870	801	130	–	5,801

31 December 2023 Consumer - Impairment loss allowance	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total impairment loss allowance €m
Opening balance 1 January 2023	49	41	81	–	171
Total net transfers	5	(19)	14	–	–
To 12 month ECL (not credit-impaired)	15	(14)	(1)	–	–
To lifetime ECL (not credit-impaired)	(9)	12	(3)	–	–
To lifetime ECL (credit-impaired)	(1)	(17)	18	–	–
Net impairment losses / (gains) in income statement	(3)	44	79	–	120
Re-measurement	(12)	53	81	–	122
Net changes in exposures	4	(21)	(6)	–	(23)
ECL model parameter and / or methodology changes	5	12	4	–	21
Impairment loss allowances utilised	–	–	(124)	–	(124)
Exchange adjustments	1	1	1	–	3
Measurement reclassification and other movements	(2)	–	10	–	8
Impairment loss allowance at 31 December 2023	50	67	61	–	178
Impairment coverage at 31 December 2023 (%)	1.03%	8.36%	46.92%	–	3.07%

Impairment loss allowances utilised on Consumer during 2023 included €27 million of contractual amounts outstanding that are still subject to enforcement activity.

19 Credit risk exposures

The following disclosures provide quantitative information about credit risk within financial instruments held by the Group. Details of the Group's credit risk methodologies are set out on pages 159 to 164 of the Group's 2023 Annual Report, with updates for 2024 outlined in the Asset quality section of the OFR. In addition to credit risk, the primary risks affecting the Group through its use of financial instruments are: funding and liquidity risk, market risk and life insurance risk.

The Group's approach to the management of these risks, together with its approach to Capital adequacy, are set out in the Risk Management Report of the Group's 2023 Annual Report.

The table below illustrates the relationship between the Group's internal credit risk rating grades as used for credit risk management purposes and PD percentages, and further illustrates the indicative relationship with credit risk ratings used by external rating agencies.

Internal credit risk ratings
PD Grade	PD %	Indicative S&P type external ratings
1-4	0% ≤ PD < 0.26%	AAA, AA+, AA, AA-, A+, A, A-, BBB+, BBB
5-7	0.26% ≤ PD < 1.45%	BBB-, BB+, BB, BB
8-9	1.45% ≤ PD < 3.60%	B+
10-11	3.60% ≤ PD < 100%	B, Below B
12 (credit-impaired)	100%	n/a

Financial assets

Composition and risk profile

The table below and on the following page summarise the composition and risk profile of the Group's financial assets subject to impairment and the impairment loss allowances on these financial assets. Loans and advances to customers at amortised cost include loans and advances to customers held for sale of €20 million at 30 June 2024 (see note 17 for further details). The tables exclude loan commitments, guarantees and letters of credit of €18,209 million at 30 June 2024 (31 December 2023: €18,823 million) that are subject to impairment. Loans and advances to customers exclude €196 million (31 December 2023: €205 million) of loans mandatorily measured at FVTPL at 30 June 2024 which are not subject to impairment under IFRS 9 and are therefore excluded from impairment related tables.

At 30 June 2024, POCI assets of €139 million (31 December 2023: €143 million) included €83 million (31 December 2023: €118 million) of credit-impaired POCI assets and €56 million of assets (2023: €25 million) which, while credit-impaired upon purchase or origination were no longer credit-impaired at the reporting date due to improvements in credit risk. These assets will remain classified as POCI until derecognition.

At 30 June 2024, other financial assets (before impairment loss allowance) include cash and balances at central banks of €32,149 million (31 December 2023: €31,848 million) and items in the course of collection from other banks of €143 million (31 December 2023: €126 million).

30 June 2024 Financial assets exposure by stage (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total €m
Financial assets measured at amortised cost
Loans and advances to customers	69,150	10,916	2,307	139	82,512
Loans and advances to banks	2,250	–	–	–	2,250
Debt securities	5,990	–	–	–	5,990
Other financial assets	32,292	–	–	–	32,292
Total financial assets measured at amortised cost	109,682	10,916	2,307	139	123,044
Debt instruments at FVOCI	3,702	–	–	–	3,702
Total	113,384	10,916	2,307	139	126,746

30 June 2024 Impairment loss allowance on financial assets	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total €m
Financial assets measured at amortised cost
Loans and advances to customers	189	355	715	(2)	1,257
Loans and advances to banks	1	–	–	–	1
Debt securities	1	–	–	–	1
Other financial assets	5	–	–	–	5
Total financial assets measured at amortised cost	196	355	715	(2)	1,264
Debt instruments at FVOCI	1	–	–	–	1
Total	197	355	715	(2)	1,265

31 December 2023 Financial assets exposure by stage (before impairment loss allowance)	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total €m
Financial assets measured at amortised cost
Loans and advances to customers	65,729	12,525	2,349	143	80,746
Loans and advances to banks	1,808	–	–	–	1,808
Debt securities	5,715	1	–	–	5,716
Other financial assets	31,974	–	–	–	31,974
Total financial assets measured at amortised cost	105,226	12,526	2,349	143	120,244
Debt instruments at FVOCI	3,968	–	–	–	3,968
Total	109,194	12,526	2,349	143	124,212

31 December 2023 Impairment loss allowance on financial assets	Stage 1 - 12 month ECL (not credit impaired) €m	Stage 2 - Lifetime ECL (not credit impaired) €m	Stage 3 - Lifetime ECL (credit impaired) €m	Purchased / originated credit impaired €m	Total €m
Financial assets measured at amortised cost
Loans and advances to customers	180	421	612	9	1,222
Loans and advances to banks	1	–	–	–	1
Debt securities	1	–	–	–	1
Other financial assets	5	–	–	–	5
Total financial assets measured at amortised cost	187	421	612	9	1,229
Debt instruments at FVOCI	1	–	–	–	1
Total	188	421	612	9	1,230

Loans and advances to customers at amortised cost

Composition and risk profile

The table below summarises the composition and risk profile of the Group's loans and advances to customers at amortised cost, including POCI assets. Credit-impaired includes Stage 3 and POCI assets of €83 million (31 December 2023: €118 million). Total POCI assets at 30 June 2024 were €139 million (31 December 2023: €143 million). €56 million of POCI assets (31 December 2023: €25 million) were no longer credit-impaired at the reporting date due to improvement in credit risk since purchase or origination. These loans will remain classified as POCI loans until derecognition.

		30 June 2024				31 December 2023
Loans and advances to customers Composition and risk profile (before	Not credit impaired	Credit impaired	Total		Not credit impaired	Credit impaired	Total
impairment loss allowance)	€m	€m	€m	%	€m	€m	€m	%
Residential mortgages	47,909	800	48,709	59%	46,360	770	47,130	58%
Retail Ireland	32,458	423	32,881	40%	31,719	383	32,102	40%
Retail UK	15,451	377	15,828	19%	14,641	387	15,028	18%
Non-property SME and corporate	19,787	922	20,709	25%	19,369	1,080	20,449	26%
Republic of Ireland SME	6,895	360	7,255	9%	6,811	342	7,153	9%
UK SME	1,441	87	1,528	2%	1,467	80	1,547	2%
Corporate	11,451	475	11,926	14%	11,091	658	11,749	15%
Property and construction	6,736	435	7,171	9%	6,854	369	7,223	9%
Investment	6,152	385	6,537	8%	6,363	320	6,683	9%
Development	584	50	634	1%	491	49	540	–
Consumer	5,634	150	5,784	7%	5,671	130	5,801	7%
Total	80,066	2,307	82,373	100%	78,254	2,349	80,603	100%
Purchased / originated credit-impaired	56	83	139	–	25	118	143	–
Total	80,122	2,390	82,512	100%	78,279	2,467	80,746	100%
Impairment loss allowance on loans and advances to customers	534	723	1,257	2%	598	624	1,222	2%

Asset quality - not credit-impaired

The tables below summarise the composition and impairment loss allowance of the Group's loans and advances to customers at amortised cost that are not credit-impaired. Excluded from the tables are POCI assets of €56 million (31 December 2023: €25 million) which were no longer credit-impaired at the reporting date due to improvement in credit risk since purchase or origination. These assets will remain classified as POCI until derecognition.

		Stage 1			Stage 2
30 June 2024 Not credit-impaired loans and advances to customers Composition and impairment loss allowance	Stage 1 loans €m	Loans as % of advances1 %	Stage 1 ILA €m	ILA as % of Stage 1 loans %	Stage 2 loans €m	Loans as % of advances1 %	Stage 2 ILA €m	ILA as % of Stage 2 loans %
Residential mortgages	44,967	92.3%	35	0.08%	2,942	6.0%	41	1.39%
Retail Ireland	30,297	92.1%	24	0.08%	2,161	6.6%	26	1.20%
Retail UK	14,670	92.7%	11	0.07%	781	4.9%	15	1.92%
Non-property SME and corporate	15,442	74.6%	77	0.50%	4,345	21.0%	154	3.54%
Republic of Ireland SME	5,642	77.8%	49	0.87%	1,253	17.3%	57	4.55%
UK SME	1,218	79.7%	5	0.41%	223	14.6%	12	5.38%
Corporate	8,582	72.0%	23	0.27%	2,869	24.1%	85	2.96%
Property and construction	3,823	53.3%	20	0.52%	2,913	40.6%	108	3.71%
Investment	3,367	51.5%	18	0.53%	2,785	42.6%	105	3.77%
Development	456	71.9%	2	0.44%	128	20.2%	3	2.34%
Consumer	4,918	85.0%	57	1.16%	716	12.4%	52	7.26%
Total	69,150	83.9%	189	0.27%	10,916	13.3%	355	3.25%

		Stage 1				Stage 2
31 December 2023 Not credit-impaired loans and advances to customers Composition and impairment loss allowance	Stage 1 loans €m	Loans as % of advances1 %	Stage 1 ILA €m	ILA as % of Stage 1 loans %	Stage 2 loans €m	Loans as % of advances1 %	Stage 2 ILA €m	ILA as % of Stage 2 loans %
Residential mortgages	42,786	90.8%	40	0.09%	3,574	7.6%	56	1.57%
Retail Ireland	29,365	91.5%	28	0.10%	2,354	7.3%	32	1.36%
Retail UK	13,421	89.3%	12	0.09%	1,220	8.1%	24	1.97%
Non-property SME and corporate	14,737	72.0%	65	0.44%	4,632	22.7%	154	3.32%
Republic of Ireland SME	5,667	79.2%	36	0.64%	1,144	16.0%	45	3.93%
UK SME	1,154	74.6%	5	0.43%	313	20.2%	22	7.03%
Corporate	7,916	67.4%	24	0.30%	3,175	27.0%	87	2.74%
Property and construction	3,336	46.2%	25	0.75%	3,518	48.7%	144	4.09%
Investment	2,934	43.9%	22	0.75%	3,429	51.3%	141	4.11%
Development	402	74.4%	3	0.75%	89	16.5%	3	3.37%
Consumer	4,870	84.0%	50	1.03%	801	13.8%	67	8.36%
Total	65,729	81.4%	180	0.27%	12,525	15.5%	421	3.36%

¹'Advances' refers to the portfolio loan balance (pre-impairment loss allowance) excluding POCI assets.

