##### Table of Contents









SECURITIES AND EXCHANGE COMMISSION


WASHINGTON, DC 20549


FORM 20-F


|                                         |  |   |  |                                                                                                         
|---------------------------------------- |  | - |  | --------------------------------------------------------------------------------------------------------
|(Mark One)                               |  | o |  | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR
    12(g)
    OF THE SECURITIES EXCHANGE ACT OF 1934
|OR                                      
|                                         |  | x |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934                
|For the fiscal year ended March 31, 2006
|OR                                      
|                                         |  | o |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934            
|OR                                      
|                                         |  | o |  | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(D)
    OF THE SECURITIES EXCHANGE ACT OF 1934         
|                                        
|                                         |  |   |  | Date of event requiring this shell company report                                                       
|                                         |  |   |  | For the transition period
    from                 to                                                   
|Commission file number: 1-14452         

THE GOVERNOR AND COMPANY OF


THE BANK OF IRELAND


(Exact name of registrant as specified in its charter)


IRELAND


(Jurisdiction of incorporation or organization)


LOWER BAGGOT STREET, DUBLIN 2, IRELAND


(Address of principal executive offices)


+353 1 6615933


(Telephone number of principal executive offices)




|                                                                                                                   |  |                                          
|------------------------------------------------------------------------------------------------------------------ |  | -----------------------------------------
|Title of each class                                                                                                |  | Name of each exchange on which registered
|                                                                                                                   |  |                                          
| Ordinary Stock (nominal value of
    0.64 each)                                                                 |  | The New York Stock Exchange*             
| American Depositary Shares, each representing four
    units of Ordinary Stock (nominal value of
    0.64 each) |  | The New York Stock Exchange              



|  |                                                                                                                                                                                                                  
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | Not for trading, but only in connection with the registration of
    American Depositary Shares representing such Ordinary Stock,
    pursuant to the requirements of the Securities and Exchange
    Commission.












[X] [     ]




[     ] [X]




[X] [     ]






|                            |                            |                              
|--------------------------- | -------------------------- | -----------------------------
|Large accelerated file  [X] | Accelerated filer  [     ] | Non-accelerated file  [     ]



[     ] [X]




[     ] [X]










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2



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The Governor and Company of The Bank of Ireland


ANNUAL REPORT ON FORM 20-F


Table of Contents


|     |  |                                                                          |  |      |    | 
|---- |  | ------------------------------------------------------------------------ |  | ---- | -- | 
|     |  |                                                                          |  | Page |   
|     |  |                                                                          |  |      |   
|Item |  | Caption                                                                  |  |      |    | 
|     |  | Presentation of Information                                              |  |      | 5  | 
|     |  | Forward Looking Information                                              |  |      | 5  | 
|     |  | Definitions                                                              |  |      | 5  | 
|     |  | Reporting Currency                                                       |  |      | 5  | 
|     |  | Exchange Rates                                                           |  |      | 6  | 
|    
|     |  | Part I                                                                   |  |      |    | 
|1    |  | Identity of Directors, Senior
    Management & Advisors (not applicable) |  |      | 7  | 
|2    |  | Offer Statistics & Expected
    Timetable (not applicable)               |  |      | 7  | 
|3    |  | Key Information                                                          |  |      | 7  | 
|     |  | Selected Financial Data                                                  |  |      | 7  | 
|     |  | Risk Factors                                                             |  |      | 11 | 
|4    |  | Information on the Company                                               |  |      | 12 | 
|     |  | General                                                                  |  |      | 12 | 
|     |  | Principal Capital Expenditures and
    Divestitures                      |  |      | 12 | 
|     |  | Recent Developments                                                      |  |      | 13 | 
|     |  | Business Overview                                                        |  |      | 14 | 
|     |  | Strategy                                                                 |  |      | 14 | 
|     |  | Corporate Structure                                                      |  |      | 15 | 
|     |  | Description of Property                                                  |  |      | 21 | 
|     |  | Competition                                                              |  |      | 21 | 
|     |  | Supervision and Regulation                                               |  |      | 23 | 
|     |  | The Irish Economy                                                        |  |      | 27 | 
|4A   |  | Unresolved Staff Comments                                                |  |      | 27 | 
|5    |  | Operating & Financial Review
    and Prospects                           |  |      | 27 | 
|     |  | Critical Accounting Estimates and
    Judgements                         |  |      | 28 | 
|     |  | Liquidity and Capital Resources                                          |  |      | 30 | 
|     |  | Analysis of Results of Operations                                        |  |      | 31 | 
|     |  | Average Balance Sheet and Interest Rates                                 |  |      | 51 | 
|     |  | Description of Assets &
    Liabilities                                  |  |      | 56 | 
|6    |  | Directors, Senior Management and
    Employees                           |  |      | 84 | 
|     |  | Directors and Senior Management                                          |  |      | 84 | 
|     |  | Remuneration of Directors and Officers                                   |  |      | 87 | 
|     |  | Corporate Governance Statement                                           |  |      | 89 | 
|     |  | Court of Directors                                                       |  |      | 89 | 
|     |  | Court Committees                                                         |  |      | 95 | 
|     |  | Employees                                                                |  |      | 95 | 
|     |  | Stock options                                                            |  |      | 96 | 

3



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|        |  |                                                                                                     |  |      |     | 
|------- |  | --------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|        |  |                                                                                                     |  | Page |    
|        |  |                                                                                                     |  |      |    
|7       |  | Major Stockholders and Related Party
    Transactions                                               |  |      | 97  | 
|        |  | Control of Registrant                                                                               |  |      | 97  | 
|        |  | Related Party Transactions                                                                          |  |      | 97  | 
|        |  | Description of US stockholders                                                                      |  |      | 98  | 
|        |  | Relations with Stockholders                                                                         |  |      | 98  | 
|8       |  | Financial Information                                                                               |  |      | 99  | 
|        |  | Dividend Policy                                                                                     |  |      | 99  | 
|        |  | Legal Proceedings                                                                                   |  |      | 99  | 
|        |  | Prospective Accounting Changes                                                                      |  |      | 99  | 
|9       |  | The Offer and Listing                                                                               |  |      | 101 | 
|        |  | Nature of Trading Market                                                                            |  |      | 101 | 
|10      |  | Additional Information                                                                              |  |      | 102 | 
|        |  | Charter and Bye-Laws                                                                                |  |      | 102 | 
|        |  | Exchange controls and other limitations
    affecting security holders                              |  |      | 107 | 
|        |  | Taxation                                                                                            |  |      | 107 | 
|        |  | Documents available through the SEC                                                                 |  |      | 110 | 
|11      |  | Quantitative and Qualitative Disclosures
    about Market Risk                                      |  |      | 110 | 
|        |  | Analysis of Financial Condition                                                                     |  |      | 110 | 
|        |  | Risk Management and Control                                                                         |  |      | 113 | 
|12      |  | Description of Securities other than
    Equity Securities (not applicable)                         |  |      | 122 | 
|       
|        |  | Part II                                                                                             |  |      |     | 
|13      |  | Defaults, Dividend Arrearages &
    Delinquencies (not applicable)                                  |  |      | 123 | 
|14      |  | Material Modifications to the Rights of
    Security Holders & Use of Proceeds
    (not applicable) |  |      | 123 | 
|15      |  | Controls and Procedures                                                                             |  |      | 123 | 
|16      |  | A. Audit Committee Financial
    Expert                                                             |  |      | 123 | 
|        |  | B. Code of Ethics                                                                                   |  |      | 123 | 
|        |  | C. Principal Accountant Fees and
    Services                                                       |  |      | 124 | 
|        |  | D. Exemptions from the Listing Standards
    for Audit Committees                                   |  |      | 124 | 
|        |  | E. Purchases of Equity Securities by the
    Issuer and Affiliated Purchasers                       |  |      | 124 | 
|       
|        |  | Part III                                                                                            |  |      |     | 
|17      |  | Financial Statements                                                                                |  |      | 125 | 
|18      |  | Financial Statements                                                                                |  |      | 125 | 
|19      |  | Exhibits                                                                                            |  |      | 125 | 
|EX-4.1 
|EX-4.4 
|EX-12.1
|EX-12.2
|EX-13.1
|EX-13.2



4



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PRESENTATION OF INFORMATION


20-F, 









FORWARD-LOOKING INFORMATION







DEFINITIONS











REPORTING CURRENCY







5



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##### Table of Contents








EXCHANGE RATES







|                                   |  |                      |        |  |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|---------------------------------- |  | -------------------- | ------ |  | ---- |  | ------ | ---- |  |  | ------ |  |  | ---- | ------ |  |  |  | ------ | 
|                                   |  | Year ended March 31, |       
|                                   |  |                      |       
|                                   |  | 2006                 |        |  | 2005 |  |        | 2004 |  |  | 2003   |  |  | 2002 |       
|                                   |  |                      |        |  |      |  |        |      |  |  |        |  |  |      |       
|                                   |  | (dollars per )      |       
|Euro/dollar rates:                 |  |                      |        |  |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|March 31                           |  |                      | 1.2139 |  |      |  | 1.2969 |      |  |  | 1.2292 |  |  |      | 1.0900 |  |  |  | 0.8717 | 
|Average(1)                         |  |                      | 1.2163 |  |      |  | 1.2653 |      |  |  | 1.1808 |  |  |      | 1.0033 |  |  |  | 0.8803 | 
|High                               |  |                      | 1.3093 |  |      |  | 1.3625 |      |  |  | 1.2848 |  |  |      | 1.1062 |  |  |  | 0.9535 | 
|Low                                |  |                      | 1.1667 |  |      |  | 1.1801 |      |  |  | 1.0621 |  |  |      | 0.8750 |  |  |  | 0.8370 | 
|March 31 rate used by the Group(2) |  |                      | 1.2104 |  |      |  | 1.2964 |      |  |  | 1.2224 |  |  |      | 1.0895 |  |  |  | 0.8724 | 
|Average rate used by the Group(2)  |  |                      | 1.2126 |  |      |  | 1.2647 |      |  |  | 1.1796 |  |  |      | 1.0051 |  |  |  | 0.8804 | 





|                                   |  |                      |        |  |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|---------------------------------- |  | -------------------- | ------ |  | ---- |  | ------ | ---- |  |  | ------ |  |  | ---- | ------ |  |  |  | ------ | 
|                                   |  | Year ended March 31, |       
|                                   |  |                      |       
|                                   |  | 2006                 |        |  | 2005 |  |        | 2004 |  |  | 2003   |  |  | 2002 |       
|                                   |  |                      |        |  |      |  |        |      |  |  |        |  |  |      |       
|                                   |  | (STG£ per )         |       
|Euro/sterling rates:               |  |                      |        |  |      |  |        |      |  |  |        |  |  |      |        |  |  |  |        | 
|March 31 rate used by the Group(2) |  |                      | 0.6964 |  |      |  | 0.6885 |      |  |  | 0.6659 |  |  |      | 0.6896 |  |  |  | 0.6130 | 
|Average rate used by the Group(2)  |  |                      | 0.6826 |  |      |  | 0.6834 |      |  |  | 0.6926 |  |  |      | 0.6460 |  |  |  | 0.6145 | 






|    |                                                                                                  
|--- | -------------------------------------------------------------------------------------------------
|(1) | The average of the Noon Buying Rates on the last day of each
    month during the financial year.
|   
|(2) | The rates used by the Group in the preparation of its
    consolidated financial statements.     

6



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PART 1





Item 1     IDENTITY OF
DIRECTORS, SENIOR MANAGEMENT & ADVISORS







Item 2     OFFER STATISTICS
& EXPECTED TIMETABLE







Item 3     KEY INFORMATION


FIRST TIME ADOPTION OF INTERNATIONAL FINANCIAL REPORT
STANDARDS (IFRS)







SELECTED FINANCIAL DATA




F-88 F-105






7



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SELECTED CONSOLIDATED FINANCIAL DATA


Table 1


|                                                                                        |  |                                     |         |                            |      |  |         |      |  |  |         |  
|--------------------------------------------------------------------------------------- |  | ----------------------------------- | ------- | -------------------------- | ---- |  | ------- | ---- |  |  | ------- | -
|                                                                                        |  | At and for the Financial Year Ended |        
|                                                                                        |  | March 31,                           |        
|                                                                                        |  |                                     |        
|                                                                                        |  | 2006(1)                             |         |                            | 2006 |  |         | 2005 | 
|                                                                                        |  | IFRS                                |         |                            | IFRS |  |         | IFRS | 
|                                                                                        |  |                                     |         |                            |      |  |         |      | 
|                                                                                        |  | $m                                  |         |                            |     
|                                                                                        |  |                                     |         | (in  millions, except per |     
|                                                                                        |  |                                     |         | unit amounts and           |     
|                                                                                        |  |                                     |         | percentages)               |     
|Income Statement Data                                                                   |  |                                     |         |                            |      |  |         |      |  |  |         |  
|Amounts in accordance with IFRS:                                                        |  |                                     |         |                            |      |  |         |      |  |  |         |  
|Interest income                                                                         |  |                                     | 7,617   |                            |      |  | 5,954   |      |  |  | 4,263   |  
|Interest expense                                                                        |  |                                     | (4,666  | )                          |      |  | (3,647  | )    |  |  | (2,332  | )
|Net interest income                                                                     |  |                                     | 2,951   |                            |      |  | 2,307   |      |  |  | 1,931   |  
|Insurance net premium income                                                            |  |                                     | 1,661   |                            |      |  | 1,298   |      |  |  | 1,791   |  
|Fees and commissions income                                                             |  |                                     | 1,167   |                            |      |  | 912     |      |  |  | 1,163   |  
|Fees and commissions expense                                                            |  |                                     | (217    | )                          |      |  | (170    | )    |  |  | (263    | )
|Net trading income                                                                      |  |                                     | 38      |                            |      |  | 30      |      |  |  | 66      |  
|Life assurance investment income and gains                                              |  |                                     | 800     |                            |      |  | 625     |      |  |  | 695     |  
|Other operating income                                                                  |  |                                     | 210     |                            |      |  | 165     |      |  |  | 138     |  
|Profit on disposal of business activity                                                 |  |                                     | 225     |                            |      |  | 176     |      |  |  | 11      |  
|Total Operating Income                                                                  |  |                                     | 6,835   |                            |      |  | 5,343   |      |  |  | 5,532   |  
|Increase in insurance contract liabilities and claims paid                              |  |                                     | (2,131  | )                          |      |  | (1,666  | )    |  |  | (2,222  | )
|Total Operating Income, net of Insurance Claims                                         |  |                                     | 4,704   |                            |      |  | 3,677   |      |  |  | 3,310   |  
|Operating expenses                                                                      |  |                                     | (2,584  | )                          |      |  | (2,020  | )    |  |  | (2,051  | )
|Impairment losses                                                                       |  |                                     | (132    | )                          |      |  | (103    | )    |  |  | 21      |  
|Share of profit of associated undertakings and joint ventures                           |  |                                     | 58      |                            |      |  | 45      |      |  |  | 30      |  
|Profit before taxation                                                                  |  |                                     | 2,046   |                            |      |  | 1,599   |      |  |  | 1,310   |  
|Taxation                                                                                |  |                                     | (388    | )                          |      |  | (303    | )    |  |  | (256    | )
|Profit for the period                                                                   |  |                                     | 1,658   |                            |      |  | 1,296   |      |  |  | 1,054   |  
|Profit attributable to minority interests                                               |  |                                     | (12     | )                          |      |  | (9      | )    |  |  | (1      | )
|Profit attributable to stockholders                                                     |  |                                     | 1,670   |                            |      |  | 1,305   |      |  |  | 1,055   |  
|Per Unit of Ordinary Stock                                                              |  |                                     |         |                            |      |  |         |      |  |  |         |  
|Earnings per unit of
    0.64 ordinary
    stock                                       |  |                                     | 174.5c  |                            |      |  | 136.4c  |      |  |  | 111.1c  |  
|Diluted earnings per unit of
    0.64 ordinary
    stock                               |  |                                     | 173.2c  |                            |      |  | 135.4c  |      |  |  | 110.2c  |  
|Dividends(2)                                                                            |  |                                     | 67.2c   |                            |      |  | 52.5c   |      |  |  | 45.6c   |  
|Number of shares used in EPS calculation (in millions)                                  |  |                                     | 947     |                            |      |  | 947     |      |  |  | 942     |  
|Number of shares used in Diluted EPS calculation (in millions)                          |  |                                     | 954     |                            |      |  | 954     |      |  |  | 950     |  
|Balance Sheet Data                                                                      |  |                                     |         |                            |      |  |         |      |  |  |         |  
|Amounts in accordance with IFRS:                                                        |  |                                     |         |                            |      |  |         |      |  |  |         |  
|Total assets                                                                            |  |                                     | 207,699 |                            |      |  | 162,354 |      |  |  | 127,780 |  
|Loans and advances to customers (net of allowance for losses on
    loans and advances) |  |                                     | 129,524 |                            |      |  | 101,246 |      |  |  | 79,836  |  
|Loans and advances to banks                                                             |  |                                     | 13,530  |                            |      |  | 10,576  |      |  |  | 8,347   |  
|Allowance for losses on loans and advances                                              |  |                                     | (459    | )                          |      |  | (359    | )    |  |  | (319    | )
|Deposits by Banks                                                                       |  |                                     | 41,337  |                            |      |  | 32,312  |      |  |  | 20,865  |  
|Customer Accounts                                                                       |  |                                     | 78,946  |                            |      |  | 61,710  |      |  |  | 60,185  |  
|Debt Securities in issue                                                                |  |                                     | 47,096  |                            |      |  | 36,814  |      |  |  | 21,217  |  
|Subordinated liabilities                                                                |  |                                     | 8,306   |                            |      |  | 6,493   |      |  |  | 4,086   |  
|Minority interests                                                                      |  |                                     | 58      |                            |      |  | 45      |      |  |  | 135     |  
|Share capital                                                                           |  |                                     | 848     |                            |      |  | 663     |      |  |  | 663     |  
|Share premium account                                                                   |  |                                     | 981     |                            |      |  | 767     |      |  |  | 767     |  
|Retained profit                                                                         |  |                                     | 4,261   |                            |      |  | 3,330   |      |  |  | 2,424   |  
|Other reserves                                                                          |  |                                     | 1,027   |                            |      |  | 803     |      |  |  | 629     |  
|Own shares held for the benefit of life assurance policyholders                         |  |                                     | (301    | )                          |      |  | (235    | )    |  |  | (206    | )
|Stockholders equity                                                                    |  |                                     | 6,816   |                            |      |  | 5,328   |      |  |  | 4,277   |  

