Bank of Ireland Group of Ireland Group Report and Accounts for the year ended 31 March 2000 ... plc, Green P roperty plc, L ondon City Airport Ltd and Coillte Teoranta

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  • Report and Accountsfor the year ended 31 March 2000

    Bank o

    f Irela

    nd G



    ort and


    unts for the year end

    ed 31 M

    arch 2000

    Bank of Ire cover 2000 25/5/00 10:26 am Page 1

  • Contents

    Court of Directors 2

    Governors Statement 4

    Group Chief Executives Operating and Financial Review 8

    Five Year Summary 25

    Report of Directors 29

    Corporate Governance Statement 33

    Remuneration Report 36

    Statement of Directors Responsibilities 41

    Auditors Report 42

    Group Profit and Loss Account 44

    Group Balance Sheet 46

    Other Primary Statements 49

    Group Cash Flow Statement 50

    Notes to the Accounts 51

    Average Balance Sheet 105

    Group Profit and Loss Account (, IR, US$, STG) 107

    Group Balance Sheet (, IR, US$, STG) 108

    Stockholder Information 109

    Principal Business Units and Addresses 112

    Index 117

  • The Court(L to R)

    Anthony D Barry +#Deputy Governor

    Appointed to the Court in 1993. Appointed DeputyGovernor in October 1997 and senior independentdirector in November 1998. Former Chief Executiveand former Chairman of CRH plc. A Director ofGreencore Group plc, DCC plc and Ivernia West plc.

    (Age 65)

    Paul M DAlton *Group Chief Financial Officer

    Joined the Bank in 1991 as Group Chief FinancialOfficer. Appointed to the Court in January 2000.Formerly Chief Executive Finance, Aer LingusGroup plc. A Fellow of the Institute of CharteredAccountants in Ireland.

    (Age 48)

    Maurice A Keane *Group Chief Executive

    Joined the Bank in 1958. Appointed an AssistantGeneral Manager in 1973 and General ManagerFinancial Control in 1978. Appointed to the Court asa Managing Director in 1983. Appointed DeputyGroup Chief Executive in March 1991 and GroupChief Executive in February 1998. Director of Bristol& West plc.

    (Age 59)

    Roy E Bailie, OBEAppointed to the Court in 1999. Chairman of W&GBaird Holdings Ltd and of the Northern IrelandTourist Board. A Director of the Bank of England andUTV plc and formerly a member of the NorthernIreland Advisory Board of the Bank of Ireland.

    (Age 56)

    E Patrick Galvin + #Appointed to the Court in 1994. Former Chairmanand Chief Executive of Waterford Crystal Ltd. ADirector of Gallaher (Dublin) Ltd, Greencore Groupplc and Irish Shell Ltd. Chairman of the Board ofGovernors of The National College of Ireland.

    (Age 67)

    Patrick J A MolloyAppointed to the Court in 1983 as an ExecutiveDirector. Group Chief Executive from 1991 until heretired from that position in January 1998,remaining as a Non-Executive Director. Chairman ofCRH plc, Bristol & West plc and Enterprise Ireland. A Director of eircom plc and Kingspan Group plc.

    (Age 62)

    Raymond Mac Sharry #Appointed to the Court in 1993. A former EUCommissioner for Agriculture, Chairman of eircomplc, Green Property plc, London City Airport Ltd andCoillte Teoranta. A Director of Jefferson SmurfitGroup plc and Ryanair Holdings plc.

    (Age 62)

    Howard E Kilroy ##Governor

    Appointed to the Court in 1991 and Governorfollowing the 1991 Annual General Court. Retires asGovernor and as a Director of the Bank followingthe 2000 Annual General Court. Former Presidentand Chief Operations Director of Jefferson SmurfitGroup plc. A Director of the Jefferson SmurfitGroup plc and CRH plc.

    (Age 64)

    Mary P Redmond +Appointed to the Court in 1994. A solicitorspecialising in labour law. In her professionalcapacity as a solicitor acts for the Group in relationto aspects of labour law. A Director of JeffersonSmurfit Group plc, Campbell Bewley Group Ltd andfounder of the Irish Hospice Foundation.

    (Age 49)

    Laurence G CrowleyGovernor Designate

    Appointed to the Court in 1990 and DeputyGovernor from 1995 to 1997. Will become Governorfollowing the 2000 Annual General Court. Chairmanof PJ Carroll and Co. Ltd, a Director of ElanCorporation plc, J Rothschild InternationalAssurance plc and a number of other companies.Executive Chairman of the Michael SmurfitGraduate School of Business at University College,Dublin.