Asset quality - credit-impaired

Credit-impaired loans include loans where the borrower is considered unlikely to pay in full without recourse by the Group to actions such as realising security, and loans where the borrower is greater than or equal to 90 days past due and the arrears amount is material. All credit-impaired loans and advances to customers are risk rated PD grade 12.

The table below summarises the composition and impairment loss allowance of the Group's loans and advances to customers at amortised cost that are credit-impaired. Credit-impaired includes Stage 3 and POCI assets of €83 million (31 December 2023: €118 million). €56 million of POCI assets (31 December 2023: €25 million) were no longer credit-impaired at the reporting date due to improvement in credit risk since purchase or origination. These loans will remain classified as POCI loans until derecognition.

			30 June 2024		31 December 2023
Credit-impaired (CI) loans and advances to customers Composition and impairment loss allowance	Credit impaired (CI) loans €m	CI Loans as % of advances1 %	CI Impairment loss allowance €m	CI ILA as % of CI loans %	Credit impaired (CI) loans €m	CI Loans as % of advances1 %	CI Impairment loss allowance €m	CI ILA as % of CI loans %
Residential mortgages	800	1.6%	141	18%	770	1.6%	141	18%
Retail Ireland	423	1.3%	93	22%	383	1.2%	89	23%
Retail UK	377	2.4%	48	13%	387	2.6%	52	13%
Non-property SME and corporate	922	4.5%	354	38%	1,080	5.3%	330	31%
Republic of Ireland SME	360	5.0%	170	47%	342	4.8%	161	47%
UK SME	87	5.7%	17	20%	80	5.2%	22	28%
Corporate	475	4.0%	167	35%	658	5.6%	147	22%
Property and construction	435	6.1%	132	30%	369	5.1%	80	22%
Investment	385	5.9%	118	31%	320	4.8%	69	22%
Development	50	7.9%	14	28%	49	9.1%	11	22%
Consumer	150	2.6%	88	59%	130	2.2%	61	47%
Total credit-impaired	2,307	2.8%	715	31%	2,349	2.9%	612	26%
Purchased / originated credit impaired	83	59.7%	8	10%	118	82.5%	12	10%
Total	2,390	2.9%	723	30%	2,467	3.1%	624	25%

¹'Advances' refers to the portfolio loan balance (pre-impairment loss allowance) excluding POCI assets

Asset quality - PD Grade of loans and advances to customers

The tables below provide analysis of the asset quality of loans and advances to customers at amortised cost based on mapping the IFRS 9 twelve month PD of each loan to a PD grade based on the table provided on page 87. Credit-impaired includes Stage 3 and POCI assets of €83 million (31 December 2023: €118 million). Not credit-impaired includes Stage 1 & 2 and POCI assets of €56 million (31 December 2023: €25 million) which were no longer credit-impaired at the reporting date due to improvement in credit risk since purchase or origination. These assets will remain classified as POCI loans until derecognition.

30 June 2024 Loans and advances to customers Asset quality	Residential mortgages		Non-property SME and corporate		Property and construction		Consumer		Total
- PD grade	€m	%	€m	%	€m	%	€m	%	€m	%
Stage 1
1-4	7,849	16%	3,184	15%	239	3%	5	–	11,277	14%
5-7	33,226	68%	6,578	33%	1,837	26%	2,449	42%	44,090	53%
8-9	2,165	4%	4,582	22%	1,678	23%	1,339	23%	9,764	12%
10-11	1,727	4%	1,098	5%	69	1%	1,125	20%	4,019	5%
Total Stage 1	44,967	92%	15,442	75%	3,823	53%	4,918	85%	69,150	84%
Stage 2
1-4	478	1%	200	1%	–	–	–	–	678	1%
5-7	1,409	2%	1,115	5%	491	7%	288	5%	3,303	4%
8-9	254	1%	1,233	6%	1,669	23%	109	2%	3,265	4%
10-11	801	2%	1,797	9%	753	11%	319	5%	3,670	4%
Total Stage 2	2,942	6%	4,345	21%	2,913	41%	716	12%	10,916	13%

Not credit-impaired
1-4	8,327	17%	3,384	16%	239	3%	5	–	11,955	15%
5-7	34,635	70%	7,693	38%	2,328	33%	2,737	47%	47,393	57%
8-9	2,419	5%	5,815	28%	3,347	46%	1,448	25%	13,029	16%
10-11	2,528	6%	2,895	14%	822	12%	1,444	25%	7,689	9%
Purchased / originated not credit-impaired	56	–	–	–	–	–	–	–	56	–
Total not credit-impaired	47,965	98%	19,787	96%	6,736	94%	5,634	97%	80,122	97%
Credit-impaired
12	800	2%	922	4%	435	6%	150	3%	2,307	3%
Purchased / originated credit-impaired	82	–	1	–	–	–	–	–	83	–
Total credit-impaired	882	2%	923	4%	435	6%	150	3%	2,390	3%
Total	48,847	100%	20,710	100%	7,171	100%	5,784	100%	82,512	100%

31 December 2023 Loans and advances to customers Asset quality	Residential mortgages		Non-property SME and corporate		Property and construction		Consumer		Total
- PD grade	€m	%	€m	%	€m	%	€m	%	€m	%
Stage 1
1-4	9,522	20%	2,691	13%	147	2%	21	–	12,381	15%
5-7	28,645	61%	5,383	26%	1,571	22%	2,496	43%	38,095	47%
8-9	3,403	7%	5,822	29%	1,396	19%	1,263	22%	11,884	15%
10-11	1,216	3%	841	4%	222	3%	1,090	19%	3,369	4%
Total Stage 1	42,786	91%	14,737	72%	3,336	46%	4,870	84%	65,729	81%
Stage 2
1-4	540	1%	272	1%	–	–	–	–	812	1%
5-7	1,703	4%	1,549	8%	556	8%	339	6%	4,147	5%
8-9	472	1%	1,031	5%	1,265	18%	64	1%	2,832	4%
10-11	859	2%	1,780	9%	1,697	23%	398	7%	4,734	6%
Total Stage 2	3,574	8%	4,632	23%	3,518	49%	801	14%	12,525	16%
Not credit-impaired
1-4	10,062	21%	2,963	14%	147	2%	21	–	13,193	16%
5-7	30,348	65%	6,932	34%	2,127	30%	2,835	49%	42,242	52%
8-9	3,875	8%	6,853	34%	2,661	37%	1,327	23%	14,716	19%
10-11	2,075	5%	2,621	13%	1,919	26%	1,488	26%	8,103	10%
Purchased / originated not credit-impaired	25	–	–	–	–	–	–	–	25	–
Total not credit-impaired	46,385	99%	19,369	95%	6,854	95%	5,671	98%	78,279	97%
Credit-impaired
12	770	1%	1,080	5%	369	5%	130	2%	2,349	3%
Purchased / originated credit-impaired	117	–	1	–	–	–	–	–	118	–
Total credit-impaired	887	1%	1,081	5%	369	5%	130	2%	2,467	3%
Total	47,272	100%	20,450	100%	7,223	100%	5,801	100%	80,746	100%

Geographical and industry analysis of loans and advances to customers

The following tables provide a geographical and industry breakdown of loans and advances to customers at amortised cost, and the associated impairment loss allowances. The geographical breakdown is primarily based on the location of the business unit where the asset is booked. The Non-property SME & corporate portfolio is analysed by NACE code. The NACE code classification system is a pan-European classification system that groups organisations according to their business activities. Exposures to NACE codes totalling less than €400 million are grouped together as 'Other sectors'. The NACE codes reported in the table below can therefore differ period on period.

		Gross carrying amount		Impairment loss allowance
30 June 2024 Geographical / industry analysis	RoI €m	(before impairment loss allowance) UK €m	RoW €m	Total €m	RoI €m	UK €m	RoW €m	Total €m
Personal	35,462	19,169	–	54,631	240	172	–	412
Residential mortgages	33,019	15,828	–	48,847	141	74	–	215
Other consumer lending	2,443	3,341	–	5,784	99	98	–	197
Property and construction	6,830	341	–	7,171	251	9	–	260
Investment	6,223	314	–	6,537	233	8	–	241
Development	607	27	–	634	18	1	–	19
Non-property SME & corporate	17,977	1,688	1,045	20,710	493	38	54	585
Manufacturing	3,742	242	483	4,467	111	6	9	126
Administrative and support service activities	2,499	249	190	2,938	71	7	4	82
Wholesale and retail trade	1,981	175	52	2,208	50	2	–	52
Agriculture, forestry and fishing	1,572	213	–	1,785	53	3	–	56
Accommodation and food service activities	1,467	71	39	1,577	27	2	4	33
Human health services and social work activities	1,321	119	67	1,507	30	5	1	36
Transport and storage	719	88	77	884	25	1	16	42
Other services	696	32	84	812	16	1	18	35
Professional, scientific and technical activities	633	29	27	689	17	–	2	19
Real estate activities	548	120	–	668	34	4	–	38
Financial and insurance activities	594	71	–	665	3	1	–	4
Electricity, gas, steam and air conditioning supply	540	14	–	554	4	–	–	4
Construction	271	192	–	463	10	2	–	12
Education	430	7	25	462	9	–	–	9
Other sectors	964	66	1	1,031	33	4	–	37
Total	60,269	21,198	1,045	82,512	984	219	54	1,257
Analysed by stage
Stage 1	49,616	18,939	595	69,150	136	50	3	189
Stage 2	8,860	1,714	342	10,916	273	68	14	355
Stage 3	1,654	545	108	2,307	577	101	37	715
Purchased / originated credit-impaired	139	–	–	139	(2)	–	–	(2)
Total	60,269	21,198	1,045	82,512	984	219	54	1,257