8



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Table 2


|                                                      |         |                                               |         |        |                                                          |  |         |            |  |      |            |       |      |            |         |       |            |  |        |        |  |  |        |       | 
|----------------------------------------------------- | ------- | --------------------------------------------- | ------- | ------ | -------------------------------------------------------- |  | ------- | ---------- |  | ---- | ---------- | ----- | ---- | ---------- | ------- | ----- | ---------- |  | ------ | ------ |  |  | ------ | ----- | 
|                                                      |         | At and for the Financial Year Ended March 31, |        
|                                                      |         |                                               |        
|                                                      |         |                                               |         | 2005   |                                                          |  | 2004    |            |  | 2003 |            |       | 2002 |           
|                                                      |         | 2006                                          |         |        | 2006(1)                                                  |  |         | (restated) |  |      | (restated) |       |      | (restated) |         |       | (restated) | 
|                                                      |         |                                               |         |        |                                                          |  |         |            |  |      |            |       |      |            |         |       |            | 
|                                                      |         | $m                                            |         |        | (in  millions, except per unit amounts and percentages) | 
|Amounts in accordance with U.S. GAAP:(9)              |         |                                               |         |        |                                                          |  |         |            |  |      |            |       |      |            |         |       |            |  |        |        |  |  |        |      
|Net income attributable to holders of ordinary stock: |         |                                               | 1,027   |        |                                                          |  | 803     |            |  |      | 814        |       |      |            | 912     |       |            |  | 1,114  |        |  |  | 681    |      
|Net income per unit of ordinary stock                 |         |                                               |         |        |                                                          |  |         |            |  |      |            |       |      |            |         |       |            |  |        |        |  |  |        |      
|                                                      | Basic   |                                               |         | 108.5c |                                                          |  |         | 84.8c      |  |      |            | 86.4c |      |            |         | 94.9c |            |  |        | 112.4c |  |  |        | 68.7c | 
|                                                      | Diluted |                                               |         | 107.7c |                                                          |  |         | 84.2c      |  |      |            | 85.7c |      |            |         | 94.3c |            |  |        | 111.4c |  |  |        | 68.1c | 
|Stockholders equity                                  |         |                                               | 6,380   |        |                                                          |  | 4,976   |            |  |      | 4,730      |       |      |            | 4,499   |       |            |  | 4,235  |        |  |  | 4,260  |      
|Total assets                                          |         |                                               | 206,865 |        |                                                          |  | 161,702 |            |  |      | 127,547    |       |      |            | 108,349 |       |            |  | 91,386 |        |  |  | 88,542 |      

Table 3


|                                                             |  |                      |      |  |      |  |      | 
|------------------------------------------------------------ |  | -------------------- | ---- |  | ---- |  | ---- | 
|                                                             |  | At and for the       |     
|                                                             |  | Financial Year Ended |     
|                                                             |  | March 31,            |     
|                                                             |  |                      |     
|                                                             |  | 2006                 |      |  | 2005 | 
|                                                             |  | IFRS                 |      |  | IFRS | 
|                                                             |  |                      |      |  |      | 
|                                                             |  | (in percentages)     |     
|Other Financial Data                                         |  |                      |      |  |      |  |      | 
|Return on average total assets(3)                            |  |                      | 0.9  |  |      |  | 0.9  | 
|Return on average stockholders equity(4)                    |  |                      | 27.3 |  |      |  | 23.5 | 
|Net interest margin(5)                                       |  |                      | 1.8  |  |      |  | 2.0  | 
|Cost/income ratio(6)                                         |  |                      | 54   |  |      |  | 61   | 
|Allowance for loan losses to total loans                     |  |                      | 0.4  |  |      |  | 0.4  | 
|Provisions for bad and doubtful debts to average total loans |  |                      | 0.1  |  |      |  | 0.1  | 
|Tier 1 capital ratio(7)                                      |  |                      | 7.5  |  |      |  | 7.9  | 
|Total capital ratio(7)                                       |  |                      | 11.4 |  |      |  | 10.9 | 
|Stockholders equity to assets(8)                            |  |                      | 3.3  |  |      |  | 3.3  | 
|Dividend payout ratio                                        |  |                      | 36   |  |      |  | 40   | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Translated solely for convenience into dollars at
    1.00 =
    U.S.$1.2793, the Noon Buying Rate on August 31, 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   
|(2) | See Item 8 Financial Information  Dividend
    Policy for details of dividends per unit of Ordinary Stock
    in dollars.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|(3) | Return on average total assets represents profit attributable to
    the ordinary stockholders as a percentage of average total
    assets. The calculation of the average balances for all years
    includes daily, weekly or monthly averages for certain reporting
    units. See Item 5 Operating & Financial Review
    and Prospects  Average Balance Sheet and Interest
    Rates. The Group considers these average balances to be
    representative of the operations of the Group.                                                                                                                                                                                         
|   
|(4) | Return on average stockholders equity represents profit
    attributable to the ordinary stockholders as a percentage of
    average stockholders funds, excluding minority interests.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   
|(5) | Net interest margin represents net interest income as a
    percentage of average interest earning assets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   
|(6) | The cost/income ratio is determined by dividing the total
    expenses before goodwill impairment of the Group by the total
    income of the Group including income from associated
    undertakings and joint ventures. The Groups management
    believes that cost/income ratio provides valuable information to
    readers of its financial statements because it enables the
    reader to focus more directly on the underlying performance of
    the Groups businesses and this measure also reflects an
    important way in which performance is monitored by the
    Groups management. However, while management believes this
    measure is useful in the evaluation of

9



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##### Table of Contents



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | the Groups performance, it should not be viewed as a
    replacement for, but rather as complementary to, the most
    directly comparable GAAP measure, which is the cost/income ratio
    determined by dividing the total expenses including goodwill
    impairment by the total income of the Group. In the two years
    ended March 31, 2006, there was no goodwill impairment. The
    cost/income ratio on a statutory basis would have been the same
    as presented in the table above.
|   
|(7) | The target standard risk-asset ratio set by the Basel Committee
    is 8%, of which the Tier 1 element must be at least 4%. The
    minimum risk-asset ratio is set by Financial Regulator and
    satisfies capital adequacy requirements of the European Union.
    The ratio given for 2005 is at April 1, 2005.                                                                                                                                                                                 
|   
|(8) | Stockholders equity excludes minority interests.                                                                                                                                                                                                                                                                                                                                                                                                                                                   



|                                                     |  |      |       |   |      |  |       |      |  |  |       |  |  |  |       |  
|---------------------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | ---- |  |  | ----- |  |  |  | ----- | -
|                                                     |  | 2005 |       |   | 2004 |  |       | 2003 |  |  | 2002  | 
|                                                     |  |      |       |   |      |  |       |      |  |  |       | 
|Previously reported net income                       |  |      | 814   |   |      |  | 892   |      |  |  | 767   |  |  |  | 667   |  
|Derivatives (ii)                                     |  |      | 18    |   |      |  | 9     |      |  |  | 70    |  |  |  | (16   | )
|Foreign Exchange differences on AFS securities (iii) |  |      | (18   | ) |      |  | 11    |      |  |  | 277   |  |  |  | 30    |  
|                                                     |  |      |       |   |      |  |       |      |  |  |       | 
|Restated net income                                  |  |      | 814   |   |      |  | 912   |      |  |  | 1,114 |  |  |  | 681   |  
|                                                     |  |      |       |   |      |  |       |      |  |  |       | 
|Previously reported shareholders equity              |  |      | 4,531 |   |      |  | 4,318 |      |  |  | 4,063 |  |  |  | 4,157 |  
|Leasing (i)                                          |  |      | 106   |   |      |  | 106   |      |  |  | 106   |  |  |  | 106   |  
|Derivatives (ii)                                     |  |      | 93    |   |      |  | 75    |      |  |  | 66    |  |  |  | (3    | )
|                                                     |  |      |       |   |      |  |       |      |  |  |       | 
|Restated stockholder funds                           |  |      | 4,730 |   |      |  | 4,499 |      |  |  | 4,235 |  |  |  | 4,260 |  
|                                                     |  |      |       |   |      |  |       |      |  |  |       | 





| |      |                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)  | Leasing: there was a one-off gain relating to certain lease
    structures arising from the falling corporation tax rates in
    Ireland in 1998 which was not recognized in that year under
    US GAAP. The effect of this is an increase in stockholders
    equity under US GAAP for the earliest year in the five year
    summary above.                                                                             
|
| | (ii) | As part of the transition process to IFRS the Bank discovered
    that the valuation of a small portfolio of derivatives did not
    take account of a specific legal clause resulting in an
    understatement of previously reported net income under
    US GAAP for the year 31, March 2005 of
    18m
    (20m pretax) and
    stockholders funds under US GAAP as at 31, March 2005
    of 93m
    (106m pretax).



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Five Year Financial Summary (above) has been restated
    for US GAAP financial data for these valuations resulting in an
    increase to net income of
    9m and
    70m for the
    years to 31 March 2004 and 31 March 2003 and an
    increase in stockholders funds of
    75m and
    66m for the same
    periods. In the year to 31 March 2002 the restatement
    resulted in a reduction to net income of
    16m and
    stockholders funds of
    3m.



| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (iii) | Under US GAAP foreign exchange differences on available for
    sale (AFS) securities were included in net income in
    previous years, rather than taken to reserves in accordance with
    EITF-96-15. Under IFRS the translation of foreign currency
    denominated AFS debt securities into the functional currency of
    the legal entity in which they are held is recognized directly
    in the income statement. Net income under US GAAP in the
    Five Year Financial summary has been reduced for the year to
    31 March 2005 by
    18m
    (21m pretax) and
    increased for the three years to 31 March 2004, 2003, and
    2002 by 11m
    (12m pretax),
    277m
    (315m pretax)
    and 30m
    (34m pretax).
    There is no change to stockholders equity.

10



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##### Table of Contents






RISK FACTORS




Risks concerning borrower credit quality and general economic
conditions are inherent in the Groups business.




Market risks associated with fluctuations in short- and
long-term interest rates, foreign exchange rates and equity
prices are inherent in the Groups business.




Operational risks are inherent in the Groups
business.




The Groups businesses are subject to substantial legal,
regulatory and governmental requirements and oversight.




11



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##### Table of Contents





Risks associated with strategic decisions regarding organic
growth, the competitive environment and potential acquisitions
are inherent in the Groups business.




The Groups insurance businesses are subject to inherent
risk regarding claims provisions.







Item 4     INFORMATION ON THE
COMPANY





GENERAL


 +353-1-6615933).













PRINCIPAL CAPITAL EXPENDITURES AND DIVESTITURES


Acquisitions




Guggenheim Advisors




12



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Iridian Asset Management LLC




Burdale Financial Holdings Limited





Divestitures




Bristol & West Branch Network




EuroConex Technologies Limited





Chase de Vere Financial Solutions plc and Moneyextra
Mortgages Limited


 





RECENT DEVELOPMENTS










13



---



##### Table of Contents










BUSINESS OVERVIEW












| |   |                                                                                                                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Bank of Ireland Asset Management which provides investment
    management services to institutions and pension funds in the
    U.K., the U.S., Australia, Canada and Japan;                           
|
| |  | Iridian Asset Management which provides investment management
    services to US institutional clients primarily in the
    foundation, endowment and corporate sectors;                               
|
| |  | Guggenheim Advisors which provides fund of hedge funds
    investment services to US institutional and high net worth
    clients;                                                                     
|
| |  | Paul Capital Top Tier Investments (a joint venture with
    Paul Capital Partners) which will provide private equity
    investment and advisory services to institutional investors
    worldwide; and
|
| |  | Corporate Banking which is engaged in international lending,
    with offices located in the U.K., Paris, Frankfurt and the U.S.                                                                       




STRATEGY






| |   |                                                                             
| | - | ----------------------------------------------------------------------------
| |  | maximising the return from our leading position in the Irish
    market;    
|
| |  | substantially reshaping and growing our business in the UK; and             
|
| |  | developing our portfolio of international, niche skill-based
    businesses.



