AIB Group half-year results 2026: profit hits €939 million as guidance improves

AIB Group has reported a strong first half of 2026, combining stable net interest income with lending growth, higher other income and substantial shareholder distributions.

Profit after tax reached €939 million, while return on tangible equity, or RoTE, was 23.2%. RoTE measures profit against the tangible shareholder capital employed by the bank and is a useful indicator of profitability.

The bank also upgraded parts of its full-year guidance and announced an interim dividend worth €406 million. That sits alongside the ongoing €1 billion share buyback programme.

Investors can read the original company announcement for the complete half-year report.

AIB's key half-year figures

Metric	H1 2026	Comparison
Profit after tax	€939 million	Not disclosed
Earnings per share	42.2c	Not disclosed
RoTE	23.2%	Not disclosed
Net interest income	€1.87 billion	€1.87 billion in H1 2025
Net interest margin	2.68%	2.78% in H1 2025
Other income	€411 million	Up 15%
Operating costs	€1.00 billion	Up 2%
New lending	€7.5 billion	Up 10%
Gross loans	€74.5 billion	Up 3% from December 2025
Customer deposits	€118.8 billion	Up 1.3% from December 2025
CET1 ratio	16.1%	16.2% in December 2025
Interim dividend	19.528c per share	Almost 60% increase

The broad picture is encouraging. Income increased, costs remained controlled and customer lending expanded across the business.

Interest income remained resilient

Net interest income, which is broadly the difference between interest earned and interest paid, was stable at €1.87 billion. That is an important result given the effect of lower interest rates.

Net interest margin, or NIM, declined from 2.78% to 2.68%. This measures the profitability of the bank's interest-earning assets after funding costs. However, average volume growth helped offset pressure from lower rates.

There was also an improvement during the half. AIB's exit NIM increased from 2.65% in the first quarter to 2.71% in the second quarter.

Management now expects full-year net interest income to exceed €3.8 billion, rather than its previous guidance of approximately €3.8 billion. This assumes an European Central Bank deposit rate of 2.5% and a Bank of England rate of 4.00% at the end of December 2026.

This guidance upgrade follows the positive momentum described in the earlier AIB Group Q1 2026 performance update.

Other income provided another source of growth

Other income increased by 15% to €411 million, helped by gains from loan disposals, investment securities disposals and equity investments.

AIB consequently raised its full-year other income forecast to approximately €800 million, compared with previous guidance of more than €750 million.

There is some nuance here. Net fee and commission income fell by 3% to €328 million. Higher wealth and insurance income was offset by lower customer account and card income, with the previous year benefiting from one-off items.

Assets under management grew organically by 6% to €19.4 billion, while related revenue increased by 7%. The planned acquisition of Belfast-based Legacy Wealth Management, which has £700 million of assets under management, should further expand AIB's wealth operation if regulatory approval is received. Completion is expected in the second half.

Lending growth was broad-based

New lending rose by 10% to €7.5 billion, helping gross loans increase by €2.2 billion to €74.5 billion.

Irish mortgage lending reached €2.0 billion and AIB reported a 30% mortgage market share. Green mortgages represented 60% of new mortgage lending, up from 58% in the comparative period.

New lending to Irish small and medium-sized enterprises was €0.9 billion, while Capital Markets lending increased by 4% to €2.2 billion. Climate and Infrastructure Capital lending doubled to €1.2 billion after weaker activity in the prior year.

Overall, green and transition lending accounted for 41% of new lending. AIB has now deployed €26 billion against its €30 billion Climate Action target.

Management expects customer loans to grow by approximately 5% across 2026.

Costs and credit quality require attention

Operating costs increased by 2% to €1.00 billion, reflecting salary inflation and higher variable pay. Lower average staff numbers provided a partial offset, with full-time equivalent employees decreasing by 2% to 10,144.

The cost-income ratio remained unchanged at 44%, meaning AIB continues to operate below its medium-term ceiling of 50%. Full-year cost growth is still expected to be approximately 2%.

Credit quality remained described as robust, although non-performing exposures increased from €1.6 billion at the end of 2025 to €1.75 billion. They now represent 2.35% of gross loans, compared with 2.2% previously.

The credit impairment charge was €91 million, equivalent to a 25 basis point cost of risk. This was within AIB's full-year guidance range of 20 to 30 basis points, but the increase in non-performing exposures is worth monitoring.

Capital supports a larger dividend and buyback

AIB's common equity tier 1, or CET1, capital ratio was 16.1%. CET1 is a key measure of a bank's capacity to absorb losses.

The reported ratio excludes the first-half profit pending a final decision on the year-end payout. That profit generated approximately 170 basis points of CET1 capital, supporting scope for shareholder returns.

AIB declared an interim dividend of 19.528c per share, amounting to approximately €406 million. The record date is 14 August 2026 and payment is scheduled for 6 October 2026.

The €1 billion buyback announced in March is also progressing. By 29 July, approximately 52 million shares had been repurchased for around €510 million at a volume-weighted average price of €9.79 per share.

AIB maintains an ordinary dividend payout policy of 40% to 60%, with possible additional distributions as capital moves towards its CET1 target of more than 14%.

What matters for AIB investors now

The strongest features are the 23.2% RoTE, growing loan book, controlled costs and upgraded income guidance. AIB also has substantial capital flexibility, supporting both the dividend and buyback.

The main pressure point is the interest-rate environment. Net interest margin declined year on year, even though the second-quarter exit rate improved. Other income also benefited from disposal and investment gains, so investors should distinguish these contributions from recurring fee growth.

Non-performing exposures have increased, albeit from relatively low levels, while macroeconomic and geopolitical uncertainty remains part of the outlook.

For 2026, AIB expects RoTE above 20%, net interest income above €3.8 billion and approximately 5% customer loan growth. Attention will then turn to Strategy 2030 and refreshed medium-term targets, which are due with the full-year results in March 2027.

You can follow further company updates on the dedicated AIB Group PLC share page.