		Gross carrying amount (before impairment loss allowance)	Impairment loss allowance
31 December 2023 Geographical / industry analysis	RoI €m	UK €m	RoW €m	Total €m	RoI €m	UK €m	RoW €m	Total €m
Personal	34,633	18,440	–	53,073	242	182	–	424
Residential mortgages	32,244	15,028	–	47,272	158	88	–	246
Other consumer lending	2,389	3,412	–	5,801	84	94	–	178
Property and construction	6,889	334	–	7,223	236	13	–	249
Investment	6,375	308	–	6,683	221	11	–	232
Development	514	26	–	540	15	2	–	17
Non-property SME & corporate	17,721	1,709	1,020	20,450	458	54	37	549
Manufacturing	3,690	244	475	4,409	107	4	9	120
Administrative and support service activities	2,754	242	184	3,180	61	12	2	75
Wholesale and retail trade	2,060	155	43	2,258	42	2	–	44
Agriculture, forestry and fishing	1,526	213	–	1,739	47	4	–	51
Accommodation and food service activities	1,378	68	38	1,484	27	3	4	34
Human health services and social work activities	1,310	173	68	1,551	42	14	1	57
Transport and storage	664	87	77	828	25	2	12	39
Other services	713	34	85	832	13	1	6	20
Professional, scientific and technical activities	740	33	26	799	16	–	2	18
Real estate activities	537	117	–	654	34	4	–	38
Financial and insurance activities	512	69	–	581	4	1	–	5
Electricity, gas, steam and air conditioning supply	429	14	–	443	3	–	–	3
Education	416	9	24	449	6	–	–	6
Other sectors	992	251	–	1,243	31	7	1	39
Total	59,243	20,483	1,020	80,746	936	249	37	1,222
Analysed by stage
Stage 1	47,614	17,520	595	65,729	126	51	3	180
Stage 2	9,744	2,437	344	12,525	297	108	16	421
Stage 3	1,742	526	81	2,349	504	90	18	612
Purchased / originated credit-impaired	143	–	–	143	9	–	–	9
Total	59,243	20,483	1,020	80,746	936	249	37	1,222

Sectoral analysis of loans and advances to customers

The following tables provide an analysis of loans and advances to customers at amortised cost, and the associated impairment loss allowances, by portfolio, sub-sector and stage. The Non-property SME & corporate portfolio is analysed by NACE code. The NACE code classification system is a pan-European classification system that groups organisations according to their business activities. Exposures to NACE codes totalling less than €400 million are grouped together as 'Other sectors'. The NACE codes reported in the tables below can therefore differ period on period.

		Gross carrying amount (before impairment loss allowance)					Impairment loss allowance
30 June 2024	Stage 1	Stage 2	Stage 3	POCI	Total	Stage 1	Stage 2	Stage 3	POCI	Total
Sectoral analysis by stage	€m	€m	€m	€m	€m	€m	€m	€m	€m	€m
Personal
Residential mortgages	44,967	2,942	800	138	48,847	35	41	141	(2)	215
Other consumer	4,918	716	150	–	5,784	57	52	88	–	197
Motor lending UK	1,937	372	49	–	2,358	4	6	16	–	26
Loans RoI	730	215	51	–	996	14	17	40	–	71
Loans UK	856	100	27	–	983	28	25	19	–	72
Motor Lending RoI	856	2	10	–	868	8	–	5	–	13
Credit cards RoI	539	27	13	–	579	3	4	8	–	15
	49,885	3,658	950	138	54,631	92	93	229	(2)	412
Property and construction	3,823	2,913	435	–	7,171	20	108	132	–	260
Investment	3,367	2,785	385	–	6,537	18	105	118	–	241
Development	456	128	50	–	634	2	3	14	–	19
Non-property SME & corporate	15,442	4,345	922	1	20,710	77	154	354	–	585
Manufacturing	3,203	1,043	221	–	4,467	12	36	78	–	126
Administrative and support service activities	2,316	539	83	–	2,938	15	21	46	–	82
Wholesale and retail trade	1,707	438	63	–	2,208	11	17	24	–	52
Agriculture, forestry and fishing	1,440	263	82	–	1,785	10	9	37	–	56
Accommodation and food service activities	954	532	90	1	1,577	4	7	22	–	33
Human health services and social work activities	992	477	38	–	1,507	4	18	14	–	36
Transport and storage	634	166	84	–	884	3	6	33	–	42
Other services	579	166	67	–	812	3	5	27	–	35
Professional, scientific and technical activities	503	152	34	–	689	2	5	12	–	19
Real estate activities	449	159	60	–	668	4	7	27	–	38
Financial and insurance activities	586	76	3	–	665	1	2	1	–	4
Electricity, gas, steam and air conditioning supply	506	46	2	–	554	1	2	1	–	4
Construction	428	16	19	–	463	3	1	8	–	12
Education	381	80	1	–	462	1	8	–	–	9
Other sectors	764	192	75	–	1,031	3	10	24	–	37
Total	69,150	10,916	2,307	139	82,512	189	355	715	(2)	1,257

		Gross carrying amount (before impairment loss allowance) Impairment loss allowance
31 December 2023 Sectoral analysis by stage	Stage 1 €m	Stage 2 €m	Stage 3 €m	POCI €m	Total €m	Stage 1 €m	Stage 2 €m	Stage 3 €m	POCI €m	Total €m
Personal
Residential mortgages	42,786	3,574	770	142	47,272	40	56	141	9	246
Other consumer	4,870	801	130	–	5,801	50	67	61	–	178
Motor lending UK	1,749	410	38	–	2,197	4	7	13	–	24
Loans RoI	800	117	55	–	972	8	13	36	–	57
Loans UK	966	234	15	–	1,215	29	41	1	–	71
Motor lending RoI	798	3	12	–	813	6	–	5	–	11
Credit cards RoI	557	37	10	–	604	3	6	6	–	15
	47,656	4,375	900	142	53,073	90	123	202	9	424
Property and construction	3,336	3,518	369	–	7,223	25	144	80	–	249
Investment	2,934	3,429	320	–	6,683	22	141	69	–	232
Development	402	89	49	–	540	3	3	11	–	17
Non-property SME & corporate	14,737	4,632	1,080	1	20,450	65	154	330	–	549
Manufacturing	2,937	1,224	248	–	4,409	11	36	73	–	120
Administrative and support service activities	2,521	580	79	–	3,180	13	20	42	–	75
Wholesale and retail trade	1,719	482	57	–	2,258	8	10	26	–	44
Agriculture, forestry and fishing	1,332	323	84	–	1,739	8	9	34	–	51
Human health services and social work activities	933	405	213	–	1,551	4	24	29	–	57
Accommodation and food service activities	869	504	110	1	1,484	3	7	24	–	34
Other services	606	167	59	–	832	3	6	11	–	20
Transport and storage	592	169	67	–	828	2	7	30	–	39
Professional, scientific and technical activities	640	131	28	–	799	3	4	11	–	18
Real estate activities	421	171	62	–	654	4	7	27	–	38
Financial and insurance activities	495	83	3	–	581	1	3	1	–	5
Education	366	82	1	–	449	1	5	–	–	6
Electricity, gas, steam and air conditioning supply	390	52	1	–	443	1	2	–	–	3
Other sectors	916	259	68	–	1,243	3	14	22	–	39
Total	65,729	12,525	2,349	143	80,746	180	421	612	9	1,222

Asset quality - other financial assets

The tables below summarise the asset quality of debt instruments at fair value through other comprehensive income (FVOCI), debt securities at amortised cost and loans and advances to banks at amortised cost by IFRS 9 12 month PD grade.

	30 June 2024						31 December 2023
Debt instruments at FVOCI	Stage 1		Stage 2		Total		Stage 1		Stage 2		Total
Asset quality	€m	%	€m	%	€m	%	€m	%	€m	%	€m	%
PD Grade
1-4	3,637	98%	–	–	3,637	98%	3,910	99%	–	–	3,910	99%
5-7	65	2%	–	–	65	2%	58	1%	–	–	58	1%
8-9	–	–	–	–	–	–	–	–	–	–	–	–
10-11	–	–	–	–	–	–	–	–	–	–	–	–
Total	3,702	100%	–	–	3,702	100%	3,968	100%	–	–	3,968	100%

			30 June 2024			31 December 2023
Debt securities at amortised cost (before impairment loss	Stage 1		Stage 2		Total		Stage 1		Stage 2		Total
allowance) Asset quality	€m	%	€m	%	€m	%	€m	%	€m	%	€m	%
PD Grade
1-4	5,990	100%	–	–	5,990	100%	5,715	100%	1	–	5,716	100%
5-7	–	–	–	–	–	–	–	–	–	–	–	–
8-9	–	–	–	–	–	–	–	–	–	–	–	–
10-11	–	–	–	–	–	–	–	–	–	–	–	–
Total	5,990	100%	–	–	5,990	100%	5,715	100%	1	–	5,716	100%

Loans and advances to banks at amortised cost (before			30 June 2024						31 December 2023
impairment loss allowance)	Stage 1		Stage 2		Total		Stage 1		Stage 2		Total
Asset quality	€m	%	€m	%	€m	%	€m	%	€m	%	€m	%
PD Grade
1-4	2,247	100%	–	–	2,247	100%	1,807	100%	–	–	1,807	100%
5-7	3	–	–	–	3	–	1	–	–	–	1	–
8-9	–	–	–	–	–	–	–	–	–	–	–	–
10-11	–	–	–	–	–	–	–	–	–	–	–	–
Total	2,250	100%	–	–	2,250	100%	1,808	100%	–	–	1,808	100%

Asset quality - other financial instruments

Other financial instruments as set out in the table below include instruments that are not within the scope of IFRS 9 or are not subject to impairment under IFRS 9. These include trading securities (excluding equity trading securities), derivative financial instruments, loans and advances to banks at fair value, loans and advances to customers at fair value and other financial instruments at FVTPL (excluding equity instruments). Reinsurance contract assets are excluded from this table as they are included in a separate table below under IFRS 17. The table summarises the asset quality of these financial instruments by equivalent external risk ratings.

	30 June 2024		31 December 2023
Other financial instruments with ratings equivalent to:	€m	%	€m	%
AAA to AA-	4,971	48%	4,786	46%
A+ to A-	4,381	43%	4,897	46%
BBB+ to BBB-	668	7%	656	6%
BB+ to BB-	59	1%	65	1%
B+ to B-	152	1%	154	1%
Lower than B-	36	–	39	–
Total	10,267	100%	10,597	100%

Credit Risk for reinsurance contract assets

The table below provides information relating to the reinsurance contract assets with reinsurance counterparties split by credit ratings:

Reinsurance contract assets with ratings equivalent to:	30 June 2024 €m	31 December 2023 €m
AA- or higher	906	948
A / A+	513	466
Total	1,419	1,414

20 Modified financial assets

The following table provides analysis of financial assets for which the contractual cash flows have been modified while they had an impairment loss allowance measured at an amount equal to lifetime ECL, and where the modification did not result in derecognition.