14



---



##### Table of Contents



  









CORPORATE STRUCTURE




15



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##### Table of Contents





|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |   |  |  |          |   |  |  |         |  
|--------------------------------------------------------------- |  | ------------------------- | ------ | - | ---- |  | --------- | --------- |  | -- | --------- | - | ----- | ---------- | ------ | - | ------ |  | ----- | ------------ |  |  | ------ | - |  |  | -------- | - |  |  | ------- | -
|                                                                |  | Year ended March 31, 2006 |       
|                                                                |  |                           |       
|                                                                |  | Retail                    |        |   |     
|                                                                |  | Republic                  |        |   |      |  | Wholesale |           |  | UK |           |   | Asset |            |        |  
|                                                                |  | of                        |        |   | BOI  |  |           | Financial |  |    | Financial |   |       | Management |        |   | Group  |  |       |             
|                                                                |  | Ireland                   |        |   | Life |  |           | Services  |  |    | Services  |   |       | Services   |        |   | Centre |  |       | Eliminations |  |  | Total  |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|                                                                |  | m                        |        |   | m   |  |           | m        |  |    | m        |   |       | m         |        |   | m     |  |       | m           |  |  | m     |  
|Net interest income                                             |  |                           | 1,119  |   |      |  | 8         |           |  |    | 454       |   |       |            | 722    |   |        |  | 7     |              |  |  | (3     | ) |  |  |         |   |  |  | 2,307   |  
|Insurance net premium income                                    |  |                           |       |   |      |  | 1,264     |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 34     |   |  |  |         |   |  |  | 1,298   |  
|Other income                                                    |  |                           | 351    |   |      |  | 681       |           |  |    | 243       |   |       |            | 94     |   |        |  | 215   |              |  |  | (22    | ) |  |  |         |   |  |  | 1,562   |  
|Profit on disposal of business activities                       |  |                           |       |   |      |  |          |           |  |    |          |   |       |            | 176    |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | 176     |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income                                                    |  |                           | 1,470  |   |      |  | 1,953     |           |  |    | 697       |   |       |            | 992    |   |        |  | 222   |              |  |  | 9      |   |  |  |         |   |  |  | 5,343   |  
|Insurance claims                                                |  |                           |       |   |      |  | (1,655    | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  | (11    | ) |  |  |         |   |  |  | (1,666  | )
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income, net of insurance claims                           |  |                           | 1,470  |   |      |  | 298       |           |  |    | 697       |   |       |            | 992    |   |        |  | 222   |              |  |  | (2     | ) |  |  |         |   |  |  | 3,677   |  
|Operating expenses                                              |  |                           | (790   | ) |      |  | (92       | )         |  |    | (271      | ) |       |            | (448   | ) |        |  | (133  | )            |  |  | (120   | ) |  |  |         |   |  |  | (1,854  | )
|Depreciation and amortisation                                   |  |                           | (81    | ) |      |  | (3        | )         |  |    | (17       | ) |       |            | (33    | ) |        |  | (4    | )            |  |  | (28    | ) |  |  |         |   |  |  | (166    | )
|Impairment losses                                               |  |                           | (54    | ) |      |  |          |           |  |    | (23       | ) |       |            | (26    | ) |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (103    | )
|Income from associates and joint ventures                       |  |                           | 5      |   |      |  |          |           |  |    |          |   |       |            | 40     |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | 45      |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Profit before taxation                                          |  |                           | 550    |   |      |  | 203       |           |  |    | 386       |   |       |            | 525    |   |        |  | 85    |              |  |  | (150   | ) |  |  |         |   |  |  | 1,599   |  
|Sale of business activities                                     |  |                           |       |   |      |  |          |           |  |    |          |   |       |            | (176   | ) |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (176    | )
|Gross up of policyholder tax in the Life business               |  |                           |       |   |      |  | (69       | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (69     | )
|Hedge ineffectiveness on transition to IFRS                     |  |                           |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 7      |   |  |  |         |   |  |  | 7       |  
|Restructuring programme                                         |  |                           |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 32     |   |  |  |         |   |  |  | 32      |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Group profit before tax excluding the impact of above
    items |  |                           | 550    |   |      |  | 134       |           |  |    | 386       |   |       |            | 349    |   |        |  | 85    |              |  |  | (111   | ) |  |  |         |   |  |  | 1,393   |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total assets(1)                                                 |  |                           | 77,935 |   |      |  | 12,326    |           |  |    | 136,774   |   |       |            | 54,580 |   |        |  | 2,906 |              |  |  | 19,533 |   |  |  | (141,700 | ) |  |  | 162,354 |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  

16



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|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |   |  |  |          |   |  |  |         |  
|--------------------------------------------------------------- |  | ------------------------- | ------ | - | ---- |  | --------- | --------- |  | -- | --------- | - | ----- | ---------- | ------ | - | ------ |  | ----- | ------------ |  |  | ------ | - |  |  | -------- | - |  |  | ------- | -
|                                                                |  | Year ended March 31, 2006 |       
|                                                                |  |                           |       
|                                                                |  | Retail                    |        |   |     
|                                                                |  | Republic                  |        |   |      |  | Wholesale |           |  | UK |           |   | Asset |            |        |  
|                                                                |  | of                        |        |   | BOI  |  |           | Financial |  |    | Financial |   |       | Management |        |   | Group  |  |       |             
|                                                                |  | Ireland                   |        |   | Life |  |           | Services  |  |    | Services  |   |       | Services   |        |   | Centre |  |       | Eliminations |  |  | Total  |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|                                                                |  | m                        |        |   | m   |  |           | m        |  |    | m        |   |       | m         |        |   | m     |  |       | m           |  |  | m     |  
|Net interest income                                             |  |                           | 1,019  |   |      |  | 6         |           |  |    | 302       |   |       |            | 617    |   |        |  | 4     |              |  |  | (17    | ) |  |  |         |   |  |  | 1,931   |  
|Insurance net premium income                                    |  |                           |       |   |      |  | 1,755     |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 36     |   |  |  |         |   |  |  | 1,791   |  
|Other income                                                    |  |                           | 318    |   |      |  | 709       |           |  |    | 310       |   |       |            | 246    |   |        |  | 252   |              |  |  | (36    | ) |  |  |         |   |  |  | 1,799   |  
|Profit on disposal of business activities                       |  |                           |       |   |      |  |          |           |  |    |          |   |       |            | (20    | ) |        |  |      |              |  |  | 31     |   |  |  |         |   |  |  | 11      |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income                                                    |  |                           | 1,337  |   |      |  | 2,470     |           |  |    | 612       |   |       |            | 843    |   |        |  | 256   |              |  |  | 14     |   |  |  |         |   |  |  | 5,532   |  
|Insurance claims                                                |  |                           |       |   |      |  | (2,216    | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  | (6     | ) |  |  |         |   |  |  | (2,222  | )
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income, net of insurance claims                           |  |                           | 1,337  |   |      |  | 254       |           |  |    | 612       |   |       |            | 843    |   |        |  | 256   |              |  |  | 8      |   |  |  |         |   |  |  | 3,310   |  
|Operating expenses                                              |  |                           | (729   | ) |      |  | (89       | )         |  |    | (227      | ) |       |            | (504   | ) |        |  | (128  | )            |  |  | (197   | ) |  |  |         |   |  |  | (1,874  | )
|Depreciation and amortisation                                   |  |                           | (85    | ) |      |  | (4        | )         |  |    | (13       | ) |       |            | (47    | ) |        |  | (3    | )            |  |  | (25    | ) |  |  |         |   |  |  | (177    | )
|Impairment losses                                               |  |                           | (51    | ) |      |  |          |           |  |    | (38       | ) |       |            | 10     |   |        |  |      |              |  |  | 100    |   |  |  |         |   |  |  | 21      |  
|Income from associates and joint ventures                       |  |                           | (2     | ) |      |  |          |           |  |    |          |   |       |            | 32     |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | 30      |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Profit before taxation                                          |  |                           | 470    |   |      |  | 161       |           |  |    | 334       |   |       |            | 334    |   |        |  | 125   |              |  |  | (114   | ) |  |  |         |   |  |  | 1,310   |  
|Sale of business activities                                     |  |                           |       |   |      |  |          |           |  |    |          |   |       |            | 20     |   |        |  |      |              |  |  | (31    | ) |  |  |         |   |  |  | (11     | )
|Gross up of policyholder tax in the Life business               |  |                           |       |   |      |  | (26       | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (26     | )
|Hedge ineffectiveness on transition to IFRS                     |  |                           |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  |        |  
|Loan loss write back                                            |  |                           |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | (100   | ) |  |  |         |   |  |  | (100    | )
|Restructuring programme                                         |  |                           | 4      |   |      |  |          |           |  |    |          |   |       |            | 2      |   |        |  |      |              |  |  | 117    |   |  |  |         |   |  |  | 123     |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Group profit before tax excluding the impact of above
    items |  |                           | 474    |   |      |  | 135       |           |  |    | 334       |   |       |            | 356    |   |        |  | 125   |              |  |  | (128   | ) |  |  |         |   |  |  | 1,296   |  
|                                                                |  |                           |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total assets(1)                                                 |  |                           | 57,830 |   |      |  | 8,977     |           |  |    | 101,203   |   |       |            | 42,941 |   |        |  | 2,980 |              |  |  | 18,113 |   |  |  | (104,264 | ) |  |  | 127,780 |  






|    |                                                                                                                             
|--- | ----------------------------------------------------------------------------------------------------------------------------
|(1) | Total assets by division include intra-group items, which are
    required to be deducted in arriving at Group total assets.

Retail Republic of Ireland






17



---



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 










Bank of Ireland Life




Wholesale Financial Services






18



---



##### Table of Contents











UK Financial Services


















Asset Management Services







19



---



##### Table of Contents












Group Centre




Material Subsidiaries




|                                               |  |                                                  |  |               |         |  |           |  |              | 
|---------------------------------------------- |  | ------------------------------------------------ |  | ------------- | ------- |  | --------- |  | ------------ | 
|                                               |  |                                                  |  | Country of    |         |  | Statutory | 
|Name                                           |  | Principal activity                               |  | incorporation |         |  | year end  | 
|                                               |  |                                                  |  |               |         |  |           | 
|Bank of Ireland Asset Management Limited       |  | Asset management                                 |  |               | Ireland |  |           |  | March, 31    | 
|Bank of Ireland International Finance Limited* |  | International asset financing                    |  |               | Ireland |  |           |  | March, 31    | 
|Bank of Ireland Life Holdings plc*             |  | Life assurance and pensions                      |  |               | Ireland |  |           |  | December, 31 | 
|Bank of Ireland Mortgage Bank*                 |  | Mortgage lending and mortgage covered securities |  |               | Ireland |  |           |  | March, 31    | 
|Bristol & West plc                             |  | Mortgages, savings and investments               |  |               | England |  |           |  | March, 31    | 
|ICS Building Society*                          |  | Building society                                 |  |               | Ireland |  |           |  | December, 31 | 
|IBI Corporate Finance Limited*                 |  | Corporate finance                                |  |               | Ireland |  |           |  | March, 31    | 
|J & E Davy Holdings Limited                    |  | Stockbroking                                     |  |               | Ireland |  |           |  | December, 31 | 






|  |                                                                          
|- | -------------------------------------------------------------------------
|* | Direct subsidiary of The Governor and Company of the Bank of
    Ireland.



20



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DESCRIPTION OF PROPERTY

















COMPETITION




Ireland and Northern Ireland






21



---



##### Table of Contents





Britain






Inquiries






www.competition-commission.org.uk






| |   |                    
| | - | -------------------
| |  | Retail Banking; and
|
| |  | Business insurance.



22



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SUPERVISION AND REGULATION


IRELAND












23



---



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24



---



##### Table of Contents














UNITED KINGDOM








25



---



##### Table of Contents



















UNITED STATES




26



---



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THE IRISH ECONOMY


 







Item 4A     UNRESOLVED STAFF
COMMENTS







Item 5     OPERATING &
FINANCIAL REVIEW AND PROSPECTS


Overview




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##### Table of Contents





  


Non Core Items


|                                                                              |  |                |     |   |                |  |      |  
|----------------------------------------------------------------------------- |  | -------------- | --- | - | -------------- |  | ---- | -
|                                                                              |  | March 31, 2006 |     |   | March 31, 2005 | 
|                                                                              |  |                |     |   |                | 
|                                                                              |  |  million      |     |   |  million      | 
|a)   Profit on sale of the Bristol and West
    Branch Network during 2005/06 |  |                | 176 |   |                |  |     |  
|b)   Profit on sale of EuroConex and Chase de Vere                            |  |                |    |   |                |  | 11   |  
|c)  Gross up of policyholder tax in the Life business                         |  |                | 69  |   |                |  | 26   |  
|d)   Release of restructuring provisions                                      |  |                |    |   |                |  | 13   |  
|e)  Costs associated with restructuring programmes                            |  |                | (32 | ) |                |  | (136 | )
|f)   Hedge Ineffectiveness arising on transition
    to IFRS                  |  |                | (7  | ) |                |  |     |  
|g)   Impairment loss write back                                               |  |                |     |   |                |  | 100  |  
|                                                                              |  |                |     |   |                | 
|Total non-core items before tax                                               |  |                | 206 |   |                |  | 14   |  
|                                                                              |  |                |     |   |                | 
|Total non-core items after tax                                                |  |                | 141 |   |                |  | (9   | )
|                                                                              |  |                |     |   |                | 







CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS






|    |                                        
|--- | ---------------------------------------
|(a) | Impairment losses on loans and advances



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##### Table of Contents





|    |                          
|--- | -------------------------
|(b) | Fair value of derivatives





|    |                    
|--- | -------------------
|(c) | Retirement Benefits





|    |                          
|--- | -------------------------
|(d) | Life Assurance Operations







|    |         
|--- | --------
|(e) | Taxation





|    |         
|--- | --------
|(f) | Goodwill

 




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##### Table of Contents










LIQUIDITY AND CAPITAL RESOURCES














|                         |  |          |        |         |           |  |         |            |  |  |           |  |  |       |       |  |  |  |        | 
|------------------------ |  | -------- | ------ | ------- | --------- |  | ------- | ---------- |  |  | --------- |  |  | ----- | ----- |  |  |  | ------ | 
|                         |  |          |        | Between |           |  | Between |            |  |  |           | 
|                         |  | Within   |        |         | one and   |  |         | two and    |  |  | Over five |  |  |      
|                         |  | one year |        |         | two years |  |         | five years |  |  | years     |  |  | Total |      
|                         |  |          |        |         |           |  |         |            |  |  |           |  |  |       |      
|                         |  | m       |        |         | m        |  |         | m         |  |  | m        |  |  | m    |      
|Longterm debt  dated    |  |          |       |         |           |  |        |            |  |  | 806       |  |  |       | 2,807 |  |  |  | 3,613  | 
|Debt securities in issue |  |          | 22,596 |         |           |  | 4,689   |            |  |  | 6,523     |  |  |       | 3,006 |  |  |  | 36,814 | 
|Operating leases         |  |          | 48     |         |           |  | 46      |            |  |  | 115       |  |  |       | 542   |  |  |  | 751    | 
|Capital commitments      |  |          | 17     |         |           |  |        |            |  |  |          |  |  |       |      |  |  |  | 17     | 



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Capital Resources


   


|                 |  |             |               | 
|---------------- |  | ----------- | ------------- | 
|                 |  | Senior Debt |              
|                 |  |             |              
|Moodys           |  |             | Aa3 (stable)  | 
|Standard & Poors |  |             | A+ (positive) | 
|Fitch            |  |             | AA- (stable)  | 



