Strong growth in mortgage lending last year was one of the key factors contributing to a 24 per cent rise in pre-tax profits to €71.7 million at IIB Bank.
The bank, a subsidiary of the Belgian KBC bank and insurance group, owns IIB Homeloans in the Republic which grew its new residential mortgage business by €1.9 billion in 2003. Its net mortgage growth was €1.5 billion - of this, €1.25 billion was in residential mortgages and €250,000 in other loans.
This brings its total residential mortgage book to €5 billion with the bank claiming to have a 13-14 per cent share of the Irish mortgage market, making it the State's fifth-biggest lender.
IIB Bank chief executive Mr Ted Marah said the demand for mortgages had remained strong in the first quarter of this year although the pace of growth had slowed slightly. He also stated that the bank would consider any potential acquisitions in the Irish market to boost its presence.
The bank considered launching a takeover bid for First Active and had made initial contact with the bank before Royal Bank of Scotland emerged with its €887 million offer last year.
At that time, sources at the bank suggested that it did not expect to pay anywhere near that amount for First Active.
Yesterday, Mr Marah said that while it was not interested in acquiring a branch network, it would evaluate any takeover opportunities that arose but was not currently in talks with any financial institution.
"We would look at anything that came on the market and we have in the past. We would want to be very careful as we have a very good relationship with our brokers and wouldn't want to interfere with that," he said.
About a third of IIB's profits were generated from its mortgage business, with the remainder coming from its corporate banking and treasury businesses.
The bank has been very active in providing corporate loans to companies moving from a stock exchange listing to becoming a private company.
It has provided financing and has been the senior arranger in transactions involving Independent News & Media, Smurfit and was involved in the failed Dr Tony Mullin's led management buy-out of Barlo.
It is also involved in the growing level of activity in infrastructural development through public private partnerships which is expected to benefit from changes in EU rules on Government borrowing through these structures. The bank specialises in project finance with its international activities managed in Dublin.
IIB's treasury and capital markets division also reported a strong performance with profits growth mainly driven by increased customer numbers and the introduction of new products. It also offers private banking and wealth management services.
The bank paid a €40 million dividend to KBC on the back of its 2003 performance, up from €28 million in the previous year.