	30 June 2024 €m	31 December 2023 €m
Financial assets modified during the period
Amortised cost before modification	371	844
Financial assets modified since initial recognition
Gross carrying amount of financial assets for which impairment loss allowance has changed from lifetime to 12 month expected credit losses during the period	1,909	1,425

21 Deferred tax

The DTA of €665 million (31 December 2023: €808 million) includes an amount of €724 million (31 December 2023: €845 million) in respect of operating losses which are available to shelter future profits from tax, of which €669 million relates to Irish tax losses carried forward by The Governor and Company of the Bank of Ireland (the 'Bank'), €51 million relates to UK tax losses carried forward by Bank of Ireland (UK) plc, and €4 million relates to US tax losses carried forward by the US branch of the Bank.

The recognition of a DTA in respect of tax losses carried forward requires the Directors to be satisfied that it is probable that the Group will have sufficient future taxable profits against which the losses can be utilised.

In considering the available evidence to support recognition of the DTA, the Group takes into consideration the impact of both positive and negative evidence including historical financial performance, projections of future taxable income and the impact of tax legislation.

Positive factors which have been considered include:

• as evidenced by continuing profitability, and with the exception of 2020 and the years of the financial crisis, the Group has a sustained history of Irish operating profits and a large market share and it is considered likely that the Group's Irish activities will be profitable into the future;

the absence of any expiry dates for Irish and UK tax losses; and
external economic forecasts for Ireland and the UK which indicate continued economic growth and improved employment levels.

The Group also considered negative evidence and the inherent uncertainties in any long-term financial assumptions and projections, including:

the absolute level of deferred tax assets compared to the Group's equity;
the quantum of profits required to be earned and the period over which it is projected that the tax losses will be utilised;
the level of competition and the evolving interest rate environment; and
accelerated transformation of banking business models.

Based on the Group's proven earnings history, its strong position within the Irish financial services market and its strategic priorities to deliver sustained future Irish profits, the Directors believe that the Group will be profitable over the longer term but acknowledge the external challenges facing the banking industry, in particular, the traditional, full service banks and the inherent uncertainties of long-term financial projections.

21 Deferred tax (continued)

The Group's assessment of deferred tax recoverability is based on its financial projections covering its five year initial planning period, with an annual 2% growth rate thereafter and, based on these projections, the DTA in respect of Irish tax losses is estimated to be recovered in full by the end of 2028 (31 December 2023: 2028). The use of reasonably possible alternative assumptions within those projections would not impact the carrying value of the DTA.

Notwithstanding the absence of any expiry date for trading losses in the UK, the Group continues to conclude that, for the purpose of valuing its UK DTA, the brought forward trading losses within the Bank's UK branch will be limited by reference to a ten year period of projected UK branch profits at the prevailing UK tax rates. This ten year timescale is the period over which the Group believes it can conclude that it is probable that future taxable profits will be available in the UK branch.

On this basis, no DTA is currently recognised for losses of the Bank's UK branch (31 December 2023: €nil). However, any remaining unutilised carried forward trading losses of the UK branch have been recognised for DTA purposes at the Irish tax rate, on the basis that it is expected that these will be utilised against future Bank profits in Ireland as permitted by current tax legislation.

22 Deposits from banks

At 30 June 2024, the Group held Monetary Authority secured funding of €2.1 billion (31 December 2023: €2.5 billion) under the TFSME. Drawings under the TFSME from the Bank of England will be largely repaid in 2024 and 2025 with the final residual amount repaid in October 2026.

At 30 June 2024, the Group's Monetary Authority secured funding is secured by loans and advances to customers.

Deposits from banks included cash collateral of €0.2 billion at 30 June 2024 (31 December 2023: €0.4 billion) received from derivative counterparties in relation to net derivative asset positions.

The DTA of Bank of Ireland (UK) plc is recognised in full with an estimated recovery period of 2030.

There is a risk that the final taxation outcome could be different to the amounts currently recorded. If future profits or subsequent forecasts differ from current forecasts, a further adjustment may be required to the DTA.

Pillar 2 model rules

The Group currently estimates that there could be a future top-up tax payable in Ireland on an element of Irish profits but, the impact on the current tax charge in the current period is insignificant due primarily to the ability to take into account certain historic tax losses in the Bank at 15% and also due to profits arising in jurisdictions with an effective tax rate in excess of 15%.

The Group applies the mandatory exception to recognising and disclosing information about deferred tax assets and liabilities related to Pillar 2 income taxes, as provided in the amendments to IAS 12 issued in May 2023.

	30 June 2024 €m	31 December 2023 €m
Monetary Authority secured funding	2,068	2,475
Deposits from banks	541	620
Securities sold under agreement to repurchase - private market repos	9	–
Deposits from banks	2,618	3,095

23 Customer accounts

The carrying amount of the customer accounts designated at FVTPL at 30 June 2024 was €195 million, €8 million lower than the contractual amount due at maturity of €203 million (31 December 2023: the carrying amount was €230 million, €12 million lower than the contractual amount due at maturity of €242 million).

At 30 June 2024, the Group's largest 20 customer deposits amounted to 3% (31 December 2023: 2%) of customer accounts. Deposit accounts where a period of notice is required to make a withdrawal are classified within term deposits and other products.

In H123, the Group completed the KBCI portfolio acquisition. The Group acquired customer accounts with a nominal value of €1.8 billion and loans and advances to customers of €8.0 billion (Note 18) as at the balance sheet acquisition date of 3 February 2023.

	30 June 2024 €m	31 December 2023 €m
Current accounts	58,492	59,665
Demand deposits	30,256	30,392
Term deposits and other products	11,852	9,896
Customer accounts at amortised cost	100,600	99,953
Term deposits at FVTPL	195	230
Total customer accounts	100,795	100,183

Movement in own credit risk on deposits at FVTPL	30 June 2024 €m	31 December 2023 €m
Balance at 1 January	(2)	(13)
Recognised in other comprehensive income	1	11
Balance at end of the period	(1)	(2)

24 Debt securities in issue

The carrying amount of bonds and medium term notes has increased by €0.9 billion at 30 June 2024 (31 December 2023: €0.6 billion) due mainly to senior bond issuances of €1.0 billion.

The carrying amount of the debt securities in issue designated at FVTPL at 30 June 2024 was €194 million, €26 million lower than the contractual amount due at maturity of €220 million (31 December 2023: the carrying amount was €267 million, €21 million lower than the contractual carrying amount due at maturity of €288 million).

Movement in own credit risk on debt securities in issue at FVTPL Balance at 1 January	30 June 2024 €m 3	31 December 2023 €m –
Recognised in other comprehensive income	1	3
Balance at end of the period	4	3

	30 June 2024 €m	31 December 2023 €m
Bonds and medium term notes	8,316	7,363
Other debt securities in issue	1,096	1,040
Debt securities in issue at amortised cost	9,412	8,403
Debt securities in issue at fair value through profit or loss	194	267
Total debt securities in issue	9,606	8,670
Balance at 1 January	8,670	7,774
Issued during the period	1,037	2,785
Redemptions	(76)	(1,930)
Repurchases	(10)	(10)
Other movements1	(15)	51
Balance at end of the period	9,606	8,670

¹Other movements primarily relate to fair value hedge adjustments in respect of debt securities in issue held at amortised cost, exchange adjustments and changes in fair value of debt securities in issue held at fair value.

25 Contingent liabilities and commitments

	30 June 2024 €m	31 December 2023 €m
Contingent liabilities
Guarantees and irrevocable letters of credit	778	901
Acceptances and endorsements	2	4
Other contingent liabilities	213	179
	993	1,084
Loan commitments
Documentary credits and short-term trade related transactions	14	14
Undrawn formal standby facilities, credit lines and other commitments to lend	17,417	17,908
Revocable or irrevocable with original maturity of 1 year or less	9,481	9,727
Irrevocable with original maturity of over 1 year	7,936	8,181
	17,431	17,922
Capital commitments	202	209

The table gives the contract amounts of contingent liabilities and commitments. The maximum exposure to credit loss under contingent liabilities and commitments is the contractual amount of the instrument in the event of nonperformance by the other party where all counter claims, collateral or security prove worthless.

Other contingent liabilities

Other contingent liabilities primarily include performance bonds and are generally short-term commitments to third parties which are not directly dependent on the customers' credit worthiness. The Group is also party to legal, regulatory, taxation and other actions arising out of its normal business operations.

The Group is currently reviewing its application of certain charges that have been applied in its Retail Ireland business and the appropriateness and completeness of reporting in relation to the Central Credit Register (CCR) requirements in Ireland. It is not currently practicable to estimate the amount or timing of any impact from these reviews.

Additionally, the Group's UK motor finance business, similar to industry peers, continues to receive complaints and court claims in relation to its historical commission arrangements, some of which are with the Financial Ombudsman Service (FOS). There is significant uncertainty around the scope and / or nature of these issues, related complaints and of any remediation, if required, given the challenges to the interpretation and / or validity of complaints and the associated regulatory requirements.

The FOS found in favour of complainants in two decisions in January 2024 relating to other lenders. The Financial Conduct Authority (FCA) noted that this was likely to prompt a significant increase in complaints from consumers to firms and the FOS. Hence, the FCA are currently using their powers under s166 of the Financial Services and Markets Act 2000 to review historical motor finance commission arrangements and sales across several firms. The FCA have stated that if they find there has been widespread misconduct and customer harm, they will identify how best to remediate consumers through an appropriate settlement arrangement in an orderly, consistent and efficient way and, if necessary, resolve any contested legal issues of general importance. The Group's UK motor finance business continues to engage with the FCA as part of their s166 review.

While it is possible that certain charges may be incurred in relation to existing or future complaints and court claims, it is not considered that a legal or constructive obligation has been incurred in relation to these matters that would require a provision to be recognised at this stage. Furthermore, given the inherent uncertainties relating to the scope and timing of any possible outflow, it is not currently practicable to estimate the extent of any potential financial impact.