Off Balance Sheet Arrangements


|                                                     |  |           |        |  |       |  |        | 
|---------------------------------------------------- |  | --------- | ------ |  | ----- |  | ------ | 
|                                                     |  | March 31, |       
|                                                     |  |           |       
|                                                     |  | 2006      |        |  | 2005  | 
|                                                     |  |           |        |  |       | 
|Contingent Liabilities                               |  | Total     |        |  | Total | 
|                                                     |  |           |        |  |       | 
|                                                     |  | m        |        |  | m    | 
|Acceptances and endorsements                         |  |           | 37     |  |       |  | 34     | 
|Guarantees and assets pledged as collateral security |  |           |        |  |       |  |        | 
| Assets pledged                                     |  |           |       |  |       |  |       | 
| Guarantees and irrevocable letters of credit       |  |           | 1,354  |  |       |  | 1,268  | 
|Other contingent liabilities                         |  |           | 675    |  |       |  | 643    | 
|                                                     |  |           |        |  |       | 
|                                                     |  |           | 2,066  |  |       |  | 1,945  | 
|Lending commitments                                  |  |           | 30,937 |  |       |  | 29,296 | 
|                                                     |  |           |        |  |       | 
|Total contingent liabilities and commitments         |  |           | 33,003 |  |       |  | 31,241 | 
|                                                     |  |           |        |  |       | 






ANALYSIS OF RESULTS OF OPERATIONS


Basis of Preparation and Presentation






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F-94.














| |   |                                                                               
| | - | ------------------------------------------------------------------------------
| |  | the change in statutory profit                                                
|
| |  | the impact on statutory profit of non-core items (i.e.
    underlying profits)
|
| |  | the impact of acquisitions and disposals and                                  
|
| |  | the impact of the move to IFRS.                                               



Statutory amounts:


Proforma amounts:


Non-core items:


Underlying amounts:


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Results of Operations  Group Analysis


Review of Group Performance


Group Income Statement


|                                                                   |  |                |        |   |                |  |        |                |  |  |        |  
|------------------------------------------------------------------ |  | -------------- | ------ | - | -------------- |  | ------ | -------------- |  |  | ------ | -
|                                                                   |  | Statutory      |        |   | Pro-forma      |  |        | Statutory      | 
|                                                                   |  | March 31, 2006 |        |   | March 31, 2005 |  |        | March 31, 2005 | 
|                                                                   |  |                |        |   |                |  |        |                | 
|                                                                   |  |  million      |        |   |  million      |  |        |  million      | 
|Net interest income                                                |  |                | 2,307  |   |                |  | 1,971  |                |  |  | 1,931  |  
|Other income (net of insurance claims)                             |  |                | 1,370  |   |                |  | 1,257  |                |  |  | 1,379  |  
|                                                                   |  |                |        |   |                |  |        |                | 
|Total operating income (net of insurance claims)                   |  |                | 3,677  |   |                |  | 3,228  |                |  |  | 3,310  |  
|Operating expenses                                                 |  |                | (2,020 | ) |                |  | (2,059 | )              |  |  | (2,051 | )
|Impairment losses on loans and advances                            |  |                | (103   | ) |                |  | 21     |                |  |  | 21     |  
|Share of associated undertakings and joint ventures
    (post tax) |  |                | 45     |   |                |  | 30     |                |  |  | 30     |  
|                                                                   |  |                |        |   |                |  |        |                | 
|Total profit before tax                                            |  |                | 1,599  |   |                |  | 1,220  |                |  |  | 1,310  |  
|Taxation                                                           |  |                | (303   | ) |                |  | (237   | )              |  |  | (256   | )
|Minority interest                                                  |  |                | 9      |   |                |  | 7      |                |  |  | 1      |  
|Dividends to preference stockholders                               |  |                | (13    | ) |                |  | (10    | )              |  |  | (8     | )
|                                                                   |  |                |        |   |                |  |        |                | 
|Profit attributable to ordinary stockholders                       |  |                | 1,292  |   |                |  | 980    |                |  |  | 1,047  |  
|                                                                   |  |                |        |   |                |  |        |                | 
|Basic EPS c per share                                              |  |                | 136.4c |   |                |  | 103.9c |                |  |  | 111.1c |  
|Underlying EPS c per share                                         |  |                | 118.5c |   |                |  | 102.3c |                |  |  |       |  

Income


Net Interest Income


|                                                                                       |                                                                  |                |       |     |                |  |       |                |   |  |       |     |  
|-------------------------------------------------------------------------------------- | ---------------------------------------------------------------- | -------------- | ----- | --- | -------------- |  | ----- | -------------- | - |  | ----- | --- | -
|                                                                                       |                                                                  | Statutory      |       |     | Pro-forma      |  |       | Statutory      |  
|                                                                                       |                                                                  | March 31, 2006 |       |     | March 31, 2005 |  |       | March 31, 2005 |  
|                                                                                       |                                                                  |                |       |     |                |  |       |                |  
|                                                                                       |                                                                  |  million      |       |     |  million      |  |       |  million      |  
|Net interest income                                                                    |                                                                  |                | 2,307 |     |                |  | 1,971 |                |   |  | 1,931 |    
|                                                                                       |    Acquisitions: Burdale &
    Guggenheim Advisors              |                |       | (15 | )              |  |       | (3             | ) |  |       | (3  | )
|                                                                                       |    Disposals: Chase de Vere &
    Bristol & West branch network |                |       | (18 | )              |  |       | (47            | ) |  |       | (47 | )
|                                                                                       |    IAS 32 and 39 impact                                         |                |       | (78 | )              |  |       |               |   |  |       | 0   |  
|                                                                                       |                                                                  |                |       |     |                |  |       |                |  
|Net interest income excluding impact of acquisitions and
    disposals & IAS 32 and 39 |                                                                  |                | 2,196 |     |                |  | 1,921 |                |   |  | 1,881 |    
|                                                                                       |                                                                  |                |       |     |                |  |       |                |  

  


Acquisitions:  


Disposals:  


IAS 32 and IAS 39 impact: 


   


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##### Table of Contents



 


Group Net Interest Margin


|                                               |  |                |       |   |                |  |      |                |  |  |      | 
|---------------------------------------------- |  | -------------- | ----- | - | -------------- |  | ---- | -------------- |  |  | ---- | 
|                                               |  | Statutory      |       |   | Pro-forma      |  |      | Statutory      | 
|                                               |  | March 31, 2006 |       |   | March 31, 2005 |  |      | March 31, 2005 | 
|                                               |  |                |       |   |                |  |      |                | 
|Average interest earning assets
    (billion) |  |                |       |   |                |  |      |                |  |  |      | 
|Domestic                                       |  |                | 84    |   |                |  | 64   |                |  |  | 59   | 
|Foreign                                        |  |                | 45    |   |                |  | 38   |                |  |  | 38   | 
|                                               |  |                |       |   |                |  |      |                | 
|Total                                          |  |                | 129   |   |                |  | 102  |                |  |  | 97   | 
|                                               |  |                |       |   |                |  |      |                | 
|Margin (%)                                     |  |                |       |   |                |  |      |                |  |  |      | 
|Domestic net interest margin                   |  |                | 1.87  |   |                |  | 2.09 |                |  |  | 2.21 | 
|Foreign net interest margin                    |  |                | 1.63  |   |                |  | 1.69 |                |  |  | 1.68 | 
|                                               |  |                |       |   |                |  |      |                | 
|Group net interest margin                      |  |                | 1.79  |   |                |  | 1.94 |                |  |  | 2.00 | 
|IAS 32 and 39 impact                           |  |                | (0.06 | ) |                |  |     |                |  |  |     | 
|                                               |  |                |       |   |                |  |      |                | 
|Adjusted net interest margin                   |  |                | 1.73  |   |                |  | 1.94 |                |  |  | 2.00 | 
|                                               |  |                |       |   |                |  |      |                | 





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Balance sheet structure where there was an increase in wholesale
    funding as loan growth continued to outpace deposit growth.
    Wholesale funding has increased from 35% to 46% of total funding
    over the year to March 31, 2006, with 6% of this increase
    due to the sale of Bristol & West branch network and its
    related deposit book.                                                                                                                                                                                
|
| |  | The lower returns being earned on the investment of credit
    balances (customer funds held in non interest-bearing current
    accounts) in the current low interest rate environment. The Bank
    of Ireland policy is to re-invest credit balances on average
    over a four year investment horizon. As interest rates remain
    low we are re-investing funds, that are maturing from a higher
    interest rate environment at lower rates. The low interest rate
    environment also has an impact on other liability margins.
|
| |  | Product mix where the impact of volumes in lower margin
    products, including mortgages and corporate banking loans,
    growing faster than higher margin products.                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | Competitive pressure impacting lending and deposit pricing in
    Ireland.                                                                                                                                                                                                                                                                                                                                                                                                                                                                



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Average Interest Earning Assets


|         |  |                              |     |  |           |  |     |           |  |  |    | 
|-------- |  | ---------------------------- | --- |  | --------- |  | --- | --------- |  |  | -- | 
|         |  | For the Financial Year Ended |    
|         |  | March 31,                    |    
|         |  |                              |    
|         |  | 2006                         |     |  | 2005      |  |     | 2005      | 
|         |  | Statutory                    |     |  | Pro-forma |  |     | Statutory | 
|         |  | IFRS                         |     |  | IFRS      |  |     | IFRS      | 
|         |  |                              |     |  |           |  |     |           | 
|         |  | (in  billions)              |    
|Group    |  |                              | 129 |  |           |  | 102 |           |  |  | 97 | 
|Domestic |  |                              | 84  |  |           |  | 64  |           |  |  | 59 | 
|Foreign  |  |                              | 45  |  |           |  | 38  |           |  |  | 38 | 



|                                 |                     |                   |      |      |      |  |      |      | 
|-------------------------------- | ------------------- | ----------------- | ---- | ---- | ---- |  | ---- | ---- | 
|                                 |                     | For the Financial |     
|                                 |                     | Year Ended        |     
|                                 |                     | March 31,         |     
|                                 |                     |                   |     
|                                 |                     | 2006              |      |      | 2005 | 
|                                 |                     |                   |      |      |      | 
|                                 |                     | (percentages)     |     
|Ireland                          |                     |                   |      |      |      |  |      |     
|European interbank offered rate: |                     |                   |      |      |      |  |      |     
|                                 | One month Euribor   |                   |      | 2.65 |      |  |      | 2.13 | 
|                                 | Three month Euribor |                   |      | 2.81 |      |  |      | 2.18 | 
|United Kingdom                   |                     |                   |      |      |      |  |      |     
|London interbank offered rate:   |                     |                   |      |      |      |  |      |     
|                                 | One month           |                   |      | 4.59 |      |  |      | 4.87 | 
|                                 | Three month         |                   |      | 4.61 |      |  |      | 4.98 | 
|United States                    |                     |                   |      |      |      |  |      |     
|Prime Rate                       |                     |                   | 7.75 |      |      |  | 5.75 |     

|                                                                                               |                                                                  |                |       |      |                |  |       |                |   |  |       |     |  
|---------------------------------------------------------------------------------------------- | ---------------------------------------------------------------- | -------------- | ----- | ---- | -------------- |  | ----- | -------------- | - |  | ----- | --- | -
|                                                                                               |                                                                  | Statutory      |       |      | Pro-forma      |  |       | Statutory      |  
|                                                                                               |                                                                  | March 31, 2006 |       |      | March 31, 2005 |  |       | March 31, 2005 |  
|                                                                                               |                                                                  |                |       |      |                |  |       |                |  
|                                                                                               |                                                                  |  million      |       |      |  million      |  |       |  million      |  
|Other Income                                                                                   |                                                                  |                | 1,370 |      |                |  | 1,257 |                |   |  | 1,379 |    
|                                                                                               |    Non Core items                                               |                |       | (238 | )              |  |       | (50            | ) |  |       | (50 | )
|                                                                                               |    Acquisitions: Burdale &
    Guggenheim Advisors              |                |       | (12  | )              |  |       | (1             | ) |  |       | (1  | )
|                                                                                               |    Disposals: Chase de Vere &
    Bristol & West branch network |                |       | (13  | )              |  |       | (80            | ) |  |       | (80 | )
|                                                                                               |    IAS 32 and IAS 39 impact                                     |                |       | 78   |                |  |       |               |   |  |       |    |  
|                                                                                               |                                                                  |                |       |      |                |  |       |                |  
|Underlying other income excluding impact of acquisitions and
    disposals & IAS 32 and IAS 39 |                                                                  |                | 1,185 |      |                |  | 1,126 |                |   |  | 1,248 |    
|                                                                                               |                                                                  |                |       |      |                |  |       |                |  

Other income   


Non Core Items:


Acquisitions:  


35



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Disposals:  


IAS 32 and IAS 39 impact: 


      


Operating Expenses


Total Operating Expenses


|                                                                                     |                                                                  |                |       |     |                |  |       |                |   |  |       |      |  
|------------------------------------------------------------------------------------ | ---------------------------------------------------------------- | -------------- | ----- | --- | -------------- |  | ----- | -------------- | - |  | ----- | ---- | -
|                                                                                     |                                                                  | Statutory      |       |     | Pro-forma      |  |       | Statutory      |  
|                                                                                     |                                                                  | March 31, 2006 |       |     | March 31, 2005 |  |       | March 31, 2005 |  
|                                                                                     |                                                                  |                |       |     |                |  |       |                |  
|                                                                                     |                                                                  |  million      |       |     |  million      |  |       |  million      |  
|Operating expenses                                                                   |                                                                  |                | 2,020 |     |                |  | 2,059 |                |   |  | 2,051 |     
|                                                                                     |    Non Core Items                                               |                |       | (32 | )              |  |       | (136           | ) |  |       | (136 | )
|                                                                                     |    Acquisitions: Burdale &
    Guggenheim Advisors              |                |       | (18 | )              |  |       | (2             | ) |  |       | (2   | )
|                                                                                     |    Disposals: Chase de Vere &
    Bristol & West branch network |                |       | (37 | )              |  |       | (131           | ) |  |       | (131 | )
|                                                                                     |                                                                  |                |       |     |                |  |       |                |  
|Underlying operating expenses excluding the impact of
    acquisitions and disposals |                                                                  |                | 1,933 |     |                |  | 1,790 |                |   |  | 1,782 |     
|                                                                                     |                                                                  |                |       |     |                |  |       |                |  

Operating Expenses   


Non-core items  


Acquisitions:  


Disposals:  


  






| |    |                                                                                                                                                                                                                                                                                                                                                                                                           
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | a) | Increased compliance costsassociated with the
    introduction of the Basel II and Sarbanes-Oxley (SOx)
    initiatives. The increase in expenditure relating to the
    introduction of these programmes is one percentage point of the
    increase in total Operating Expenses in the current year.
    Increased expenditure relating to these initiatives is expected
    to continue into next year.

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##### Table of Contents





| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b) | Increased pension costsarising from IAS 19
    added two percentage points to total Operating Expenses as a
    result of the lower discount rate applied to the value of
    pension liabilities. Under IFRS, the accounting deficit relating
    to the liabilities of the pension fund are carried on the
    balance sheet, and the costs associated with this deficit are
    charged through the income statement and equity.                         
|
| | c) | Investment costsThe Group continues to exploit
    growth opportunities both in our domestic markets and
    internationally. In Business Banking UK we expanded our
    Relationship Management Team. Wholesale Financial Services
    continued to expand the geographic scope of its operations with
    investment in the UK, Paris, Frankfurt and the US. These
    investment costs contributed two percentage points to cost
    growth for the year.





