Irish Life & Permanent (IL&P) said it expected this year's earnings to be in line with market expectations and that the backdrop for its banking and life businesses was very positive for 2006.
In a pre-close trading statement the financial services firm said it expected total loan book growth to exceed 20 per cent for 2005, driven by strong mortgage lending.
Life sales were expected to show "high teens" growth for the year, with new business earnings in the mid-40 per cent range.
Shares in IL&P, which have risen 23 per cent over the past year, were down 2 cents at €16.68 in Dublin this afternoon, with the overall market up 0.3 per cent.
IL&P said a strong Irish economy with a buoyant labour market and opportunities provided by the maturity of SSIAs meant 2006 was expected to be "very positive" for both banking and life businesses.
The savings schemes begin maturing in mid-2006 and are expected to release billions of euros into the economy.
IL&P said domestic demand remained strong, with mortgage lending accelerating in the second half to reach an expected record level of gross new lending of around €6 billion for the year.
Its UK mortgage company, Capital Home Loans, was expected to show loan book growth of more than 30 per cent for the full year, despite a slowdown in new lending in the second half, it said. Income growth in banking was seen at around 5 per cent.
On the life side, IL&P said the new business margin was expected to be around 19 per cent, as previously indicated, and as such, was ahead of a target of 17 per cent.
Operating costs in the core life business would increase by around 9 per cent, reflecting increased sales activity.
Institutional inflows into its fund management business, ILIM, were estimated at €1.3 billion for the year, down from €1.6 billion in 2004.