    (Age 63)

    Denis OBrienAppointed to the Court in April 2000. Chairman ofESAT Telecom Group plc. A Director of Oakhill plcand a number of other companies.

    (Age 42)

    Brian J Goggin *Chief Executive Corporate & Treasury

    Joined the Bank in 1969. Served in a variety ofsenior management positions in the United States,Britain and Ireland. He has been in his currentposition since 1996. Appointed to the Court inJanuary 2000.

    (Age 48)

    Margaret Downes ++Appointed to the Court in 1986 and DeputyGovernor from 1993 to 1995. A past president of the Institute of Chartered Accountants in Irelandand The Federation of European Accountants.Chairman of BUPA Ireland Ltd and Gallaher (Dublin)Ltd, a Director of Ardagh plc, BUPA in the UK and anumber of other companies.

    (Age 67)

    Richard BurrowsAppointed to the Court in March 2000. Chairmanand Chief Executive of Irish Distillers Group Ltd andcurrently President of the Irish Business andEmployers Confederation (IBEC).

    (Age 54)

    Lord Armstrong of Ilminster, GCB CVO +Appointed to the Court in 1997. Chairman of 3iBioscience Investment Trust plc. A Director of TheBristol & West Building Society (now Bristol & Westplc) from 1988 until his retirement in December1997 and its Chairman from 1993 to December 1997and a director of a number of other companies.

    (Age 73)

    * Executive Director++ Chairman of the Group Audit Committee+ Member of the Group Audit Committee## Chairman of the Group Remuneration

    and the Group Nominations Committees

    # Member of the Group Remuneration and the Group Nominations Committees


  • 4

    Howard E KilroyGovernor

    Bank of Ireland

  • Stockholders of the Bank may take

    considerable satisfaction from the

    performance of the business as we enter

    the new millennium. For the seventh

    successive year, Return on Equity (ROE)

    has exceeded 20% and the average ROE

    during the past five years has been in

    excess of 24%.

    The financial services sector, both in

    Ireland and elsewhere, has seen

    unprecedented change, significantly

    intensified competition from new entrants

    and through new channels, major shifts in

    the margin potential of segments of the

    business and sea changes in the macro

    economic environment, especially in the

    new low interest regime within the

    Eurozone. Some observers have been

    pessimistic about the effects of these

    changes on banks and this has impacted

    adversely on stock valuations. Bank of

    Ireland has successfully met and

    surmounted these challenges and,

    I believe, will continue to do so.

    In the final analysis, the key measure of

    the success of any business will be found

    in the returns it achieves for its owners,

    the stockholders. The Directors and

    Management of Bank of Ireland are clear

    in their focus on Stockholder value, which

    we measure not only in terms of point in

    time dividend payments and stock

    valuation but also in the sustainability of

    the business going forward. Through a

    focus on competitive products and

    customer value, the Group has

    demonstrated that its extensive customer

    base is a powerful source of profit growth

    and that, despite the growing intensity of

    competition, it can recruit new customers

    and grow market share.

    The pace of change which staff have

    experienced and facilitated, and which

    is now a constant in the financial

    services sector, has not diminished the

    sense of tradition and shared values

    which shape the character of the

    organisation and influence its actions.

    5Report and Accounts 2000

    Governors Statement

  • 6 Bank of Ireland


    Throughout the past decade, the Group has been engaged in

    continuous adaptation to new market forces, including the

    influence of e-commerce. In the immediate future, the pace of

    transformation will accelerate as we implement the Groups

    growth strategies in the areas of network configuration, new

    delivery channels, streamlined management and administration

    systems and cost management.

    We have been acutely conscious of the growing role of the

    Internet as a critical channel for bank products and services. Our

    experience of this new technology has been very satisfactory and

    customers have responded positively to the e-commerce

    channels and payment systems which we have already provided.

    The pace of customer migration to electronic banking has been

    such that there is now a clear rationale for a fundamental review

    of the entire delivery system. The Group has undertaken such a

    review and has begun implementation of a strategy which will see

    considerable further investment in e-commerce and supporting IT

    infrastructure. This will be balanced by some reduction in the

    physical infrastructure, although we see a continuing pivotal role

    for the branch network in the delivery of the more complex

    banking products.

    The Group has given a clear commitment to achieve optimum

    cost efficiency levels in all of its operations and specific

    programmes towards the achievement of this goal are underway

    in a number of business units. Announcements have already

    been made concerning the amalgamation of businesses in Great

    Britain and Northern Ireland and the integration of International

    Banking and Treasury. Re-organisation of the