Strategic Transformation Programme  












Impairment of Loans and Advances







 


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##### Table of Contents



Asset Quality


|                                                 |  |                |       |  |                |  |       |                |  |  |       | 
|------------------------------------------------ |  | -------------- | ----- |  | -------------- |  | ----- | -------------- |  |  | ----- | 
|                                                 |  | Statutory      |       |  | Pro-forma      |  |       | Statutory      | 
|                                                 |  | March 31, 2006 |       |  | March 31, 2005 |  |       | March 31, 2005 | 
|                                                 |  |                |       |  |                |  |       |                | 
|Total average customer
    advances (bn)        |  |                | 93    |  |                |  | 74    |                |  |  | 74    | 
|Impaired
    loans (m)                          |  |                | 796   |  |                |  | 710   |                |  |  | 710   | 
|Impairment
    provision (m)                    |  |                | 359   |  |                |  | 319   |                |  |  | 319   | 
|Coverage ratio                                   |  |                | 45%   |  |                |  | 45%   |                |  |  | 45%   | 
|Impairment losses on loans and
    advances (m) |  |                | 103   |  |                |  | 79    |                |  |  | 79    | 
|Impairment losses on loans and advances  bps    |  |                | 11bps |  |                |  | 11bps |                |  |  | 11bps | 

Share of Associated Undertakings and Joint Ventures


 


Balance Sheet  Capital and Funding




 


 


Division


|                            |  |                                     |    |  |                    |  |    |           |  |  |     |  
|--------------------------- |  | ----------------------------------- | -- |  | ------------------ |  | -- | --------- |  |  | --- | -
|                            |  | % Growth March 2006 over March 2005 |   
|                            |  |                                     |   
|                            |  | Risk Weighted                       |    |  | Loans and advances |  |    |          
|                            |  | Assets                              |    |  | to customers       |  |    | Resources | 
|                            |  |                                     |    |  |                    |  |    |           | 
|Retail Ireland              |  |                                     | 22 |  |                    |  | 23 |           |  |  | 15  |  
|Wholesale (corporate loans) |  |                                     | 32 |  |                    |  | 35 |           |  |  | 15  |  
|UK Financial Services       |  |                                     | 31 |  |                    |  | 29 |           |  |  | (27 | )
|                            |  |                                     |    |  |                    |  |    |           | 
|Group                       |  |                                     | 28 |  |                    |  | 27 |           |  |  | 3   |  
|                            |  |                                     |    |  |                    |  |    |           | 

Capital




|                                        |  |                |      |  |                |  |      | 
|--------------------------------------- |  | -------------- | ---- |  | -------------- |  | ---- | 
|                                        |  | March 31, 2006 |      |  | March 31, 2005 | 
|                                        |  |                |      |  |                | 
|Tier 1 
     billion                  |  |                | 7.3  |  |                |  | 6.0  | 
|Tier 1 Ratio  %                        |  |                | 7.5  |  |                |  | 7.9  | 
|Total Capital Ratio  %                 |  |                | 11.4 |  |                |  | 10.9 | 
|Non-equity Tier 1 Ratio 
     billion |  |                | 2.6  |  |                |  | 1.8  | 
|Risk-weighted Assets 
     billion    |  |                | 98   |  |                |  | 76   | 



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##### Table of Contents



Funding




Balance Sheet Funding


|                  |  |                |     |  |                |  |     | 
|----------------- |  | -------------- | --- |  | -------------- |  | --- | 
|                  |  | March 31, 2006 |     |  | March 31, 2005 | 
|                  |  |                |     |  |                | 
|                  |  | %              |     |  | %              | 
|Deposits by banks |  |                | 23  |  |                |  | 18  | 
|CP/ CDs           |  |                | 12  |  |                |  | 10  | 
|Senior Debt/ ACS  |  |                | 11  |  |                |  | 7   | 
|Wholesale Funding |  |                | 46  |  |                |  | 35  | 
|Customer Deposits |  |                | 41  |  |                |  | 50  | 
|Capital/ Sub Debt |  |                | 8   |  |                |  | 7   | 
|Other             |  |                | 5   |  |                |  | 8   | 
|                  |  |                |     |  |                | 
|Total             |  |                | 100 |  |                |  | 100 | 
|                  |  |                |     |  |                | 





| |   |                                          
| | - | -----------------------------------------
| |  | A Canadian Commercial Paper Programme    
|
| |  | A French Certificate of Deposit Programme
|
| |  | A US Extendible Note Transaction.        






39



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##### Table of Contents



Taxes




|                                                                                                             |  |                              |       |   |           |  |       |  
|------------------------------------------------------------------------------------------------------------ |  | ---------------------------- | ----- | - | --------- |  | ----- | -
|                                                                                                             |  | For the Financial year ended |      
|                                                                                                             |  | March 31,                    |      
|                                                                                                             |  |                              |      
|                                                                                                             |  | Statutory                    |       |   | Statutory | 
|                                                                                                             |  | 2006                         |       |   | 2005      | 
|                                                                                                             |  |                              |       |   |           | 
|                                                                                                             |  | (in  millions,              |      
|                                                                                                             |  | except percentages)          |      
|Average statutory corporation tax rate                                                                       |  |                              | 12.5% |   |           |  | 12.5% |  
|                                                                                                             |  |                              |       |   |           | 
|Profit on ordinary activities before tax multiplied by the
    standard rate of
    Corporate tax in Ireland |  |                              | 200   |   |           |  | 165   |  
|Effects of:                                                                                                  |  |                              |       |   |           |  |       |  
|Levy on certain financial institutions                                                                       |  |                              | 20    |   |           |  | 26    |  
|Foreign earnings subject to different rates of tax                                                           |  |                              | 78    |   |           |  | 49    |  
|Life Assurance  different basis of taxation                                                                 |  |                              | 61    |   |           |  | 31    |  
|Tax exempted income and income at a reduced Irish tax rate                                                   |  |                              | (71   | ) |           |  | (18   | )
|Non-deductible expenses                                                                                      |  |                              | 12    |   |           |  | 1     |  
|Prior year adjustments                                                                                       |  |                              | 5     |   |           |  | 5     |  
|Share of associated undertakings and joint ventures                                                          |  |                              | (6    | ) |           |  | (5    | )
|Other adjustments for income tax purposes                                                                    |  |                              | 4     |   |           |  | 2     |  
|                                                                                                             |  |                              |       |   |           | 
|Income tax charge                                                                                            |  |                              | 303   |   |           |  | 256   |  
|                                                                                                             |  |                              |       |   |           | 
|Effective tax rates                                                                                          |  |                              | 18.9% |   |           |  | 19.5% |  

Financial year ended March 31, 2006 compared to
financial year ended March 31, 2005


 


Divisional Performance: Profit Before Tax


|                             |  |                |       |           |                |  |           |                |  |  |       |  
|---------------------------- |  | -------------- | ----- | --------- | -------------- |  | --------- | -------------- |  |  | ----- | -
|                             |  |                |       | Pro-forma |                |  | Statutory |               
|                             |  | March 31, 2006 |       |           | March 31, 2005 |  |           | March 31, 2005 | 
|                             |  |                |       |           |                |  |           |                | 
|                             |  |  million      |       |           |  million      |  |           |  million      | 
|Retail Republic of Ireland   |  |                | 550   |           |                |  | 461       |                |  |  | 470   |  
|Life                         |  |                | 203   |           |                |  | 107       |                |  |  | 161   |  
|Wholesale Financial Services |  |                | 386   |           |                |  | 325       |                |  |  | 334   |  
|UK Financial Services        |  |                | 525   |           |                |  | 310       |                |  |  | 334   |  
|Asset Management Services    |  |                | 85    |           |                |  | 125       |                |  |  | 125   |  
|Group Centre                 |  |                | (150  | )         |                |  | (108      | )              |  |  | (114  | )
|                             |  |                |       |           |                |  |           |                | 
|Profit before tax            |  |                | 1,599 |           |                |  | 1,220     |                |  |  | 1,310 |  
|                             |  |                |       |           |                |  |           |                | 

40



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##### Table of Contents



Divisional Performance: Underlying Profit Before Tax


|                             |  |                |       |           |                |  |       |                |  |  |       |  
|---------------------------- |  | -------------- | ----- | --------- | -------------- |  | ----- | -------------- |  |  | ----- | -
|                             |  |                |       | Pro-forma |                |  |      
|                             |  | March 31, 2006 |       |           | March 31, 2005 |  |       | March 31, 2005 | 
|                             |  |                |       |           |                |  |       |                | 
|                             |  |  million      |       |           |  million      |  |       |  million      | 
|Retail Republic of Ireland   |  |                | 550   |           |                |  | 465   |                |  |  | 474   |  
|Life                         |  |                | 134   |           |                |  | 81    |                |  |  | 135   |  
|Wholesale Financial Services |  |                | 386   |           |                |  | 325   |                |  |  | 334   |  
|UK Financial Services        |  |                | 349   |           |                |  | 332   |                |  |  | 356   |  
|Asset Management Services    |  |                | 85    |           |                |  | 125   |                |  |  | 125   |  
|Group Centre                 |  |                | (111  | )         |                |  | (122  | )              |  |  | (128  | )
|                             |  |                |       |           |                |  |       |                | 
|Underlying Profit before tax |  |                | 1,393 |           |                |  | 1,206 |                |  |  | 1,296 |  
|                             |  |                |       |           |                |  |       |                | 

Retail Republic of Ireland


  


Non core items: 


First time adoption of IAS 32, IAS 39 and
IFRS 4: 


  




Retail Republic of Ireland: Income Statement


|                                        |  |                |       |   |                |  |       |                |  |  |       |  
|--------------------------------------- |  | -------------- | ----- | - | -------------- |  | ----- | -------------- |  |  | ----- | -
|                                        |  | Statutory      |       |   | Pro-forma      |  |       | Statutory      | 
|                                        |  | March 31, 2006 |       |   | March 31, 2005 |  |       | March 31, 2005 | 
|                                        |  |                |       |   |                |  |       |                | 
|                                        |  |  million      |       |   |  million      |  |       |  million      | 
|Net interest income                     |  |                | 1,119 |   |                |  | 1,020 |                |  |  | 1,019 |  
|Other income*                           |  |                | 356   |   |                |  | 314   |                |  |  | 316   |  
|                                        |  |                |       |   |                |  |       |                | 
|Total operating income                  |  |                | 1,475 |   |                |  | 1,334 |                |  |  | 1,335 |  
|Total operating expenses                |  |                | (871  | ) |                |  | (818  | )              |  |  | (810  | )
|Impairment losses on loans and advances |  |                | (54   | ) |                |  | (51   | )              |  |  | (51   | )
|                                        |  |                |       |   |                |  |       |                | 
|Underlying profit before tax            |  |                | 550   |   |                |  | 465   |                |  |  | 474   |  
|Non Core items                          |  |                |      |   |                |  | (4    | )              |  |  | (4    | )
|                                        |  |                |       |   |                |  |       |                | 
|Profit before tax                       |  |                | 550   |   |                |  | 461   |                |  |  | 470   |  
|                                        |  |                |       |   |                |  |       |                | 






|  |                                                          
|- | ---------------------------------------------------------
|* | Includes share of associated undertakings/joint ventures.





| |   |                                                                                                            
| | - | -----------------------------------------------------------------------------------------------------------
| |  | clear strategic focus on service excellence delivered through
    our Changing for You Customer Programme

41



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##### Table of Contents





| |   |                                              
| | - | ---------------------------------------------
| |  | highly effective and responsible sales model 
|
| |  | leading multi-channel distribution capability







| |   |                                                                                                  
| | - | -------------------------------------------------------------------------------------------------
| |  | the affect of the low interest rate environment on liability
    margins                         
|
| |  | the higher rate of loan growth compared with resources leading
    to higher wholesale borrowings
|
| |  | changing product mix                                                                             
|
| |  | competition.                                                                                     








Bank of Ireland Life


IFRS Performance


Bank of Ireland Life: Income Statement


|                             |  |                |     |   |                |  |     |                |  |  |     |  
|---------------------------- |  | -------------- | --- | - | -------------- |  | --- | -------------- |  |  | --- | -
|                             |  | Statutory      |     |   | Pro-forma      |  |     | Statutory      | 
|                             |  | March 31, 2006 |     |   | March 31, 2005 |  |     | March 31, 2005 | 
|                             |  |                |     |   |                |  |     |                | 
|                             |  |  million      |     |   |  million      |  |     |  million      | 
|Income                       |  |                | 208 |   |                |  | 172 |                |  |  | 212 |  
|Costs                        |  |                | (95 | ) |                |  | (93 | )              |  |  | (93 | )
|                             |  |                |     |   |                |  |     |                | 
|Operating Profit             |  |                | 113 |   |                |  | 79  |                |  |  | 119 |  
|Investment variance          |  |                | 17  |   |                |  | 2   |                |  |  | 16  |  
|Discount rate change         |  |                | 4   |   |                |  |    |                |  |  |    |  
|                             |  |                |     |   |                |  |     |                | 
|Underlying profit before tax |  |                | 134 |   |                |  | 81  |                |  |  | 135 |  
|Non Core Items               |  |                | 69  |   |                |  | 26  |                |  |  | 26  |  
|                             |  |                |     |   |                |  |     |                | 
|Profit before tax            |  |                | 203 |   |                |  | 107 |                |  |  | 161 |  
|                             |  |                |     |   |                |  |     |                | 

  


Non core items:  


First time adoption of IAS 32, IAS 39 and
IFRS 4: 


42



---



##### Table of Contents





  


 




Embedded Value Performance




Bank of Ireland Life: Embedded Value Income Statement


|                                |                               |                |     |    |                |  |     |    | 
|------------------------------- | ----------------------------- | -------------- | --- | -- | -------------- |  | --- | -- | 
|                                |                               | March 31, 2006 |     |    | March 31, 2005 | 
|                                |                               |                |     |    |                | 
|                                |                               |  million      |     |    |  million      | 
|New business profits            |                               |                | 78  |    |                |  | 59  |   
|Existing business profits       |                               |                | 94  |    |                |  | 81  |   
|                                |                               |                |     |    |                | 
|                                |    Planned return on capital |                |     | 66 |                |  |     | 59 | 
|                                |    Experience variance       |                |     | 20 |                |  |     | 18 | 
|                                |    Assumption changes        |                |     | 8  |                |  |     | 4  | 
|                                |                               |                |     |    |                | 
|Investment income on free funds |                               |                | 5   |    |                |  | 5   |   
|Inter-company payments          |                               |                | (32 | )  |                |  | (26 | ) 
|                                |                               |                |     |    |                | 
|Operating Profit                |                               |                | 145 |    |                |  | 119 |   
|Investment variance             |                               |                | 51  |    |                |  | 16  |   
|Discount rate change            |                               |                | 8   |    |                |  |    |   
|                                |                               |                |     |    |                | 
|Profit before tax               |                               |                | 204 |    |                |  | 135 |   
|                                |                               |                |     |    |                | 



43



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##### Table of Contents



Wholesale Financial Services


     


