Commentary on Results

. Commentary on Results Summary Profit and Loss Accounts     Half Year June 00 Euro m Half Year June 99 Euro m % Change Underlying % Change   Net interest income 985 843 17 5   Other income (inc. associates) 615 490 26 14   Total income 1,600 1,333 20 9   Staff costs 545 459 19 6   Other costs 299 247 21 7   Depreciation and amortisation 80 53 51 10   Total operating expenses 924 759 22 6   Operating profit before provisions (inc. associates) 676 574 18 12   Provisions for bad and doubtful depts 70 35 101 64   Other provisions (1) (3)       Total provisions 69 32 117 -3   Profit on disposal of property 2 -       Group profit on ordinary activities before taxation 609 542 12 8   Taxation 167 157 -     Group profit on ordinary activities after taxation 442 385 15     Minority interests and non-equity dividend 28 20 38     Group profit attributable 414 365 13   The Group results for the half-year are not directly comparable with June 1999 due to a change in the composition of the Group. The current half-year includes Bank Zachodni ('BZ') in which AIB took a majority shareholding on 16 September 1999. The underlying percentage change adjusts for the impact of the BZ acquisition in Poland, currency factors and the impact of US$ 5 million securities gains in the USA in 1999. Overall Results Group profit on ordinary activities before taxation amounted to Euro 609 million, up 12% on the half-year to June 1999 profit of Euro 542 million. Basic earnings per share increased by 13% to EUR 48.5c per share with tangible earnings per share increasing by 16% to EUR 49.9c per share. Group profit on ordinary activities after taxation was higher by 15% at Euro 442 million and profit attributable to ordinary shareholders at Euro 414 million was up 13%. Deposit Interest Retention Tax (DIRT) - The Group has a contingent liability in respect of DIRT. Note 18 of this release sets out relevant disclosure of the issue. Operating profit before provisions Operating profit before provisions, including associates increased by 18% to Euro 676 million for the half-year to June 2000. Net interest income Net interest income increased by 17% to Euro 985 million for the half-year to June 2000. When the impact of the BZ acquisition and currency factors are excluded, net interest income was up 5%. Loans to customers and customer accounts increased by 9% and 7% respectively since December 1999 on a Group basis. Excluding currency factors, loans to customers increased by 7% while customer accounts grew by 6%. The net interest margin was 3.10%, a decrease of 17 basis points on the half-year to June 1999. The decrease mainly occurred in AIB Bank and Allfirst, both operating in very competitive markets.