Banking

Analysis: As rate cuts loom will AIB’s net interest income hold up or ‘sink like a stone’?

State officials warned ECB rate cuts could hurt AIB’s profits. We asked experts how the bank is faring as the prospect of interest reductions draw near

Alastair Ryan, a research analyst at Bank of America, said the AIB’s post-cut decline in net interest income would be less dramatic than its growth. Picture: Fergal Phillips

A memo sent to Michael McGrath late last year revealed significant scepticism within the department over the sustainability of Irish banks’ bumper 2023 profits.

In December, government officials warned that despite the performances of both AIB and PTSB last year, their share prices at the end of 2023 prompted doubt in markets over the profit surge.

Irish banks, with the bulk of their business in mortgages, are particularly susceptible to interest rate shifts – leaving ...