Wholesale Financial Services: Income Statement


|                                        |  |                |      |   |                |  |      |                |  |  |      |  
|--------------------------------------- |  | -------------- | ---- | - | -------------- |  | ---- | -------------- |  |  | ---- | -
|                                        |  | Statutory      |      |   | Pro-forma      |  |      | Statutory      | 
|                                        |  | March 31, 2006 |      |   | March 31, 2005 |  |      | March 31, 2005 | 
|                                        |  |                |      |   |                |  |      |                | 
|                                        |  |  million      |      |   |  million      |  |      |  million      | 
|Net interest income                     |  |                | 454  |   |                |  | 325  |                |  |  | 302  |  
|Other income                            |  |                | 243  |   |                |  | 278  |                |  |  | 310  |  
|                                        |  |                |      |   |                |  |      |                | 
|Total operating income                  |  |                | 697  |   |                |  | 603  |                |  |  | 612  |  
|Total operating expenses                |  |                | (288 | ) |                |  | (240 | )              |  |  | (240 | )
|Impairment losses on loans and advances |  |                | (23  | ) |                |  | (38  | )              |  |  | (38  | )
|                                        |  |                |      |   |                |  |      |                | 
|Profit before tax                       |  |                | 386  |   |                |  | 325  |                |  |  | 334  |  
|                                        |  |                |      |   |                |  |      |                | 

 











 






44



---



##### Table of Contents







UK Financial Services (UKFS)


(local currency)


UK Financial Services: Income Statement


|                                                         |  |                |      |   |                |  |      |                |  |  |      |  
|-------------------------------------------------------- |  | -------------- | ---- | - | -------------- |  | ---- | -------------- |  |  | ---- | -
|                                                         |  | Statutory      |      |   | Pro-forma      |  |      | Statutory      | 
|                                                         |  | March 31, 2006 |      |   | March 31, 2005 |  |      | March 31, 2005 | 
|                                                         |  |                |      |   |                |  |      |                | 
|                                                         |  | £ million      |      |   | £ million      |  |      | £ million      | 
|Net interest income                                      |  |                | 493  |   |                |  | 429  |                |  |  | 421  |  
|Other income                                             |  |                | 63   |   |                |  | 135  |                |  |  | 159  |  
|                                                         |  |                |      |   |                |  |      |                | 
|Total operating income                                   |  |                | 556  |   |                |  | 564  |                |  |  | 580  |  
|Total operating expenses                                 |  |                | (329 | ) |                |  | (366 | )              |  |  | (366 | )
|Impairment losses on loans and advances                  |  |                | (17  | ) |                |  | 7    |                |  |  | 7    |  
|Share of associated undertakings & JV (profit after tax) |  |                | 28   |   |                |  | 22   |                |  |  | 22   |  
|                                                         |  |                |      |   |                |  |      |                | 
|Underlying profit before tax                             |  |                | 238  |   |                |  | 227  |                |  |  | 243  |  
|Non-core items                                           |  |                | 120  |   |                |  | (15  | )              |  |  | (15  | )
|                                                         |  |                |      |   |                |  |      |                | 
|Profit before tax                                        |  |                | 358  |   |                |  | 212  |                |  |  | 228  |  
|                                                         |  |                |      |   |                |  |      |                | 

The exchange rate applied by the Group in converting the
above Sterling amounts to Euro for the purposes of preparing the
consolidated financial statements was 0.6826 to 31, March
2006 and 0.6834 to 31, March 2005.






| |   |                                                                                                                                                                                                 
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Post Office Financial Services (POFS) was transferred to
    our UKFS Division.                                                                                                                 
|
| |  | First Rate Travel Services (FRTS), our personal foreign exchange
    travel service joint venture with the UK Post Office, was
    transferred from our Wholesale Division to our UKFS Division.





Non core items:


First time adoption of IAS 32, IAS 39 and IFRS 4:






45



---



##### Table of Contents

















Asset Management Services


Asset Management Services: Income Statement


|                         |  |                |      |   |                |  |      |                |  |  |      |  
|------------------------ |  | -------------- | ---- | - | -------------- |  | ---- | -------------- |  |  | ---- | -
|                         |  | Statutory      |      |   | Pro-forma      |  |      | Statutory      | 
|                         |  | March 31, 2006 |      |   | March 31, 2005 |  |      | March 31, 2005 | 
|                         |  |                |      |   |                |  |      |                | 
|                         |  |  million      |      |   |  million      |  |      |  million      | 
|Net interest income      |  |                | 7    |   |                |  | 4    |                |  |  | 4    |  
|Other income             |  |                | 215  |   |                |  | 252  |                |  |  | 252  |  
|                         |  |                |      |   |                |  |      |                | 
|Total operating income   |  |                | 222  |   |                |  | 256  |                |  |  | 256  |  
|Total operating expenses |  |                | (137 | ) |                |  | (131 | )              |  |  | (131 | )
|                         |  |                |      |   |                |  |      |                | 
|Profit before tax        |  |                | 85   |   |                |  | 125  |                |  |  | 125  |  
|                         |  |                |      |   |                |  |      |                | 

46



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##### Table of Contents






  










Group Centre


  


Non core items:     


First time adoption of IAS 32, IAS 39 and IFRS 4: 


  


47



---



##### Table of Contents



Income Statement March 31, 2006  Business
Segments


Year ended March 31, 2006


|                                                  |  |            |       |   |               |  |       |        |  |  |        |               |  |           |       |   |            |  |           |           |  |        |          |   |        |            |        |   |          |  |      |   |  |  |    |  |  |  |       |  
|------------------------------------------------- |  | ---------- | ----- | - | ------------- |  | ----- | ------ |  |  | ------ | ------------- |  | --------- | ----- | - | ---------- |  | --------- | --------- |  | ------ | -------- | - | ------ | ---------- | ------ | - | -------- |  | ---- | - |  |  | -- |  |  |  | ----- | -
|                                                  |  |            |       |   |               |  |       |        |  |  |        | Total income, |  |           |       |   | Impairment |  |           | Share of  |  |        |         
|                                                  |  | Net        |       |   | Insurance net |  |       |        |  |  |        |               |  | net of    |       |   |            |  | losses on |           |  | income |          |   | Profit |           
|                                                  |  | Interest   |       |   | premium       |  |       | Other  |  |  | Total  |               |  | Insurance |       |   | insurance  |  |           | Operating |  |        | loans &  |   |        | from       |        |   | before   | 
|                                                  |  | Income     |       |   | income        |  |       | Income |  |  | Income |               |  | Claims    |       |   | claims     |  |           | expenses  |  |        | advances |   |        | associates |        |   | taxation | 
|                                                  |  |            |       |   |               |  |       |        |  |  |        |               |  |           |       |   |            |  |           |           |  |        |          |   |        |            |        |   |          | 
|                                                  |  |  millions |      
|Retail Republic of Ireland                        |  |            | 1,119 |   |               |  |      |        |  |  | 351    |               |  |           | 1,470 |   |            |  |          |           |  |        | 1,470    |   |        |            | (871   | ) |          |  | (54  | ) |  |  | 5  |  |  |  | 550   |  
|BOI Life                                          |  |            | 8     |   |               |  | 1,264 |        |  |  | 612    |               |  |           | 1,884 |   |            |  | (1,655    | )         |  |        | 229      |   |        |            | (95    | ) |          |  |     |   |  |  |   |  |  |  | 134   |  
|Wholesale Financial                               |  |            |       |   |               |  |       |        |  |  |        |               |  |           |       |   |            |  |           |           |  |        |          |   |        |            |        |   |          |  |      |   |  |  |    |  |  |  |       |  
|Services                                          |  |            | 454   |   |               |  |      |        |  |  | 243    |               |  |           | 697   |   |            |  |          |           |  |        | 697      |   |        |            | (288   | ) |          |  | (23  | ) |  |  |   |  |  |  | 386   |  
|UK Financial Services                             |  |            | 722   |   |               |  |      |        |  |  | 94     |               |  |           | 816   |   |            |  |          |           |  |        | 816      |   |        |            | (481   | ) |          |  | (26  | ) |  |  | 40 |  |  |  | 349   |  
|Asset Management Services                         |  |            | 7     |   |               |  |      |        |  |  | 215    |               |  |           | 222   |   |            |  |          |           |  |        | 222      |   |        |            | (137   | ) |          |  |     |   |  |  |   |  |  |  | 85    |  
|Group Centre                                      |  |            | (3    | ) |               |  | 34    |        |  |  | (15    | )             |  |           | 16    |   |            |  | (11       | )         |  |        | 5        |   |        |            | (116   | ) |          |  |     |   |  |  |   |  |  |  | (111  | )
|                                                  |  |            |       |   |               |  |       |        |  |  |        |               |  |           |       |   |            |  |           |           |  |        |          |   |        |            |        |   |          | 
|Group  underlying                                |  |            | 2,307 |   |               |  | 1,298 |        |  |  | 1,500  |               |  |           | 5,105 |   |            |  | (1,666    | )         |  |        | 3,439    |   |        |            | (1,988 | ) |          |  | (103 | ) |  |  | 45 |  |  |  | 1,393 |  
|Sale of business activities                       |  |            |      |   |               |  |      |        |  |  | 176    |               |  |           | 176   |   |            |  |          |           |  |        | 176      |   |        |            |       |   |          |  |     |   |  |  |   |  |  |  | 176   |  
|Gross up of policyholder tax in the Life business |  |            |      |   |               |  |      |        |  |  | 69     |               |  |           | 69    |   |            |  |          |           |  |        | 69       |   |        |            |       |   |          |  |     |   |  |  |   |  |  |  | 69    |  
|Hedge ineffectiveness on transition to IFRS       |  |            |      |   |               |  |      |        |  |  | (7     | )             |  |           | (7    | ) |            |  |          |           |  |        | (7       | ) |        |            |       |   |          |  |     |   |  |  |   |  |  |  | (7    | )
|Restructuring programme                           |  |            |      |   |               |  |      |        |  |  |       |               |  |           |      |   |            |  |          |           |  |        |         |   |        |            | (32    | ) |          |  |     |   |  |  |   |  |  |  | (32   | )
|                                                  |  |            |       |   |               |  |       |        |  |  |        |               |  |           |       |   |            |  |           |           |  |        |          |   |        |            |        |   |          | 
|Group  statutory                                 |  |            | 2,307 |   |               |  | 1,298 |        |  |  | 1,738  |               |  |           | 5,343 |   |            |  | (1,666    | )         |  |        | 3,677    |   |        |            | (2,020 | ) |          |  | (103 | ) |  |  | 45 |  |  |  | 1,599 |  
|                                                  |  |            |       |   |               |  |       |        |  |  |        |               |  |           |       |   |            |  |           |           |  |        |          |   |        |            |        |   |          | 



Pro-forma Income Statement March 31, 2005 
Business Segments


Year ended March 31, 2005


|                                                  |  |            |       |              |               |  |       |        |  |  |               |        |  |           |      |   |              |            |       |              |          |  |          |   |  |            |      |   |          |  |     |   |  |  |    |   |  |  |       |  
|------------------------------------------------- |  | ---------- | ----- | ------------ | ------------- |  | ----- | ------ |  |  | ------------- | ------ |  | --------- | ---- | - | ------------ | ---------- | ----- | ------------ | -------- |  | -------- | - |  | ---------- | ---- | - | -------- |  | --- | - |  |  | -- | - |  |  | ----- | -
|                                                  |  |            |       | Other Income |               |  |       |        |  |  |               |        |  |           |      |   |              |            |       |              |         
|                                                  |  |            |       | including    |               |  |       |        |  |  | Total income, |        |  |           |      |   |              | Impairment |       |              | Share of |  |          |  
|                                                  |  | Net        |       |              | insurance net |  |       |        |  |  |               | net of |  |           |      |   | Depreciation |            |       | losses on    |          |  | income   |   |  | Profit     |     
|                                                  |  | Interest   |       |              | premium       |  |       | Total  |  |  | Insurance     |        |  | insurance |      |   | Operating    |            |       | and          |          |  | loans &  |   |  | from       |      |   | before   | 
|                                                  |  | Income     |       |              | income        |  |       | Income |  |  | Claims        |        |  | claims    |      |   | expenses     |            |       | amortisation |          |  | advances |   |  | associates |      |   | taxation | 
|                                                  |  |            |       |              |               |  |       |        |  |  |               |        |  |           |      |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 
|                                                  |  |  millions |      
|Retail Republic of Ireland                        |  |            | 1,020 |              |               |  | 316   |        |  |  | 1,336         |        |  |           |     |   |              |            | 1,336 |              |          |  | (737     | ) |  |            | (81  | ) |          |  | (51 | ) |  |  | (2 | ) |  |  | 465   |  
|BOI Life                                          |  |            | 6     |              |               |  | 914   |        |  |  | 920           |        |  |           | (746 | ) |              |            | 174   |              |          |  | (89      | ) |  |            | (4   | ) |          |  |    |   |  |  |   |   |  |  | 81    |  
|Wholesale Financial                               |  |            |       |              |               |  |       |        |  |  |               |        |  |           |      |   |              |            |       |              |          |  |          |   |  |            |      |   |          |  |     |   |  |  |    |   |  |  |       |  
|Services                                          |  |            | 325   |              |               |  | 278   |        |  |  | 603           |        |  |           |     |   |              |            | 603   |              |          |  | (227     | ) |  |            | (13  | ) |          |  | (38 | ) |  |  |   |   |  |  | 325   |  
|UK Financial Services                             |  |            | 628   |              |               |  | 198   |        |  |  | 826           |        |  |           |     |   |              |            | 826   |              |          |  | (489     | ) |  |            | (47  | ) |          |  | 10  |   |  |  | 32 |   |  |  | 332   |  
|Asset Management Services                         |  |            | 4     |              |               |  | 252   |        |  |  | 256           |        |  |           |     |   |              |            | 256   |              |          |  | (128     | ) |  |            | (3   | ) |          |  |    |   |  |  |   |   |  |  | 125   |  
|Group Centre                                      |  |            | (12   | )            |               |  | 1     |        |  |  | (11           | )      |  |           | (6   | ) |              |            | (17   | )            |          |  | (80      | ) |  |            | (25  | ) |          |  |    |   |  |  |   |   |  |  | (122  | )
|                                                  |  |            |       |              |               |  |       |        |  |  |               |        |  |           |      |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 
|Group  underlying                                |  |            | 1,971 |              |               |  | 1,959 |        |  |  | 3,930         |        |  |           | (752 | ) |              |            | 3,178 |              |          |  | (1,750   | ) |  |            | (173 | ) |          |  | (79 | ) |  |  | 30 |   |  |  | 1,206 |  
|Profit on sale of business activities             |  |            |      |              |               |  | 11    |        |  |  | 11            |        |  |           |     |   |              |            | 11    |              |          |  |         |   |  |            |     |   |          |  |    |   |  |  |   |   |  |  | 11    |  
|Gross up of policyholder tax in the Life business |  |            |      |              |               |  | 26    |        |  |  | 26            |        |  |           |     |   |              |            | 26    |              |          |  |         |   |  |            |     |   |          |  |    |   |  |  |   |   |  |  | 26    |  
|Impairment loss release                           |  |            |      |              |               |  |      |        |  |  |              |        |  |           |     |   |              |            |      |              |          |  |         |   |  |            |     |   |          |  | 100 |   |  |  |   |   |  |  | 100   |  
|Restructuring programme                           |  |            |      |              |               |  | 13    |        |  |  | 13            |        |  |           |     |   |              |            | 13    |              |          |  | (136     | ) |  |            |     |   |          |  |    |   |  |  |   |   |  |  | (123  | )
|                                                  |  |            |       |              |               |  |       |        |  |  |               |        |  |           |      |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 
|Group  total                                     |  |            | 1,971 |              |               |  | 2,009 |        |  |  | 3,980         |        |  |           | (752 | ) |              |            | 3,228 |              |          |  | (1,886   | ) |  |            | (173 | ) |          |  | 21  |   |  |  | 30 |   |  |  | 1,220 |  
|                                                  |  |            |       |              |               |  |       |        |  |  |               |        |  |           |      |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 