Loan commitments

In 2022, as part of the KBCI portfolio acquisition the Group committed to support the growth of non-bank lenders in the Irish mortgage market, making €1 billion in total funding available to certain non-bank lenders through the purchase of securities issued by them, to increase their funding capacity and reduce their cost of funding. At 30 June 2024, €415 million remains available to the lenders (31 December 2023: €571 million).

Capital commitments

For full details on Davy's capital commitments, see note 39 of the Group's 2023 Annual Report. The total of Davy's capital commitments at 30 June 2024 was €202 million (31 December 2023: €209 million). In turn, Davy obtain legally binding commitments from private clients to meet their share of potential future cash calls up to indicative levels as outlined in the individual investment memoranda. The total of such cash calls for H124 was €23 million (31 December 2023: €55 million). At 30 June 2024, there were no unpaid cash calls in respect of third-party investment providers (31 December 2023: €nil).

26 Retirement benefit obligations

The net IAS 19 pension surplus at 30 June 2024 was €795 million (31 December 2023 €682 million). This is shown on the balance sheet as a retirement benefit asset of €798 million (31 December 2023: €692 million) and a retirement benefit obligation of €3 million (31 December 2023: €10 million). The significant financial assumptions used in measuring the Group's net defined benefit pension surplus under IAS 19 are set out in the table below.

Financial assumptions	30 June 2024 % p.a.	31 December 2023 % p.a.
Irish Schemes
Discount rate	3.80	3.40
Inflation rate	2.35	2.30
UK Schemes
Discount rate	5.30	4.75
Consumer Price Inflation	2.65	2.55
Retail Price Inflation	3.25	3.15

Sensitivity of defined benefit obligation to key assumptions

The table below sets out how the defined benefit obligation would have been affected by changes in the significant actuarial assumptions that were reasonably possible.

Impact on defined benefit obligations	Increase / (decrease) 30 June 2024 €m	Increase / (decrease) 31 December 2023 €m
RoI schemes
Discount rate
Increase of 0.25%	(197)	(214)
Decrease of 0.25%	209	228
Inflation rate
Increase of 0.10%	52	57
Decrease of 0.10%	(51)	(56)
UK schemes
Discount rate
Increase of 0.25%	(37)	(40)
Decrease of 0.25%	39	43
RPI Inflation
Increase of 0.10%	8	9
Decrease of 0.10%	(8)	(9)

26 Retirement benefit obligations (continued)

The table below sets out the estimated sensitivity of plan assets to changes in equity markets and interest rates.

Impact on plan assets	Increase / (decrease) 30 June 2024 €m	Increase / (decrease) 31 December 2023 €m
Sensitivity of plan assets to a movement in global equity markets with allowance for other correlated diversified asset classes
Increase of 5.00%	69	73
Decrease of 5.00%	(69)	(73)
Sensitivity of liability-matching assets to a 25bps movement in interest rates
Increase of 0.25%	(254)	(269)
Decrease of 0.25%	269	285
Sensitivity of liability matching assets to a 10bps movement in inflation rates
Increase of 0.10%	68	70
Decrease of 0.10%	(66)	(69)

The remeasurement of the net defined benefit pension asset is recognised in other comprehensive income as set out in the following table.

	6 months ended 30 June 2024 €m	6 months ended 30 June 2023 €m
Present value of obligation gain	348	103
Fair value of plan assets (loss) / gain	(238)	66
Total gain	110	169

27 Subordinated liabilities

The principal terms and conditions of all subordinated liabilities are set out in note 42 of the Group's 2023 Annual Report.

	30 June 2024 €m	31 December 2023 €m
€500 million 4.750% Fixed Rate Reset Callable Subordinated Notes due 2034	498	–
€500 million 6.750% Fixed Rate Reset Callable Subordinated Notes due 2033	493	502
€500 million 1.375% Fixed Rate Reset Callable Subordinated Notes due 2031	468	466
£300 million 7.594% Fixed Rate Reset Callable Subordinated Notes due 2032	344	342
€300 million 2.375% Fixed Rate Reset Callable Subordinated Notes due 2029	296	290
Total subordinated liabilities	2,099	1,600

28 Liquidity risk and profile

The following tables summarise the maturity profile of the Group's non-derivative financial liabilities (excluding those arising from insurance and investment contracts in the Wealth and Insurance division) at 30 June 2024 and 31 December 2023, based on contractual undiscounted repayment obligations. The balances will not agree directly to the consolidated balance sheet as the table incorporates all cash flows, on an undiscounted basis, related to both principal and interest payments.

Unit-linked investment liabilities and unit-linked insurance liabilities with a carrying value of €8,387 million and €16,058 million respectively (31 December 2023: €7,692 million and €15,113 million respectively) are excluded from this analysis as their repayment is linked to the financial assets backing these contracts.

30 June 2024 Group's non-derivative financial liabilities Contractual maturity	Demand €m	Up to 3 months €m	3-12 months €m	1-5 years €m	Over 5 years €m	Total €m
Deposits from banks	210	331	–	–	–	541
Monetary Authorities secured funding	–	54	1,837	290	–	2,181
Customer accounts	91,633	4,976	3,227	1,279	–	101,115
Debt securities in issue	–	113	963	6,298	4,702	12,076
Subordinated liabilities	–	31	68	466	2,646	3,211
Lease liabilities	–	13	43	166	206	428
Contingent liabilities	721	68	89	105	10	993
Commitments	16,214	56	892	471	–	17,633
Short positions in trading securities	3	–	–	19	54	76
Total	108,781	5,642	7,119	9,094	7,618	138,254

31 December 2023 Group's non-derivative financial liabilities Contractual maturity	Demand €m	Up to 3 months €m	3-12 months €m	1-5 years €m	Over 5 years €m	Total €m
Deposits from banks	88	532	–	–	–	620
Monetary Authorities secured funding	–	65	1,141	1,456	–	2,662
Customer accounts	92,443	4,775	2,418	822	–	100,458
Debt securities in issue	–	75	207	6,853	4,230	11,365
Subordinated liabilities	–	34	40	357	1,997	2,428
Lease liabilities	–	14	43	169	218	444
Contingent liabilities	776	39	115	151	3	1,084
Commitments	16,554	43	911	623	–	18,131
Short positions in trading securities	1	–	–	68	36	105
Total	109,862	5,577	4,875	10,499	6,484	137,297

29 Fair values of assets and liabilities

A definition of fair value and the fair value hierarchy, along with a description of the methods, assumptions and processes used to calculate fair values of assets and liabilities is set out on pages 333 to 335 of the Group's 2023 Annual Report. At 30 June 2024, there have been no significant changes to those methods, assumptions, processes or the Group's policy for assessing transfers between the different levels of the fair value hierarchy.

Sensitivity of level 3 valuations

Derivative financial instruments

Certain derivatives are valued using unobservable inputs relating to counterparty credit such as credit grade, which are significant to their valuation. The effect of using reasonably possible alternative assumptions in the valuation of these derivatives at 30 June 2024 was immaterial. Where the impact of unobservable inputs is significant to the valuation of the asset or liability, it is categorised as level 3 on the fair value hierarchy.

In addition, a small number of derivative financial instruments are valued using significant unobservable inputs other than counterparty credit (level 3 inputs). However, changing one or more assumptions used in the valuation of these derivatives would not have a significant impact as they are entered into to hedge the exposure arising on certain customer accounts (see below), leaving the Group with no net valuation risk due to the unobservable inputs.

Loans and advances to customers held at fair value

These consist of assets mandatorily measured at FVTPL, of which €196 million (31 December 2023: €205 million) are 'Life loan mortgage products'. Unlike a standard mortgage product, borrowers do not make any periodic repayments and the outstanding loan balance increases through the life of the loan as interest due is capitalised. The mortgage is typically repaid out of the proceeds of the sale of the property. These assets are valued using discounted cash flow (DCF) models which incorporate unobservable inputs (level 3 inputs). Using reasonably possible alternative assumptions would not have a material impact on the value of these assets.

Other financial assets at FVTPL

A small number of these assets have been valued using DCF models and a discounted equity value method, which incorporates unobservable inputs (level 3). Certain private equity funds, which predominantly invest in properties, are valued with reference to the underlying property value which in itself incorporates unobservable inputs (level 3). Using reasonably possible alternative assumptions would not have a material impact on the value of these assets.

Interest in associates

Investments in associates, which are venture capital investments, are accounted for at FVTPL and are valued in accordance with the 'International Private Equity and Venture Capital Valuation Guidelines'. This requires the use of various inputs such as DCF analysis and comparison with the earnings multiples of listed comparative companies amongst others.

Although the valuation of unquoted equity instruments is subjective by nature, the relevant methodologies are commonly applied by other market participants and have been consistently applied over time.

As the inputs are unobservable, the valuation is deemed to be based on level 3 inputs. Using reasonably possible alternative assumptions would not have a material impact on the value of these assets.

Customer accounts

Customer accounts designated at FVTPL consist of deposits which contain an embedded derivative (typically an equity option). These instruments are typically valued using valuation techniques which use observable market data. The Group incorporates the effect of changes in its own credit spreads when valuing these instruments. The Group sources own credit spreads from independent brokers (level 3 inputs) as observable own credit spreads are not available. Where the impact of unobservable inputs is significant to the valuation of a customer account, that account is categorised as level 3 on the fair value hierarchy. Using reasonably possible alternative assumptions would not have a material impact on the value of these liabilities.

A small number of customer accounts are valued using additional unobservable inputs (level 3 inputs). However, changing one or more assumptions used in the valuation of these customer accounts would not have a significant impact as these customer accounts are hedged with offsetting derivatives (see above), leaving the Group with no net valuation risk due to those unobservable inputs.

Other liabilities

Other liabilities carried at fair value consist of contingent consideration of €23 million (31 December 2023: €33 million), representing most of the remaining consideration due on the acquisition of Davy, the payment of which is subject to certain criteria. The fair value is based on DCFs and probabilities of payment. As the probabilities are unobservable and their impact is significant to the valuation, the contingent consideration is categorised as level 3 on the fair value hierarchy.

Fair value on offsetting positions

Where the Group manages certain financial assets and financial liabilities on the basis of its net exposure to either market risks or credit risk, the Group applies the exception allowed under paragraph 48 of IFRS 13. That exception permits the Group to measure the fair value of a group of financial assets and financial liabilities on the basis of the price that would be received to sell a net long position (i.e. an asset) for a particular risk exposure or paid to transfer a net short position (i.e. a liability) for a particular risk exposure in an orderly transaction between market participants at the measurement date under current market conditions. Accordingly, the Group measures the fair value of the group of financial assets and financial liabilities consistently with how market participants would price the net risk exposure at the measurement date.

