AIB has put a brave face on a 47 per cent drop in profits in 2001. Mr Buckley drew attention to its "powerful and resilient franchises", its strong balance sheet, and stressed that, even after the fraud, AIB was well capable of supporting it ambitious plans for the future.
It was a good performance and, with some accounting wizardry, the bank managed to boost its much-diminished profits to €612 million. This helped to keep the stock markets calm even after an admission that the fraud had gone undetected for five years.
The shares fell back marginally to €11.95 still well below the €13.62 level before the fraud was announced earlier this month. Despite Mr Buckleys optimistic overtures, no market analysts are forecasting that the shares will climb above €13 for the forseeable future.
Mr Buckley says the fraud has had little impact on AIB's day-to-day business so far. "There has not been a significant adverse customer reaction. We must be doing something right," he said yesterday.
This year he expects the bank to be able to bounce back with profit growth of 10 per cent on last year's pre-fraud figures but analysts think this may be very ambitious.
Its core business in the Republic delivered good results and Mr Buckley said it had been working hard to reassure customers that it was not affected by the events at Allfirst. The bank can be less sure-footed about its overseas businesses, particularly those in the US and in Poland.
The markets will welcome Mr Buckley's statement that it will review its investment in the US in the next six to nine months in the light of recent events. Ironically, Allfirst was set to bring in profits for the first time in three years before one of its foreign exchange traders reversed its fortunes.
The bank insists it is focused on repairing the damage done to its brand in the short term and to build on its success in winning new business in 2001. This will not be an easy task as Allfirst has already lost hundreds of millions of dollars worth of deposits to rivals in the Baltimore area. More importantly, AIB needs to convince the markets that it has the management skills to manage its US business.
The Allfirst fraud has diverted attention away from AIB's interests in Poland - BZ WBK bank. AIB has invested in new technology and opened branches as part of its strategic plans to generate large profits eventually from this emerging economy.
Until February 6th, 2002, AIB's management team had the confidence of shareholders to deliver its stated objectives. Now the reputation of that team is in tatters and its ability to run a geographically diversified bank in question.
The bank has said it will act swiftly to implement the findings and recommendations of former US banker, Mr Eugene Ludwig, who is investigating the fraud at Allfirst.
Shareholders, customers and staff will be the final judge of whether it does enough s actions have been sufficient to to reassure them about the future of AIB.