48



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##### Table of Contents



Statutory IFRS Income Statement March 31, 2005 
Business Segments


Year ended March 31, 2005


|                                                  |  |              |       |              |               |  |       |        |  |  |           |        |  |           |        |   |              |            |       |              |          |  |          |   |  |            |      |   |          |  |     |   |  |  |    |   |  |  |       |  
|------------------------------------------------- |  | ------------ | ----- | ------------ | ------------- |  | ----- | ------ |  |  | --------- | ------ |  | --------- | ------ | - | ------------ | ---------- | ----- | ------------ | -------- |  | -------- | - |  | ---------- | ---- | - | -------- |  | --- | - |  |  | -- | - |  |  | ----- | -
|                                                  |  |              |       | Other Income |               |  |       |        |  |  | Total     |        |  |           |        |   |              |            |       |              |          | 
|                                                  |  |              |       | including    |               |  |       |        |  |  | income,   |        |  |           |        |   |              | Impairment |       |              | Share of |  |          |  
|                                                  |  | Net          |       |              | insurance net |  |       |        |  |  |           | net of |  |           |        |   | Depreciation |            |       | losses on    |          |  | income   |   |  | Profit     |     
|                                                  |  | Interest     |       |              | premium       |  |       | Total  |  |  | Insurance |        |  | insurance |        |   | Operating    |            |       | and          |          |  | loans &  |   |  | from       |      |   | before   | 
|                                                  |  | Income       |       |              | income        |  |       | Income |  |  | Claims    |        |  | claims    |        |   | expenses     |            |       | amortisation |          |  | advances |   |  | associates |      |   | taxation | 
|                                                  |  |              |       |              |               |  |       |        |  |  |           |        |  |           |        |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 
|                                                  |  | ( millions) |      
|Retail Republic of Ireland                        |  |              | 1,019 |              |               |  | 318   |        |  |  | 1,337     |        |  |           |       |   |              |            | 1,337 |              |          |  | (729     | ) |  |            | (81  | ) |          |  | (51 | ) |  |  | (2 | ) |  |  | 474   |  
|BOI Life                                          |  |              | 6     |              |               |  | 2,438 |        |  |  | 2,444     |        |  |           | (2,216 | ) |              |            | 228   |              |          |  | (89      | ) |  |            | (4   | ) |          |  |    |   |  |  |   |   |  |  | 135   |  
|Wholesale Financial                               |  |              |       |              |               |  |       |        |  |  |           |        |  |           |        |   |              |            |       |              |          |  |          |   |  |            |      |   |          |  |     |   |  |  |    |   |  |  |       |  
|Services                                          |  |              | 302   |              |               |  | 310   |        |  |  | 612       |        |  |           |       |   |              |            | 612   |              |          |  | (227     | ) |  |            | (13  | ) |          |  | (38 | ) |  |  |   |   |  |  | 334   |  
|UK Financial Services                             |  |              | 617   |              |               |  | 233   |        |  |  | 850       |        |  |           |       |   |              |            | 850   |              |          |  | (489     | ) |  |            | (47  | ) |          |  | 10  |   |  |  | 32 |   |  |  | 356   |  
|Asset Management Services                         |  |              | 4     |              |               |  | 252   |        |  |  | 256       |        |  |           |       |   |              |            | 256   |              |          |  | (128     | ) |  |            | (3   | ) |          |  |    |   |  |  |   |   |  |  | 125   |  
|Group Centre                                      |  |              | (17   | )            |               |  |      |        |  |  | (17       | )      |  |           | (6     | ) |              |            | (23   | )            |          |  | (80      | ) |  |            | (25  | ) |          |  |    |   |  |  |   |   |  |  | (128  | )
|                                                  |  |              |       |              |               |  |       |        |  |  |           |        |  |           |        |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 
|Group  underlying                                |  |              | 1,931 |              |               |  | 3,551 |        |  |  | 5,482     |        |  |           | (2,222 | ) |              |            | 3,260 |              |          |  | (1,742   | ) |  |            | (173 | ) |          |  | (79 | ) |  |  | 30 |   |  |  | 1,296 |  
|Profit on sale of business activities             |  |              |      |              |               |  | 11    |        |  |  | 11        |        |  |           |       |   |              |            | 11    |              |          |  |         |   |  |            |     |   |          |  |    |   |  |  |   |   |  |  | 11    |  
|Gross up of policyholder tax in the Life business |  |              |      |              |               |  | 26    |        |  |  | 26        |        |  |           |       |   |              |            | 26    |              |          |  |         |   |  |            |     |   |          |  |    |   |  |  |   |   |  |  | 26    |  
|Impairment loss release                           |  |              |      |              |               |  |      |        |  |  |          |        |  |           |       |   |              |            |      |              |          |  |         |   |  |            |     |   |          |  | 100 |   |  |  |   |   |  |  | 100   |  
|Restructuring programme                           |  |              |      |              |               |  | 13    |        |  |  | 13        |        |  |           |       |   |              |            | 13    |              |          |  | (136     | ) |  |            |     |   |          |  |    |   |  |  |   |   |  |  | (123  | )
|                                                  |  |              |       |              |               |  |       |        |  |  |           |        |  |           |        |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 
|Group  statutory                                 |  |              | 1,931 |              |               |  | 3,601 |        |  |  | 5,532     |        |  |           | (2,222 | ) |              |            | 3,310 |              |          |  | (1,878   | ) |  |            | (173 | ) |          |  | 21  |   |  |  | 30 |   |  |  | 1,310 |  
|                                                  |  |              |       |              |               |  |       |        |  |  |           |        |  |           |        |   |              |            |       |              |          |  |          |   |  |            |      |   |          | 



Reconciliation of IFRS Statutory to Pro-forma IFRS
Consolidated Income Statement for Year Ended March 31,
2005


|                                                 |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |        |   |  |  |        |  
|------------------------------------------------ |  | ------------ | ------ | - | ------------------ |  | --- | ----------- |  |  | ---- | ---- |  | -------- | ------ | - |  |  | ------ | -
|                                                 |  | IFRS         |        |   | Effective Interest |  |     |             |  |  |      | IFRS | 
|                                                 |  | Statutory    |        |   | Rate               |  |     | Debt/Equity |  |  | Life |      |  | Proforma |       
|                                                 |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |       
|                                                 |  | ( millions) |       
|Net interest income                              |  |              | 1,931  |   |                    |  | 44  |             |  |  | (4   | )    |  |          |       |   |  |  | 1,971  |  
|Other income                                     |  |              | 3,601  |   |                    |  | (68 | )           |  |  |     |      |  |          | (1,524 | ) |  |  | 2,009  |  
|                                                 |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |       
|Total operating income                           |  |              | 5,532  |   |                    |  | (24 | )           |  |  | (4   | )    |  |          | (1,524 | ) |  |  | 3,980  |  
|Insurance claims                                 |  |              | (2,222 | ) |                    |  |    |             |  |  |     |      |  |          | 1,470  |   |  |  | (752   | )
|                                                 |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |       
|Total operating income net of Insurance Claims   |  |              | 3,310  |   |                    |  | (24 | )           |  |  | (4   | )    |  |          | (54    | ) |  |  | 3,228  |  
|Operating expenses                               |  |              | (2,051 | ) |                    |  | (8  | )           |  |  |     |      |  |          |       |   |  |  | (2,059 | )
|Impairment losses on loans & advances            |  |              | 21     |   |                    |  |    |             |  |  |     |      |  |          |       |   |  |  | 21     |  
|Income from associates and joint ventures        |  |              | 30     |   |                    |  |    |             |  |  |     |      |  |          |       |   |  |  | 30     |  
|                                                 |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |       
|Profit before taxation                           |  |              | 1,310  |   |                    |  | (32 | )           |  |  | (4   | )    |  |          | (54    | ) |  |  | 1,220  |  
|Non core items                                   |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |        |   |  |  |        |  
|Disposal of business activities                  |  |              | (11    | ) |                    |  |    |             |  |  |     |      |  |          |       |   |  |  | (11    | )
|Grossing up for policyholder tax in the          |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |        |   |  |  |        |  
|Life business                                    |  |              | (26    | ) |                    |  |    |             |  |  |     |      |  |          |       |   |  |  | (26    | )
|Restructuring programme                          |  |              | 123    |   |                    |  |    |             |  |  |     |      |  |          |       |   |  |  | 123    |  
|Release of impairment loss provision             |  |              | (100   | ) |                    |  |    |             |  |  |     |      |  |          |       |   |  |  | (100   | )
|                                                 |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |       
|Profit before tax  excluding
    non core items |  |              | 1,296  |   |                    |  | (32 | )           |  |  | (4   | )    |  |          | (54    | ) |  |  | 1,206  |  
|                                                 |  |              |        |   |                    |  |     |             |  |  |      |      |  |          |       

49



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##### Table of Contents





Effective Interest Rate (EIR).   


Life (IFRS 4/ IAS 39). 


Debt/ Equity (IAS 32). 


50



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##### Table of Contents






AVERAGE BALANCE SHEET AND INTEREST RATES




TABLE 1


|                                                      |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|----------------------------------------------------- |  | --------------- | ------- | - | -------- |  | ------- | --------------- |  |  | ------- |  |  | -------- | ------- | - | ---- |  | ----- |  |  |  | --- | 
|                                                      |  | 2006            |         |   | 2005     | 
|                                                      |  | IFRS            |         |   | IFRS     | 
|                                                      |  |                 |         |   |          | 
|                                                      |  | Average         |         |   |          |  | Average |                 |  | 
|                                                      |  | Balance         |         |   | Interest |  |         | Rate            |  |  | Balance |  |  | Interest |         |   | Rate | 
|                                                      |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      | 
|                                                      |  | (in  millions) |         |   | %        |  |         | (in  millions) |  |  | %       | 
|ASSETS                                                |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|Loans to banks                                        |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|Domestic offices                                      |  |                 | 9,268   |   |          |  | 226     |                 |  |  | 2.4     |  |  |          | 6,834   |   |      |  | 179   |  |  |  | 2.6 | 
|Foreign offices                                       |  |                 | 238     |   |          |  | 12      |                 |  |  | 5.0     |  |  |          | 987     |   |      |  | 36    |  |  |  | 3.6 | 
|Loans to customers(1)                                 |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|Domestic offices                                      |  |                 | 49,969  |   |          |  | 2,309   |                 |  |  | 4.6     |  |  |          | 38,671  |   |      |  | 1,784 |  |  |  | 4.6 | 
|Foreign offices                                       |  |                 | 43,106  |   |          |  | 2,264   |                 |  |  | 5.3     |  |  |          | 35,634  |   |      |  | 1,781 |  |  |  | 5.0 | 
|Central government and other eligible bills           |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|Domestic offices                                      |  |                 | 126     |   |          |  | 1       |                 |  |  | 0.8     |  |  |          | 7       |   |      |  |      |  |  |  |    | 
|Foreign offices                                       |  |                 |        |   |          |  |        |                 |  |  |        |  |  |          |        |   |      |  |      |  |  |  |    | 
|Debt Securities                                       |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|Domestic offices                                      |  |                 | 24,380  |   |          |  | 869     |                 |  |  | 3.6     |  |  |          | 13,307  |   |      |  | 426   |  |  |  | 3.2 | 
|Foreign offices                                       |  |                 | 1,518   |   |          |  | 64      |                 |  |  | 4.2     |  |  |          | 1,125   |   |      |  | 57    |  |  |  | 5.1 | 
|Other financial assets at fair value through P/L      |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|Domestic offices                                      |  |                 | 152     |   |          |  | 1       |                 |  |  | 0.7     |  |  |          |        |   |      |  |      |  |  |  |    | 
|Foreign offices                                       |  |                 | 232     |   |          |  | 10      |                 |  |  | 4.3     |  |  |          |        |   |      |  |      |  |  |  |    | 
|                                                      |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      | 
|Total interest-earning assets                         |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      |  |       |  |  |  |     | 
|Domestic offices                                      |  |                 | 83,895  |   |          |  | 3,406   |                 |  |  | 4.1     |  |  |          | 58,819  |   |      |  | 2,389 |  |  |  | 4.1 | 
|Foreign offices                                       |  |                 | 45,094  |   |          |  | 2,350   |                 |  |  | 5.2     |  |  |          | 37,746  |   |      |  | 1,874 |  |  |  | 5.0 | 
|Net swap interest                                     |  |                 |        |   |          |  | 34      |                 |  |  |        |  |  |          |        |   |      |  |      |  |  |  |    | 
|                                                      |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      | 
|                                                      |  |                 | 128,989 |   |          |  | 5,790   |                 |  |  | 4.5     |  |  |          | 96,565  |   |      |  | 4,263 |  |  |  | 4.4 | 
|Allowance for impairment losses                       |  |                 | (341    | ) |          |  |        |                 |  |  |         |  |  |          | (443    | ) |      |  |      |  |  |  |     | 
|Non interest earning assets(2)                        |  |                 | 18,615  |   |          |  |        |                 |  |  |         |  |  |          | 21,181  |   |      |  |      |  |  |  |     | 
|                                                      |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      | 
|Total Assets                                          |  |                 | 147,263 |   |          |  | 5,790   |                 |  |  | 3.9     |  |  |          | 117,303 |   |      |  | 4,263 |  |  |  | 3.6 | 
|                                                      |  |                 |         |   |          |  |         |                 |  |  |         |  |  |          |         |   |      | 
|Percentage of assets applicable to foreign activities |  |                 | 31.8%   |   |          |  |         |                 |  |  |         |  |  |          | 34.2%   |   |      |  |       |  |  |  |     | 

51



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AVERAGE BALANCE SHEET AND INTEREST RATES (Continued)