The following table sets out the level of the fair value hierarchy for financial assets and financial liabilities held at fair value.

		30 June 2024			31 December 2023
	Level 1	Level 2	Level 3	Total	Level 1	Level 2	Level 3	Total
	€m	€m	€m	€m	€m	€m	€m	€m
Financial assets held at fair value
Trading securities	161	3	–	164	72	–	–	72
Derivative financial instruments	1	3,669	8	3,678	4	4,317	20	4,341
Other financial assets at FVTPL	22,030	159	283	22,472	20,349	190	360	20,899
Loans and advances to banks	–	10	–	10	–	100	–	100
Financial assets at FVOCI	3,702	–	–	3,702	3,968	–	–	3,968
Loans and advances to customers	–	–	196	196	–	–	205	205
Interest in associates	–	–	80	80	–	–	79	79
	25,894	3,841	567	30,302	24,393	4,607	664	29,664

Financial liabilities held at fair value
Customer accounts	–	195	–	195	–	230	–	230
Derivative financial instruments	2	4,543	7	4,552	4	4,469	17	4,490
Debt securities in issue	–	194	–	194	–	267	–	267
Liabilities to customers under investment contracts	–	8,387	–	8,387	–	7,692	–	7,692
Short positions in trading securities	76	–	–	76	105	–	–	105
Other liabilities1	–	–	23	23	–	–	33	33
	78	13,319	30	13,427	109	12,658	50	12,817

¹In the table above 'other liabilities' relate to the contingent consideration recognised for the acquisition of Davy.

30 June 2024 Movements in level 3 assets	Loans and advances to customers at FVTPL €m	Other financial assets at FVTPL €m	Derivative financial instruments €m	Interest in associates €m	Total €m
Balance at 1 January 2024	205	360	20	79	664
Exchange adjustment	–	–	–	–	–
Total gains / (losses) in:
Profit or loss
Interest income	4	–	–	–	4
Net trading income	2	10	3	–	15
Share of results of associates	–	–	–	5	5
Revaluation	–	(2)	–	–	(2)
Total investment losses	–	(23)	–	–	(23)
Additions Disposals	– –	4 (9)	– –	8 (12)	12 (21)
Redemptions	(15)	(10)	–	–	(25)
Reclassifications	–	(47)	–	–	(47)

Transfers out of level 3
From level 3 to level 2	–	–	(17)	–	(17)
Transfers into level 3
From level 2 to level 3	–	–	2	–	2
Balance at 30 June 2024	196	283	8	80	567
Total unrealised gains / (losses) for level 3 assets included in profit or loss at the end of the period	5	(13)	(7)	5	(10)
Net trading income / (expense)	1	10	(7)	–	4
Interest income	4	–	–	–	4
Share of results of associates	–	–	–	5	5
Total investment losses	–	(23)	–	–	(23)

The transfer from level 3 to level 2 arose as a result of the availability of observable inputs at 30 June 2024. The transfer from level 2 to level 3 arose as a result of certain material inputs becoming unobservable.

31 December 2023 Movements in level 3 assets	Loans and advances to customers at FVTPL €m	Other financial assets at FVTPL €m	Derivative financial instruments €m	Interest in associates €m	Total €m
Balance at 1 January 2023	217	359	13	65	654
Exchange adjustment	–	–	–	–	–
Total gains / (losses) in:
Profit or loss
Interest income	8	–	–	–	8
Net trading income	7	5	22	–	34
Share of results of associates	–	–	–	4	4
Revaluation	–	–	–	–	–
Total Investment losses	–	(26)	–	–	(26)
Additions	–	100	–	13	113
Disposals	–	(5)	–	(3)	(8)
Redemptions	(27)	(46)	–	–	(73)
Reclassifications	–	(1)	–	–	(1)
Transfers out of level 3
From level 3 to level 2	–	(26)	(15)	–	(41)
Transfers into level 3
From level 2 to level 3	–	–	–	–	–
Balance at 31 December 2023	205	360	20	79	664
Total unrealised gains / (losses) for level 3 assets included in profit or loss at the end of the year	14	(21)	18	4	15
Net trading income	6	5	18	–	29
Interest income	8	–	–	–	8
Share of results of associates	–	–	–	4	4
Total investment losses	–	(26)	–	–	(26)

The transfer from level 3 to level 2 arose as a result of the availability of observable inputs at 31 December 2023. There were no transfers between levels 1 and 2, or from levels 1 and 2 to level 3.

		30 June 2024			31 December 2023
Movements in level 3 liabilities	Customer accounts €m	Derivative financial instruments €m	Other liabilities1 €m	Total €m	Customer accounts €m	Derivative financial instruments €m	Other liabilities1 €m	Total €m
Balance at 1 January	–	17	33	50	17	292	32	341
Exchange adjustment	–	–	–	–	–	–	–	–
Total (gains) / losses in:
Profit or loss
Net trading (income) / expense	–	1	–	1	3	(19)	–	(16)
Interest expense / (income)	–	–	(1)	(1)	–	–	1	1
Other comprehensive income	–	–	–	–	1	–	–	1
Disposals	–	–	(9)	(9)	–	–	–	–
Reclassifications	–	–	–	–	–	(247)	–	(247)
Transfers out of level 3
From level 3 to level 2	–	(11)	–	(11)	(21)	(11)	–	(32)
Transfers into level 3
From level 2 to level 3	–	–	–	–	–	2	–	2
Closing balance	–	7	23	30	–	17	33	50
Total unrealised losses for level 3 liabilities included in profit or loss at the end of the period
Net trading expense	–	4	–	4	–	17	–	17

¹'Other liabilities' relate to the contingent consideration recognised for the acquisition of Davy.

The transfers from level 3 to level 2 arose due to unobservable inputs becoming less significant to the fair value measurement of these liabilities. There were no transfers between levels 1 and 2 or from level 1 and 2 to level 3 for 30 June 2024. The transfer from level 2 to level 3 at 31 December 2023 arose as a result of certain material inputs becoming unobservable.

Quantitative information about fair value measurements using significant unobservable inputs (Level 3)

			Fair value		Range
Level 3 financial assets	Valuation technique	Unobservable input	30 June 2024 €m	31 Dec 2023 €m	30 June 2024 %	31 Dec 2023 %
Loans and advances to		Discount on market rate		205	4.5% - 7.0%	4.5% - 7.25%
customers	Discounted cash flow	Collateral charges	196		0% - 4.4%	0% - 5.6%
Other financial assets at FVTPL	Discounted cash flow	Discount rate	283	360	0% - 15%	0% - 15%
	Equity value less discount	Discount			0% - 68%	0% - 70%
	Market comparable property transactions	Yield			2.98% - 13.08%	2.85% - 12.17%
Derivative financial	Discounted cash flow /	Counterparty credit spread			0% - 1.25%	0% - 1.45%
instruments	Option pricing model	Own credit spread	8	20	0.3% - 1.6%	0.75% - 1.55%
Interest in associates	Market comparable companies	Price of recent investment	80	79
		Earnings multiple			–	–
		Revenue multiple

			Fair value		Range
Level 3 financial liabilities	Valuation technique	Unobservable input	30 June 2024 €m	31 Dec 2023 €m	30 June 2024 %	31 Dec 2023 %
Derivative financial	Counterparty credit spread Discounted cash flow /		7	17	0% - 1.25%	0% - 1.45%
instruments	Option pricing model	Own credit spread			0.3% - 1.6%	0.75% - 1.55%
Other liabilities	Discounted cash flow	Probabilities of the set conditions being met	23	33	50% - 100%	50% - 100%

Quantitative information about fair value measurements using significant unobservable inputs (Level 3) (continued)

Valuation techniques and unobservable inputs

In the tables above:
discount market rates represent a range of discount rates that market participants would use in valuing these assets;
holdings in real estate property funds (within other financial assets at FVTPL) are valued through market comparable property transactions;
counterparty and own credit spreads represent the range of credit spreads that market participants would use in valuing these contracts;
earnings and revenue multiples represent multiples that market participants would use in valuing these investments;
the Group does not disclose the ranges for interests in associates. Given the wide range of diverse investments and the correspondingly large difference in prices, the Group believes disclosure of ranges would not provide meaningful information without a full list of the underlying investments which would be impractical.

Financial assets and liabilities carried at amortised cost

The carrying amount and the fair value of the Group's financial assets and liabilities which are carried at amortised cost are set out in the table below. Items where the carrying amount is a reasonable approximation of fair value are not included, as permitted by IFRS 7.

	30 June 2024		31 December 2023
Financial instruments	Carrying amount €m	Fair values €m	Carrying amount €m	Fair values €m
Assets
Loans and advances to banks	2,249	2,249	1,807	1,807
Debt securities at amortised cost	5,989	6,003	5,715	5,757
Loans and advances to customers (including assets held for sale)	81,255	81,352	79,524	80,127
Liabilities
Deposits from banks	2,618	2,618	3,095	3,095
Customer accounts	100,600	100,615	99,953	99,940
Debt securities in issue	9,412	9,510	8,403	8,460
Subordinated liabilities	2,099	2,173	1,600	1,662

30 Post balance sheet events

31 Approval of interim report

The Board of Directors approved the Interim Report on 30 July 2024.

Other information

Consolidated average balance sheet and interest rates

The following tables show the average balances and interest rates of interest earning assets and interest bearing liabilities for 30 June 2024 and 31 December 2023. The calculations of average balances can be based on daily, weekly or monthly averages, depending on the reporting unit. The average balances used are considered to be representative of the operations of the Group and are presented on an underlying basis which excludes non-core items, see page 12 for further details. The explanation of the underlying business trends in the Group's NIM is outlined in the OFR.

