Underlying profits declined more modestly, down 3pc to €175m. That reflects the impact of lower European Central Bank interest rates over the year, which squeezed lending margins.
The bank did not comment on the sale in its annual results on Thursday or during a press conference with journalists but that process, understood to be moving into a second round, is now the key focus for management and shareholders.
The proposed dividend is the bank’s first since 2008 and the start of the global financial crisis that eventually saw it nationalised. If the sale process goes ahead as planned it will be taxpayers’ only dividend extracted from the lender since its bailout.
The dividend of €10m, or 1.835 cents per share, will mostly be paid to the exchequer which owns 57pc of the bank.
The bank indicated that a bigger dividend could have been paid out, but it opted not to in light of the ongoing sales process. The bank is now very well capitalised with a core equity tier one (CET1) capital ratio, a standard measure of capital, of 17.5pc, which is well above both the bank’s own target and its regulatory obligations.
That’s been boosted by a combination of updated EU banking regulations and a Central Bank decision this year to accept the bank’s internal ratings-based (IRB) model for mortgages, which in essence determines how much it can lend versus the capital available, and had been punishingly high since the crash.
PTSB CEO Eamonn Crowley* said 2025 had been a transformational year for the lender.
“The Bank’s balance sheet continued to grow as customers responded to the strength of our brand and product offering. Deposits increased by 6pc, our mortgage book grew by over 3pc, and our Business Banking (SME and Asset Finance) portfolio rose by 9pc,” he said,
Mortgage lending is the bank’s main business and it increased its market share of new mortgage lending to around 20pc of the market, he said.
That was up from 16pc a year earlier, in part thanks to more competitive pricing on the back of a more a favourable capital position. Non-mortgage consumer lending and business lending both grew, helping diversify a lending book historically totally dominated by homeloans.
For would-be buyers of the bank, costs will be a big focus both in the sale process and afterwards.
Total operating costs reduced 2pc to €519m last year including regulatory charges that were lower than expected at €25 million due to not incurred charges for the ECB’s Single Resolution Fund or Deposit Guarantee Scheme during the year.
Excluding these charges, the closely watched Cost Income Ratio was 75pc, high by modern bank standards.
Costs are set to decline further after the lender cut more than 300 jobs last year through voluntary severance scheme and natural attrition. The voluntary severance scheme is expected to generate annualised savings of €21m over time.
However the cost of running PTSB is significantly higher than the 33pc Cost Income Ratio at potential buyer Bawag, for example, suggesting a takeover could trigger significant rounds of cost cutting.
This article was amended on March 5 at 9.30 to correct the name of PTSB CEO Eamonn Crowley*.
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