Permanent TSB Group (PTSB) H1 2025 earnings summary

Executive summary

• Customer deposits rose 7% year-on-year to €25.2bn in H1 2025, with 24k new current and deposit accounts opened and strong growth in retail and current accounts.

• Gross new lending increased 66% year-on-year to €1.6bn, driven by an 84% rise in new mortgage lending and a 23% increase in business banking lending; mortgage book grew 3% year-on-year and business banking book 14%.

• Launched new Sustainability Strategy 2025-2027, with €560m in green lending (up 110% YoY) and €26m in impact lending.

• Operating profit before exceptionals was €51m, down 17% year-on-year; underlying profit before tax was €51m, with profit before tax at €19m due to lower net interest income and higher exceptional costs.

• Strategic focus on deepening customer relationships, diversifying income, and enhancing operational efficiency, with relationship NPS up 2 points year-on-year.

Financial highlights

• Net interest income was €288m, down 7% year-on-year, mainly due to lower ECB rates and higher deposit costs; net interest margin declined to 2.02%.

• Total operating income was €322m, down 4% year-on-year; operating expenses (excluding exceptionals) were €246m, with total operating expenses at €271m, down 1% year-on-year.

• Cost-to-income ratio increased to 76%, up 3 points year-on-year.

• Net fees and commissions increased 35% to €31m, supported by current account pricing changes and earlier recognition of payments receipt.

• EPS (pre-exceptional) was €0.04 (4.0c), down 54% year-on-year; return on tangible equity (ROTE) was 2.9%.

Outlook and guidance

• Management remains confident in delivering on the 2025-2027 strategy, reiterating 2025 and medium-term guidance, with a cost-to-income ratio target of 60% by 2027.

• Deposit growth expected to slow in H2, but positive momentum in lending and deposits to continue; FY 2025 NIM expected to remain above 2.0%.

• Plan to restart dividend payments in 2026, targeting a 40% payout over time, subject to regulatory approval; first distribution based on 2025 performance.

• Guidance assumes no changes to risk weight densities until IRB mortgage model review is complete.

• 2027 ROTE target is c. 9% with increased capital return.