	30 June 2024		31 December 2023
	Average Balance €m	Interest €m	Rate %	Average Balance €m	Interest €m	Rate %
Assets
Loans and advances to banks	30,968	645	4.19%	33,552	1,155	3.44%
Loans and advances to customers at amortised cost	79,855	1,633	4.11%	79,384	3,276	4.13%
Debt securities at amortised cost, financial assets at FVOCI and FVTPL	9,787	222	4.56%	9,390	360	3.83%
Total interest earning assets	120,610	2,500	4.17%	122,326	4,791	3.92%
Non interest earning assets	35,866	–	–	37,755	–	–
Total assets	156,476	2,500	3.21%	160,081	4,791	2.99%
Liabilities and shareholders' equity
Deposits from banks	2,719	68	5.03%	3,114	143	4.59%
Customer accounts	41,365	259	1.26%	40,676	290	0.71%
Debt securities in issue	9,284	287	6.22%	8,556	471	5.50%
Subordinated liabilities	1,785	68	7.66%	1,711	121	7.07%
Lease liabilities	391	5	2.57%	368	11	2.99%
Total interest bearing liabilities	55,544	687	2.49%	54,425	1,036	1.90%
Current accounts	58,562	–	–	60,213	1	–
Total interest bearing liabilities and current accounts	114,106	687	1.21%	114,638	1,037	0.90%
Other interest income	–	–	–	–	1	–
Non-trading derivatives (not in hedge accounting relationships - economic hedges)	–	11	–	–	71	–
Non interest bearing liabilities	29,594	–	–	29,290	–	–
Shareholders' equity and non-controlling interests	12,776	–	–	16,153	–	–
Total liabilities and shareholders' equity	156,476	698	0.90%	160,081	1,109	0.69%
Euro and sterling reference rates (average)
ECB deposit rate			3.97%			3.31%
3 month Euribor rate			3.87%			3.43%
Bank of England base rate			5.25%			4.68%
Sonia rate			5.19%			4.61%

'Interest' represents underlying interest income or expense recognised on interest bearing items, net of interest on derivatives which are in a hedge relationship with the relevant asset or liability. Strategic portfolio divestment income of €30 million has been excluded as non-core items in H124 (31 December 2023: €25 million).

Average loans and advances to customers volumes are presented net of Stage 3 impairment loss allowances.

Net interest outflows of €579 million (31 December 2023: €837 million net interest outflow) on all derivatives, designated as fair value hedges of 'current accounts', are presented together with gross interest income on 'loans and advances to customers' and not included in 'customer accounts', in order to present the yields on products on a consistent basis period on period.

Forward-looking statement

This document contains forward-looking statements with respect to certain of 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, 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, future share buybacks, 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, plans and objectives for future operations, and the continued impact of Russia's invasion of Ukraine and the Israeli-Palestinian conflict particularly on certain of the above issues and generally on the global and domestic economies. 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.

Such risks and uncertainties include, but are not limited to, those as set out in the 'Principal Risks and Uncertainties' section on page 26 and also the discussion of risk in the Risk Management Report in the Group's 2023 Annual Report.

Nothing in this document should be considered to be a forecast of future profitability, dividend forecast or financial position of the Group and none of the information in this document is or is intended to be a profit forecast, dividend forecast or profit estimate. Any forward-looking statement speaks only at the date it is made. The Group does not undertake to release publicly any revision to these forwardlooking statements to reflect events, circumstances or unanticipated events occurring after the date hereof.

For further information please contact:

Mark Spain

Group Chief Financial Officer Email: [email protected]

Eamonn Hughes

Chief Sustainability & Investor Relations Officer Email: [email protected]

Darach O'Leary

Head of Group Investor Relations Email: [email protected]

Damien Garvey

Head of Group External Communications and Public Affairs Email: [email protected]

Rates of exchange

Principal rates of exchange used in the preparation of the Interim Financial Statements are as follows:

	30 June 2024		30 June 2023		31 December 2023
	Average	Closing	Average	Closing	Average	Closing
€ / Stg£	0.8546	0.8464	0.8764	0.8583	0.8698	0.8691
€ / US\$	1.0813	1.0705	1.0807	1.0866	1.0813	1.1050

Credit Ratings

30 June 2024	31 December 2023
BOIG plc - Senior debt
Standard & Poor's BBB (Stable)	BBB (Stable)
Moody's A3 (Positive)	A3 (Positive)
Fitch1 BBB+ (Stable)	BBB+ (Stable)
The Governor and Company of the Bank of Ireland - Senior debt
Standard & Poor's A (Stable)	A (Stable)
Moody's A1 (Positive)	A1 (Positive)
Fitch1 A- (Stable)	A- (Stable)

1 On 9 July 2024, Fitch affirmed the BoIG plc and The Governor and Company of the Bank of Ireland ratings and revised the outlook to Positive (from Stable).

Stock exchange listings

Bank of Ireland Group plc is a public limited company incorporated in Ireland in 2016 with registration number 593672. Its ordinary shares, of nominal value €1.00 per share, have a primary listing on the Irish Stock Exchange, trading as Euronext Dublin and a premium listing on the London Stock Exchange.

Alternative performance measures

This section contains further information related to certain measures referred to in the key performance highlights, OFR and financial statements.

The OFR is prepared using IFRS and non-IFRS measures to analyse the Group's performance, providing period on period comparability. These performance measures are consistent with those presented to the Board and Group Executive Committee and include alternative performance measures as set out below. These performance measures may not be uniformly defined by all companies and accordingly they may not be directly comparable with similarly titled measures and disclosures by other companies. These measures should be considered in conjunction with IFRS measures as set out in the consolidated financial statements from page 41.

Annual Premium Equivalent (APE) is a common metric used by insurance companies. The approach taken by insurance companies is to take 100% of regular premiums, being the annual premiums received for a policy, and 10% of single premiums. This assumes that an average life insurance policy lasts 10 years and therefore taking 10% of single premiums annualises the single lump sum payment received over the 10 year duration.

Average cost of funds represents the underlying interest expense recognised on interest bearing liabilities and current accounts, net of interest on derivatives which are in a hedge relationship with the relevant liability. See pages 8 and 113 for further information.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Interest expense	Income statement	1,645	1,088
Exclude impact of FV hedges of current accounts	Average balance sheet	(579)	(284)
Exclude interest on non-trading derivatives (not in hedge accounting relationships)	Note 5	(379)	(359)
Underlying interest expense		687	445
Average interest bearing liabilities	Average balance sheet	114,106	114,859
Average cost of funds % (annualised)		(1.21%)	(0.78%)

Business income is net other income before other expenses / income and other valuation items. See page 9 for further details.

Constant currency: To enable a better understanding of performance, certain variances are calculated on a constant currency basis by adjusting for the impact of movements in exchange rates during the period as follows:

for balance sheet items, by reference to the closing rate at the end of the current and prior period ends; and
for items relating to the income statement, by reference to the current and prior period average rates.

Growth in customer deposits on a constant currency basis: The Group calculates growth in customer deposits on a constant currency basis. For this calculation the Group applies the prior period end rate in both periods so that the impact of movements in FX rates is eliminated.

Calculation	Source	30 June 2024 €m	31 December 2023 €m
Customer accounts	Note 23	100,795	100,183
Impact of foreign exchange movements		(461)	(245)
Customer accounts on a constant currency basis		100,334	99,938
Growth in customer accounts		151	738

Growth in loans and advances to customers on a constant currency basis: The Group calculates growth in loans and advances to customers (including held for sale) on a constant currency basis. For this calculation the Group applies the prior period end rate in both periods so that the impact of movements in FX rates is eliminated.

Calculation	Source	30 June 2024 €m	31 December 2023 €m
Loans and advances to customers (including held for sale)	Note 18	81,451	79,729
Impact of foreign exchange movements		(758)	(330)
Loans and advances to customers on a constant currency basis		80,693	79,399
Growth in loans and advances to customers		964	7,438

Gross yield represents the underlying interest income recognised on interest earning assets, net of interest on derivatives which are in a hedge relationship with the relevant asset. See pages 8 and 113 for further information.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Interest income	Income statement	3,477	2,890
Include impact of FV hedges of current accounts	Average balance sheet	(579)	(284)
Exclude interest on non-trading derivatives (not in hedge accounting relationships)	Note 4	(368)	(312)
Exclude portfolio divestment	Income statement - operating segments (OFR)	(30)	–
Underlying interest income		2,500	2,294
Average interest earning assets	Average balance sheet	120,610	122,679
Average gross yield % (annualised)		4.17%	3.77%

Gross yield - customer lending

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Interest income on loans and advances to customers	Note 4	2,102	1,826
Include impact of FV hedges of current accounts	Average balance sheet	(579)	(284)
Interest income on finance leases and hire purchase receivables	Note 4	140	103
Exclude portfolio divestments (net interest income)	Income statement - operating segments (OFR)	(30)	–
Underlying interest income on customer lending		1,633	1,645
Average customer lending assets	Average balance sheet	79,855	78,892
Average gross yield on customer lending % (annualised)		4.11%	4.20%

Gross yield - liquid assets

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Interest income on loans and advances to banks	Note 4	645	502
Interest income on debt securities at amortised cost	Note 4	129	76
Interest income on debt securities at FVOCI	Note 4	91	70
Interest income on other financial assets at FVTPL	Note 4	2	1
Underlying interest income on liquid assets		867	649

Loans and advances to banks	Average balance sheet	30,968	34,504
Debt securities at amortised cost and financial assets at FVOCI and FVTPL	Average balance sheet	9,787	9,283
Average interest earning liquid assets		40,755	43,787
Average gross yield on liquid assets % (annualised)		4.28%	2.99%

Liquid assets are comprised of cash and balances at central banks, loans and advances to banks, debt securities at amortised cost, financial assets at FVOCI and certain financial assets at FVTPL (excluding balances in Wealth and Insurance).

Liquidity Coverage Ratio (LCR) is calculated based on the Commission Delegated Regulation (EU) 2015/61 which came into force on 1 October 2015. Prepared on a regulatory group basis, in accordance with the Capital Requirements Directive (CRD IV), which comprises banking and other relevant financial institutions within the Bank of Ireland Group, but excludes non-banking related institutions such as insurance entities. For further information, see the Group's Pillar 3 disclosures (tab 1.3), available on the Group's website.

Loan to Deposit Ratio is calculated as being net loans and advances to customers (including assets held for sale) divided by customer deposits.

Calculation	Source	30 June 2024 €m	31 December 2023 €m
Loans and advances to customers	Balance sheet	81,451	79,729
Customer deposits	Balance sheet	100,795	100,183
Loan to Deposit ratio %		81%	80%

Net Impairment losses on loans and advances to customers at amortised cost (basis points) is the net impairment loss on loans and advances to customers at amortised cost divided by average gross loans and advances to customers at amortised cost.

Underlying net Impairment losses on loans and advances to customers at amortised cost (basis points) is the net impairment loss on loans and advances to customers at amortised cost excluding non-core, divided by average gross loans and advances to customers at amortised cost.

