Bank of Ireland has announced losses of €1.4 billion for 2012 which is down from €1.5 billion at the end of the previous year. While the impairment charge for the bank fell to €1.7 billion, down from €1.9 billion.

10% of home loans are in arrears which is up from 7.4%, while 23% of buy to let loans are in also arrears.

The bank says it is focused on key levers to re-build profitability.

It says its total operating income for the year ended December 31st of €1,880 million was 9% lower than the previous year.

The report says this came from a €10 billion - or 7% - reduction in the Group’s average interest earning assets, as well as a fall in the net interest margin from 1.33% to 1.25%. This lower margin reflected the relatively high cost of customer deposits, particularly in the first half of the year, and "the continuing negative impact of historically low official interest rates on earnings from certain of the Group’s assets".

It adds that re-building the net interest margin is one of the Group’s key priorities.

Marginal fall in operating costs

Separately operating expenses for the group fell to €1,638 million for the year ending December 2012, compared to €1,645 million the previous year. This it says was primarily driven by efforts "to reduce costs and deliver efficiencies".

Bank of Ireland Chief Executive is Richie Boucher.

He told Newstalk's Business Editor Ian Guider that the bank is working closely with struggling homeowners.