Trading Statement
Summary by AI BETAClose X
8 May 2026
Permanent TSB Group Holdings plc ('the Bank')
TRADING STATEMENT - Q1 2026 UPDATE
Comment by Eamonn Crowley, Chief Executive:
"PTSB has made a positive start to 2026, with higher margins and a larger balance sheet delivering revenue growth of 10% in the first quarter. This also contributed to a reduction in our cost/income ratio to 72%. Asset quality remains robust, and our funding and capital positions are strong.
Our mortgage business continues to perform well as our refreshed pricing resonated with customers. New mortgage market share in Q1 was c. 19%, and with a strong pipeline of new business we are comfortable with an outlook of c. 20% for the current year. Meanwhile, Business Banking delivered a strong performance, with new lending up 18%, while drawdowns doubled in consumer term lending following a major overhaul of the Bank's suite of personal loans last year.
We were also pleased to recently announce the Board's recommended offer by BAWAG Group, of 297 cents per share for the entire issued share capital of the Bank, following a rigorous and competitive Formal Sale Process. We believe new ownership as part of a pan-European and US banking group will support the next phase of PTSB's growth, while strengthening our role as a pillar bank in the Irish retail banking market and deliver an even better experience for our customers."
KEY HIGHLIGHTS (all comparisons Q1 2026 vs. Q1 2025 unless otherwise stated)
· Total operating income up 10%, or 6% on an underlying basis
· Net interest margin of 2.13%, up 10bps
· Total operating costs up 6%, or 1% on an underlying basis (excluding timing differences)
· Cost/Income ratio of 72%, 4 ppts lower
· Asset quality remains strong with no impairment charge in Q1
· New mortgage market share of c. 19%
· New business banking lending (SME and Asset Finance) up 18%
· New personal term lending up 105%
· Total gross loans of €22.7 billion, up 3%
· Customer deposits of €25.6 billion, up 3%
· The Bank maintains a very strong capital position with a pro-forma CET1 ratio of 17.9%[1]
FINANCIAL PERFORMANCE (all comparisons Q1 2026 vs. Q1 2025 unless otherwise stated)
Income
Net interest income in Q1 increased 9%, reflecting both higher margins and higher average interest earning assets. The net interest margin (NIM) in Q1 was 2.13% which compares with 2.03% for Q1 2025. NIM benefited from a one-off catch-up adjustment and on an underlying basis was c. 2.11%.
The increase in NIM reflects the impact of lower interest rates across deposit liabilities, particularly our term balances. In addition, we continue to benefit from a roll-over of maturing fixed rate mortgages onto higher prevailing rates. Mortgage rate reductions announced by the Bank in January 2026 contributed some offsetting impact. We continue to expect NIM to exceed 2.10% for the year.
Net fees and commissions were up 25%, boosted by the earlier recognition of income in our payments business. Adjusting for this, net fees and commissions were broadly unchanged. Other income in the period was minimal and similar to Q1 2025.
Operating Costs
Total operating costs were up 6% in Q1, with costs excluding regulatory charges up 4%. This was mainly due to a timing difference in the awarding of annual pay increases, which were paid earlier in 2026 than 2025. Adjusting for this timing difference, underlying costs were up 1%. The Bank continues to prioritise cost optimisation, with payroll savings due to a lower headcount and tighter third-party supplier management helping to offset the impact of inflationary pressures.
The Bank's cost/income ratio was 72% in Q1 versus 76% in Q1 2025 and remains on track to meet our cost/income target of <70% for the year.
Asset Quality
Asset quality remains strong and the Bank recorded no impairment charge in Q1. Non-performing loans at end March 2026 were marginally higher relative to the year-end, due to a change in the definition of default linked to our IRB model review. NPLs at end Q1 were 1.4% of gross loans which is unchanged from year-end, and overall credit performance is stable with no signs of deterioration.
The Bank will continue to closely monitor the impact of international events on the Irish economy. However, notwithstanding heightened uncertainty, PTSB is well provisioned and has consistently utilised conservative macro-economic scenarios in impairment modelling. Meanwhile, the review of our non-mortgage IFRS9 models remains ongoing with implementation scheduled for H2 2026.
BALANCE SHEET & BUSINESS PERFORMANCE
Customer loans
Total gross customer loans on the balance sheet rose to €22.7 billion at end March 2026, up €0.1 billion relative to December 2025 or 3% YoY.
This was driven by growth of 3% in our core mortgage book. Our share of new mortgage business was c. 19% in Q1, however our pipeline is strong and hence we expect our market share to move back towards a level of c. 20%. The reduction in mortgage fixed rates announced in January continues to support our effort to offer choice and deliver competition in the market, particularly in the first-time buyer segment, while securing a high level of retentions on our back book.
Meanwhile, we continued to make strong progress in diversifying our income, with new lending in business banking up 18% and new personal term lending doubling relative to Q1 2025 following a major overhaul of the Bank's suite of personal loans last year. This contributed to growth in the business banking book of 10% and growth in our personal term lending book of 25%.
Funding and liquidity
Customer deposits were €25.6 billion at end March 2026 which was unchanged when compared with end December 2025. Growth was 3% on a YoY basis. Current account balances grew slightly in Q1 which was offset by a slight reduction in corporate balances. Term deposits were broadly unchanged during the quarter as the Bank successfully retained a large proportion of maturing higher rate deposits.
The loan to deposit ratio of 88% and liquidity coverage ratio of 269% at end March 2026 provide the Bank with a strong liquidity position and a secure funding source for future growth in lending volumes. As previously indicated, we are reviewing our issuance requirements over the coming years in light of our very strong MREL position.
Following our recent announcement in relation to the Formal Sale Process, Moody's affirmed the ratings of Permanent TSB Group Holdings Plc and Permanent TSB Plc. Moody's also upgraded the outlook on Permanent TSB Group Holdings Plc long-term senior unsecured debt and issuer ratings to positive, and indicated that a successful acquisition by BAWAG AG could lead to a ratings upgrade of one notch.
Capital
The Bank's common equity tier 1 (CET1) ratio at end March 2026 remains strong at a pro-forma 17.9% under our new approved IRB mortgage models which is comfortably above our regulatory minimum. This compares with a year-end outturn of 15.9% or 17.5% on a pro-forma basis. The Bank's proposed dividend of €10 million has been deducted from own funds in calculating CET1.
The Bank's leverage ratio at end March 2026 was 6.6%, compared with 6.5% at December 2025 and remains very strong for a bank with our high residential mortgage exposure.
OUTLOOK
The Bank has had a positive start to the year, and guidance remains in line with prior market communications.
- Ends -
For further information please contact:
|
Scott Rankin Head of Investor Relations Email: scott.rankin@ptsb.ie Phone: +353 87 001 0504 |
Ed Micheau Corporate Affairs & Communications Phone: +353 86 803 7155 |
Note on Forward-Looking Information:
This announcement contains forward-looking statements, which are subject to risks and uncertainties because they relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Bank or the industry in which it operates, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements referred to in this paragraph speak only as at the date of this announcement. The Bank undertakes no obligation to release publicly any revision or updates to these forward-looking statements to reflect future events, circumstances, unanticipated events, new information or otherwise except as required by law or by any appropriate regulatory authority.
[1] CET1 under new IRB models, inclusive of unaudited Q1 profits and net of proposed dividend. The Group's reported CET1 was 17.8% at end Q1 and excludes Q1 profits.
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