		Statutory		Underlying
Calculation	Source	30 June 2024 €m	30 June 2023 €m	30 June 2024 €m	30 June 2023 €m
Net impairment losses on loans and advances to customers at amortised cost	Note 13	(46)	(156)	(46)	(156)
Exclude portfolio divestment	Non-core items (OFR)	–	–	(1)	–
		(46)	(156)	(47)	(156)
Average gross loans and advances to customers		81,932	79,998	81,932	79,998
Net impairment losses on loans and advances to customers at amortised costs (bps) (annualised)		(11)	(39)	(12)	(39)

Net interest margin (NIM) is stated on an underlying basis. See page 8 for further details.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Net interest income	Income statement	1,832	1,802
Exclude portfolio divestment income	Non-core items (OFR)	(30)	–
Underlying net interest income		1,802	1,802
Average interest earning assets	Average balance sheet	120,610	122,679
Net interest margin % (annualised)		3.00%	2.96%

Net organic capital generation primarily consists of attributable profit after impairment and movements in regulatory deductions, and is calculated with reference to RWAs at the start of the period.

Net Stable Funding Ratio (NSFR) is prepared on a regulatory group basis, in accordance with the EU Capital Requirement Regulations and Directive, as amended, which requires the maintenance of a NSFR ratio greater than or equal to 100%, effective June 2021. For further information, see the Group's Pillar 3 disclosures (tab 1.3) available on the Group's website.

New lending volumes

Net new lending volumes represent loans and advances to customers drawn down during the period (including revolving credit facility activity) and portfolio acquisitions, net of repayments and redemptions.
Gross new lending volumes represent loans and advances to customers drawn down during the period and portfolio acquisitions.

Non-performing exposures (NPEs) are:

credit-impaired loans which includes loans where the borrower is considered unlikely to pay in full without recourse by the Group to actions such as realising security, and / or loans where the borrower is greater than or equal to 90 days past due and the arrears amount is material; and
other loans meeting NPE criteria as aligned with regulatory requirements.

NPE ratio is calculated as NPEs on loans and advances to customers at amortised cost (including loans and advances to customers measured at FVTPL and assets held for sale) as a percentage of the gross carrying value of loans and advances to customers at amortised cost.

Calculation	Source	30 June 2024 €m	31 December 2023 €m
Non-performing exposures	Loans and advances to customers (OFR)	2,429	2,519
Loans and advances to customers	Note 18	82,512	80,746
NPE ratio %		2.9%	3.1%

Return on assets is calculated as being statutory net profit / loss (being profit / loss after tax) (annualised) divided by total assets, in line with the requirement in the EU (Capital Requirements) Regulations 2014.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Profit for the period	Income statement	877	853
Total assets	Balance sheet	159,134	156,216
Return on assets (bps) (annualised)		111	110

Return on Tangible Equity (RoTE) is calculated as being profit attributable to ordinary shareholders divided by average shareholders' equity less average intangible assets and goodwill.

Return on Tangible Equity (adjusted) is calculated by adjusting the RoTE to exclude other expenses and other valuation items (net of tax). The average shareholders' tangible equity is adjusted for pension surplus and a CET1 ratio of 14.0% (30 June 2023: 14.0%), reflecting the Group's capital guidance.

		Reported		Adjusted
	30 June 2024 €m	30 June 2023 €m	30 June 2024 €m	30 June 2023 €m
Profit for the period attributable to shareholders	877	849	877	849
Distribution on other equity instruments - AT1 coupon	(34)	(34)	(34)	(34)
Other expenses and other valuation items, net of tax	–	–	(22)	(42)
Adjusted profit after tax	843	815	821	773
Annualised adjusted profit after tax	1,703	1,649	1,659	1,565
Shareholders' equity	11,640	11,090	11,640	11,090
Intangible assets and goodwill	(1,493)	(1,350)	(1,493)	(1,350)
Shareholders' tangible equity	10,147	9,740	10,147	9,740
Average shareholders' tangible equity	10,361	9,672	10,361	9,672
Adjustment for CET1 ratio at 14.0% (30 June 2023: 14.0%)	–	–	(775)	(365)
Adjustment for pension surplus	–	–	(785)	(850)
Adjusted average shareholders tangible equity	10,361	9,672	8,801	8,457
Return on Tangible Equity %	16.4%	17.0%	18.9%	18.5%

Statutory cost income ratio is calculated as other operating expenses and cost of restructuring divided by total operating income.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Other operating expenses	Income statement	1,100	1,031
Cost of restructuring programme	Income statement	25	12
Costs		1,125	1,043
Total operating income	Income statement	2,237	2,215
Statutory cost / income ratio %		50%	47%

Tangible Net Asset Value per share is calculated as shareholder equity less intangible assets and goodwill divided by the number of ordinary shares in issue, adjusted for treasury shares held for the benefit of life assurance policyholders at the period end.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Shareholder equity	Balance sheet	11,640	11,090
Less - intangible assets and goodwill	Balance sheet	(1,493)	(1,350)
Adjust for own shares held for the benefit of life assurance policyholders	Balance sheet	6	9
Tangible net asset value		10,153	9,749

Number of ordinary shares in issue		1,020	1,056
Exclude treasury shares held		(1)	(1)
		1,019	1,055

Tangible net asset value per share (cent)		996	924

Underlying excludes non-core items which are those items that the Group believes obscure the underlying performance trends in the business. See page 12 for further information.

Underlying cost income ratio is calculated on an underlying basis (excluding non-core items), as operating expenses excluding levies and regulatory charges divided by operating income, excluding other gains and other valuation items.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Other operating expenses	Income statement	1,100	1,031
Cost of restructuring programme	Income statement	25	12
		1,125	1,043
Exclude:
Levies and regulatory charges	Note 11	(111)	(110)
Cost of restructuring programme	Non-core items (OFR)	(25)	(12)
Acquisition costs	Non-core items (OFR)	(22)	(33)
Portfolio divestments (operating expenses)	Non-core items (OFR)	(6)	–
Other transformation programme costs	Non-core items (OFR)	–	19
Underlying costs		961	907

Operating income	Income statement	2,237	2,215
Exclude:
Financial instrument valuation adjustments (CVA, DVA, FVA) and other	Other income (OFR)	(40)	(28)
Portfolio divestments (operating income)	Non-core items (OFR)	(30)	–
Gross up of policyholder tax in the Wealth and Insurance business	Non-core items (OFR)	(14)	(14)
Investment valuation movement	Other income (OFR)	9	(22)
Liability management exercises	Non-core items (OFR)	4	–
Other expenses	Net other income (OFR)	4	1
Acquisition income	Non-core items (OFR)	(3)	–
Investment gains on treasury shares held for policyholders	Non-core items (OFR)	2	–
Underlying income		2,169	2,152

Underlying cost / income ratio %		44%	42%

Underlying divisional contribution reflects the underlying financial contribution of each division towards the consolidated Group underlying profit or loss, before tax, excluding non-core items which obscure the underlying performance of the business.

Underlying earnings per share is calculated as profit attributable to shareholders adjusted for non-core items, divided by the weighted average number of ordinary shares in issue, adjusted for average treasury shares.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Profit attributable to shareholders	Income statement	877	849
Distribution on other equity instruments - AT1 coupon	Note 16	(34)	(34)
Non-core items, including tax	Non-core items (OFR)	26	27
Adjustment for redemption of preference stock	Note 16	–	(24)
Underlying profit attributable to shareholders		869	818
Weighted average number of shares in issue, excluding treasury shares	Note 16	1,043	1,067
Underlying earnings per share (cent)		83.3	76.7

Underlying effective tax rate is calculated as the Group's tax charge adjusted for non-core items divided by the Group's profit before tax adjusted for non-core items.

Calculation	Source	30 June 2024 €m	30 June 2023 €m
Tax charge	Income statement	(203)	(172)
Adjusted to exclude tax on non-core items		15	15
Underlying tax charge		(188)	(157)

Profit before tax	Income statement	1,080	1,025
Adjusted to exclude non-core items	Non-core items (OFR)	11	12
Underlying profit before tax		1,091	1,037

Underlying effective tax rate		17%	15%

Wholesale funding is comprised of deposits by banks (including collateral received) and debt securities in issue.

For any abbreviations used in this document please refer to the abbreviations listing on pages 364 to 366 of the Group's 2023 Annual Report.

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Bank of Ireland Group plc 2 College Green Dublin 2 D02 VR66

Registered number 593672

AI Terminal

Bank of Ireland GP

1979_ir_2024-07-31_babe555c-9e4f-47e9-9361-6c257bd7c660.pdf

20 24

Inside this report

View this report online

Key performance highlights

Strong strategic and financial performance through our business model

Chief Executive's review

Delivering on our Strategic Pillars

Stronger Relationships

Simpler Business

Sustainable Company

Economic Outlook

H124 Business and Financial Performance

Outlook

Key highlights

Operating and financial review (incorporating risk management)

Basis of presentation

Summary consolidated income statement on an underlying basis

Net interest income

Net other income

Operating expenses

Net impairment losses on financial instruments (continued)

Non-core items

Transformation programme

Portfolio divestments

Acquisition costs

Gross-up for policyholder tax in the Wealth and Insurance business

Liability management exercises

Investment losses on treasury shares held for policyholders

Summary consolidated balance sheet

Summary consolidated balance sheet (continued)

Loans and advances to customers

Summary consolidated balance sheet (continued)

Liquid assets (after impairment loss allowance)

Other assets and other liabilities

Summary consolidated balance sheet (continued)

Customer deposits

Wholesale funding

Divisional review

Divisional income statement on an underlying basis - operating segments

Divisional income statement on an underlying basis - operating segments

Retail Ireland

Retail Ireland serves customers across a broad range of segments and sectors with financial products and services tailored to meet their needs.

The Group notes the following achievements under our strategic pillars for 30 June 2024:

Stronger relationships

Simpler business

Sustainable company

Compared to H123:

Wealth and Insurance

Stronger relationships

Sustainable company

Wealth and Insurance (continued)

Embedded value

Retail UK

The Group notes the following achievements under our three strategic pillars for 30 June 2024:

Stronger relationships

Simpler business

Sustainable company

Net impairment gains / (losses) on financial instruments

Compared to 31 December 2023:

Corporate and Commercial

The Group notes the following achievements under our three strategic pillars for 30 June 2024:

Stronger relationships

Simpler business

Sustainable company

Compared to H123:

Compared to 31 December 2023:

Group Centre

The Group notes the following achievements under our three strategic pillars for 30 June 2024:

Stronger relationships

Simpler business

Sustainable company

Income statement

Principal Risks and Uncertainties

Asset Quality

Asset Quality - Loans and advances to customers

Approach to measurement of impairment loss allowances

Credit Risk associated with geopolitical risk, inflation and interest rates