State saving schemes, managed by the National Treasury Management Agency (NTMA), are continuing to attract large inflows of cash, reflecting the public's lingering mistrust of the banks.
According to An Post, which sells the products on behalf of the NTMA, the State's overall savings fund grew by €1.9 billion to more than €18 billion last year, representing a three-fold increase since 2008.
The schemes now account for about 16 per cent of all personal savings.
In the wake of the financial crash tens of thousands of savers flocked to the State schemes because of uncertainty over bank deposits.
Last year’s figures did not, however, reflect the impact of the NTMA’s decision in December to lower interest rates associated with the schemes.
This followed extensive lobbying of the Department of Finance by banks which claimed the rates were making their products uncompetitive.
The savings figures were contained in An Post’s latest annual report, which showed the State company recorded an operating loss of €11.4 million last year.
An Post said an exceptional credit of €17.1 million, relating to a change in the company’s pension scheme as well as an offset for future voluntary redundancies, resulted in an overall group operating profit of €5.7 million and a profit after tax of €5.9 million.
Last year, it successfully concluded an agreement with staff to address a €229 million deficit in the staff’s pension scheme.
The company, which is engaged in a substantial cost-control process triggered by declining traditional mail volumes, reduced its full-time equivalent (FTE) staff last year by 335,
The company has already cut this number by 1,000 since 2010 and plans to further reduce FTE numbers by 1,000 by the end of 2018.
An Post said it recorded a 22 per cent growth in contract parcels and packet volume last year driven, in the main, by online shopping.
The company said that while its traditional mail volume fell 2 per cent this represented an improvement on the 5 per cent contraction in 2012.
An Post said the quality of its service performances for inbound international mail of 94.7 per cent and 89.5 per cent for outbound international mail had exceeded targets.
The company also noted its recent success in retaining the contract to operate the National Lottery as part of the winning Premier Lotteries Ireland consortium.
It said its partnership with UK operator Camelot, which is owned by Canada's Ontario Teachers' Pension Plan, would ensure the continued success of the lottery franchise "in providing funds for good causes and a solid return on this strategic business investment".
Commenting on the results, An Post chairman Christoph Mueller said that while the improvement in the company's finances was welcome, it is now critical to create a long term financial model to ensure the financial strength required for a sustainable national postal service.
“A new roadmap for the next five years has been developed. We will continue to grow An Post as the best provider of everyday postal, retail, communication and financial services in the Irish market.”
He said the company’s universal service obligation - the Monday to Friday pick-up and deliver service - incurred a substantial loss in 2013 and it was cross-subsidised by the Group’s other commercial activities, notably new business.
“We intend to continue the provision of this service in the coming years; however this may not be sustainable on an ongoing basis as traditional mail volumes are further substituted by new technologies,” he added.