TABLE 2


|                                                      |  |                 |        |   |          |  |       |      |  |  |     | 
|----------------------------------------------------- |  | --------------- | ------ | - | -------- |  | ----- | ---- |  |  | --- | 
|                                                      |  | 2004            |       
|                                                      |  | IR GAAP         |       
|                                                      |  |                 |       
|                                                      |  | Average         |        |   |         
|                                                      |  | Balance         |        |   | Interest |  |       | Rate | 
|                                                      |  |                 |        |   |          |  |       |      | 
|                                                      |  | (in  millions) |        |   | %        | 
|ASSETS                                                |  |                 |        |   |          |  |       |      |  |  |     | 
|Loans to banks                                        |  |                 |        |   |          |  |       |      |  |  |     | 
|Domestic offices                                      |  |                 | 7,385  |   |          |  | 171   |      |  |  | 2.3 | 
|Foreign offices                                       |  |                 | 755    |   |          |  | 26    |      |  |  | 3.4 | 
|Loans to customers(1)                                 |  |                 |        |   |          |  |       |      |  |  |     | 
|Domestic offices                                      |  |                 | 28,987 |   |          |  | 1,394 |      |  |  | 4.8 | 
|Foreign offices                                       |  |                 | 29,533 |   |          |  | 1,494 |      |  |  | 5.0 | 
|Central government and other eligible bills           |  |                 |        |   |          |  |       |      |  |  |     | 
|Domestic offices                                      |  |                 | 9      |   |          |  |      |      |  |  |    | 
|Foreign offices                                       |  |                 |       |   |          |  |      |      |  |  |    | 
|Debt Securities                                       |  |                 |        |   |          |  |       |      |  |  |     | 
|Domestic offices                                      |  |                 | 8,942  |   |          |  | 268   |      |  |  | 3.0 | 
|Foreign offices                                       |  |                 | 1,453  |   |          |  | 63    |      |  |  | 4.3 | 
|Instalment credit                                     |  |                 |        |   |          |  |       |      |  |  |     | 
|Domestic offices                                      |  |                 | 502    |   |          |  | 35    |      |  |  | 7.0 | 
|Foreign offices                                       |  |                 | 869    |   |          |  | 61    |      |  |  | 7.0 | 
|Finance lease receivables                             |  |                 |        |   |          |  |       |      |  |  |     | 
|Domestic offices                                      |  |                 | 2,043  |   |          |  | 114   |      |  |  | 5.6 | 
|Foreign offices                                       |  |                 | 194    |   |          |  | 5     |      |  |  | 2.4 | 
|                                                      |  |                 |        |   |          |  |       |      | 
|Total interest-earning assets                         |  |                 |        |   |          |  |       |      |  |  |     | 
|Domestic offices                                      |  |                 | 47,868 |   |          |  | 1,982 |      |  |  | 4.1 | 
|Foreign offices                                       |  |                 | 32,804 |   |          |  | 1,649 |      |  |  | 5.0 | 
|                                                      |  |                 |        |   |          |  |       |      | 
|                                                      |  |                 | 80,672 |   |          |  | 3,631 |      |  |  | 4.5 | 
|Allowance for loan losses                             |  |                 | (496   | ) |          |  |       |      |  |  |     | 
|Non interest earning assets(2)                        |  |                 | 17,447 |   |          |  |       |      |  |  |     | 
|                                                      |  |                 |        |   |          |  |       |      | 
|Total Assets                                          |  |                 | 97,623 |   |          |  | 3,631 |      |  |  | 3.7 | 
|                                                      |  |                 |        |   |          |  |       |      | 
|Percentage of assets applicable to foreign activities |  |                 | 35.4%  |   |          |  |       |      |  |  |     | 

52



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##### Table of Contents



AVERAGE BALANCE SHEET AND INTEREST RATES (Continued)


TABLE 1


|                                                           |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|---------------------------------------------------------- |  | --------------- | ------- |  | -------- |  | ------- | --------------- |  |  | ------- |  |  | -------- | ------- |  | ---- |  | ----- |  |  |  | --- | 
|                                                           |  | 2006            |         |  | 2005     | 
|                                                           |  | IFRS            |         |  | IFRS     | 
|                                                           |  |                 |         |  |          | 
|                                                           |  | Average         |         |  |          |  | Average |                 |  | 
|                                                           |  | Balance         |         |  | Interest |  |         | Rate            |  |  | Balance |  |  | Interest |         |  | Rate | 
|                                                           |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      | 
|                                                           |  | (in  millions) |         |  | %        |  |         | (in  millions) |  |  | %       | 
|LIABILITIES AND STOCKHOLDERS EQUITY                       |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|Deposits by banks                                          |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|Domestic offices                                           |  |                 | 17,038  |  |          |  | 478     |                 |  |  | 2.8     |  |  |          | 18,882  |  |      |  | 399   |  |  |  | 2.1 | 
|Foreign offices                                            |  |                 | 2,041   |  |          |  | 74      |                 |  |  | 3.6     |  |  |          | 1,245   |  |      |  | 38    |  |  |  | 3.1 | 
|Customer accounts                                          |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|Domestic offices                                           |  |                 | 35,817  |  |          |  | 446     |                 |  |  | 1.2     |  |  |          | 24,136  |  |      |  | 219   |  |  |  | 0.9 | 
|Foreign offices                                            |  |                 | 20,579  |  |          |  | 1,100   |                 |  |  | 5.3     |  |  |          | 21,929  |  |      |  | 918   |  |  |  | 4.2 | 
|Debt securities in issue                                   |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|Domestic offices                                           |  |                 | 23,800  |  |          |  | 827     |                 |  |  | 3.5     |  |  |          | 13,977  |  |      |  | 354   |  |  |  | 2.5 | 
|Foreign offices                                            |  |                 | 6,393   |  |          |  | 301     |                 |  |  | 4.7     |  |  |          | 3,769   |  |      |  | 179   |  |  |  | 4.7 | 
|Subordinated liabilities                                   |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|Domestic offices                                           |  |                 | 2,955   |  |          |  | 120     |                 |  |  | 4.1     |  |  |          | 2,248   |  |      |  | 119   |  |  |  | 5.3 | 
|Foreign offices                                            |  |                 | 2,284   |  |          |  | 137     |                 |  |  | 6.0     |  |  |          | 1,442   |  |      |  | 106   |  |  |  | 7.4 | 
|                                                           |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      | 
|Total interest bearing liabilities                         |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|Domestic offices                                           |  |                 | 79,610  |  |          |  | 1,871   |                 |  |  | 2.4     |  |  |          | 59,243  |  |      |  | 1,091 |  |  |  | 1.8 | 
|Foreign offices                                            |  |                 | 31,297  |  |          |  | 1,612   |                 |  |  | 5.2     |  |  |          | 28,385  |  |      |  | 1,241 |  |  |  | 4.4 | 
|                                                           |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      | 
|                                                           |  |                 | 110,907 |  |          |  | 3,483   |                 |  |  | 3.1     |  |  |          | 87,628  |  |      |  | 2,332 |  |  |  | 2.7 | 
|Non interest bearing liabilities                           |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      |  |       |  |  |  |     | 
|Current accounts                                           |  |                 | 10,578  |  |          |  |        |                 |  |  |         |  |  |          | 8,886   |  |      |  |      |  |  |  |     | 
|Other non interest bearing liabilities(2)                  |  |                 | 20,987  |  |          |  |        |                 |  |  |         |  |  |          | 16,340  |  |      |  |      |  |  |  |     | 
|Stockholders equity                                       |  |                 | 4,791   |  |          |  |        |                 |  |  |         |  |  |          | 4,449   |  |      |  |      |  |  |  |     | 
|                                                           |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      | 
|Total liabilities and stockholders equity                 |  |                 | 147,263 |  |          |  | 3,483   |                 |  |  | 2.4     |  |  |          | 117,303 |  |      |  | 2,332 |  |  |  | 2.0 | 
|                                                           |  |                 |         |  |          |  |         |                 |  |  |         |  |  |          |         |  |      | 
|Percentage of liabilities applicable to foreign activities |  |                 | 31.8%   |  |          |  |         |                 |  |  |         |  |  |          | 34.2%   |  |      |  |       |  |  |  |     | 






|    |                                                                                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Loans to customers include non-accrual loans and loans
    classified as problem loans.                                                                                                  
|   
|(2) | The balance sheets of the life assurance companies have been
    consolidated and are reflected under Non interest earning
    assets and Other non interest bearing
    liabilities.

53



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##### Table of Contents



AVERAGE BALANCE SHEET AND INTEREST RATES (Continued)


TABLE 2


|                                                           |  |                 |        |  |          |  |       |      |  |  |     | 
|---------------------------------------------------------- |  | --------------- | ------ |  | -------- |  | ----- | ---- |  |  | --- | 
|                                                           |  | 2004            |       
|                                                           |  | IR GAAP         |       
|                                                           |  |                 |       
|                                                           |  | Average         |        |  |         
|                                                           |  | Balance         |        |  | Interest |  |       | Rate | 
|                                                           |  |                 |        |  |          |  |       |      | 
|                                                           |  | (in  millions) |        |  | %        | 
|LIABILITIES AND STOCKHOLDERS EQUITY                       |  |                 |        |  |          |  |       |      |  |  |     | 
|Deposits by banks                                          |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 13,946 |  |          |  | 388   |      |  |  | 2.8 | 
|Foreign offices                                            |  |                 | 1,028  |  |          |  | 34    |      |  |  | 3.3 | 
|Customer accounts                                          |  |                 |        |  |          |  |       |      |  |  |     | 
|Demand deposits                                            |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 10,936 |  |          |  | 124   |      |  |  | 1.1 | 
|Foreign offices                                            |  |                 | 8,449  |  |          |  | 240   |      |  |  | 2.8 | 
|Term deposits                                              |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 9,640  |  |          |  | 73    |      |  |  | 0.8 | 
|Foreign offices                                            |  |                 | 9,893  |  |          |  | 504   |      |  |  | 5.1 | 
|Other deposits                                             |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 550    |  |          |  | 39    |      |  |  | 7.1 | 
|Foreign offices                                            |  |                 | 14     |  |          |  | 1     |      |  |  | 5.0 | 
|Interest bearing current accounts                          |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 850    |  |          |  | 8     |      |  |  | 1.0 | 
|Foreign offices                                            |  |                 | 2,312  |  |          |  | 61    |      |  |  | 2.6 | 
|Debt securities in issue                                   |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 8,049  |  |          |  | 131   |      |  |  | 1.6 | 
|Foreign offices                                            |  |                 | 3,037  |  |          |  | 107   |      |  |  | 3.5 | 
|Subordinated liabilities                                   |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 1,566  |  |          |  | 75    |      |  |  | 4.8 | 
|Foreign offices                                            |  |                 | 1,382  |  |          |  | 102   |      |  |  | 7.4 | 
|                                                           |  |                 |        |  |          |  |       |      | 
|Total interest bearing liabilities                         |  |                 |        |  |          |  |       |      |  |  |     | 
|Domestic offices                                           |  |                 | 45,537 |  |          |  | 838   |      |  |  | 1.8 | 
|Foreign offices                                            |  |                 | 26,115 |  |          |  | 1,049 |      |  |  | 4.0 | 
|                                                           |  |                 |        |  |          |  |       |      | 
|                                                           |  |                 | 71,652 |  |          |  | 1,887 |      |  |  | 2.6 | 
|Non interest bearing liabilities                           |  |                 |        |  |          |  |       |      |  |  |     | 
|Current accounts                                           |  |                 | 7,426  |  |          |  |       |      |  |  |     | 
|Other non interest bearing liabilities(2)                  |  |                 | 14,153 |  |          |  |       |      |  |  |     | 
|Stockholders equity including non equity interests         |  |                 | 4,392  |  |          |  |       |      |  |  |     | 
|                                                           |  |                 |        |  |          |  |       |      | 
|Total liabilities and stockholders equity                 |  |                 | 97,623 |  |          |  | 1,887 |      |  |  | 1.9 | 
|                                                           |  |                 |        |  |          |  |       |      | 
|Percentage of liabilities applicable to foreign activities |  |                 | 35.4%  |  |          |  |       |      |  |  |     | 

54



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##### Table of Contents



Change in Net Interest Income  Volume and Rate
Analysis




|                                                  |  |                            |       |   |         |  |      |        |  |  |       |  
|------------------------------------------------- |  | -------------------------- | ----- | - | ------- |  | ---- | ------ |  |  | ----- | -
|                                                  |  | 2006 over 2005 IFRS        |      
|                                                  |  |                            |      
|                                                  |  | Increase/(Decrease) due to |      
|                                                  |  | change in                  |      
|                                                  |  |                            |      
|                                                  |  | Average                    |       |   | Average |  |      | Net    | 
|                                                  |  | Volume                     |       |   | Rate    |  |      | Change | 
|                                                  |  |                            |       |   |         |  |      |        | 
|                                                  |  | (in  millions)            |      
|INTEREST EARNING ASSETS                           |  |                            |       |   |         |  |      |        |  |  |       |  
|Loans to Banks                                    |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | 60    |   |         |  | (13  | )      |  |  | 47    |  
|Foreign offices                                   |  |                            | (34   | ) |         |  | 10   |        |  |  | (24   | )
|Loans to customers                                |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | 522   |   |         |  | 3    |        |  |  | 525   |  
|Foreign offices                                   |  |                            | 389   |   |         |  | 94   |        |  |  | 483   |  
|Central government and other eligible bills       |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            |      |   |         |  | 1    |        |  |  | 1     |  
|Foreign offices                                   |  |                            |      |   |         |  |     |        |  |  |      |  
|Debt securities                                   |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | 390   |   |         |  | 53   |        |  |  | 443   |  
|Foreign offices                                   |  |                            | 18    |   |         |  | (11  | )      |  |  | 7     |  
|Other financial assets at fair value through P/ L |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | 1     |   |         |  |     |        |  |  | 1     |  
|Foreign offices                                   |  |                            | 10    |   |         |  |     |        |  |  | 10    |  
|                                                  |  |                            |       |   |         |  |      |        | 
|Total interest income                             |  |                            | 1,356 |   |         |  | 137  |        |  |  | 1,493 |  
|                                                  |  |                            |       |   |         |  |      |        | 
|                                                 
|INTEREST BEARING LIABILITIES                      |  |                            |       |   |         |  |      |        |  |  |       |  
|Deposits by Banks                                 |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | (42   | ) |         |  | 121  |        |  |  | 79    |  
|Foreign offices                                   |  |                            | 28    |   |         |  | 8    |        |  |  | 36    |  
|Customer accounts                                 |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | 128   |   |         |  | 99   |        |  |  | 227   |  
|Foreign offices                                   |  |                            | (59   | ) |         |  | 241  |        |  |  | 182   |  
|Debt securities in issue                          |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | 309   |   |         |  | 164  |        |  |  | 473   |  
|Foreign offices                                   |  |                            | 124   |   |         |  | (2   | )      |  |  | 122   |  
|Subordinated liabilities                          |  |                            |       |   |         |  |      |        |  |  |       |  
|Domestic offices                                  |  |                            | 32    |   |         |  | (31  | )      |  |  | 1     |  
|Foreign offices                                   |  |                            | 53    |   |         |  | (22  | )      |  |  | 31    |  
|                                                  |  |                            |       |   |         |  |      |        | 
|Total interest bearing expense                    |  |                            | 573   |   |         |  | 578  |        |  |  | 1,151 |  
|                                                  |  |                            |       |   |         |  |      |        | 
|Net interest income                               |  |                            | 783   |   |         |  | (441 | )      |  |  | 342   |  
|                                                  |  |                            |       |   |         |  |      |        | 
|Net swap interest                                 |  |                            |       |   |         |  |      |        |  |  | 34    |  
|                                                  |  |                            |       |   |         |  |      |        | 
|Total change in net interest income               |  |                            |       |   |         |  |      |        |  |  | 376   |  
|                                                  |  |                            |       |   |         |  |      |        | 

55



---



##### Table of Contents






DESCRIPTION OF ASSETS AND LIABILITIES




Assets


Loan Portfolio














56



---



##### Table of Contents



Total loans to customers by origin




Table 1


|                            |  |                 |         |   |      |  |        |  
|--------------------------- |  | --------------- | ------- | - | ---- |  | ------ | -
|                            |  | At March 31,    |        
|                            |  |                 |        
|                            |  | 2006            |         |   | 2005 | 
|                            |  | IFRS            |         |   | IFRS | 
|                            |  |                 |         |   |      | 
|                            |  | (in  millions) |        
|Ireland                     |  |                 |         |   |      |  |        |  
|Agriculture                 |  |                 | 1,160   |   |      |  | 1,145  |  
|Energy                      |  |                 | 485     |   |      |  | 476    |  
|Manufacturing               |  |                 | 4,850   |   |      |  | 4,245  |  
|Construction and property   |  |                 | 10,726  |   |      |  | 8,065  |  
|Distribution                |  |                 | 2,986   |   |      |  | 2,239  |  
|Transport                   |  |                 | 1,168   |   |      |  | 982    |  
|Financial                   |  |                 | 1,676   |   |      |  | 1,399  |  
|Business and other services |  |                 | 6,112   |   |      |  | 4,165  |  
|Personal                    |  |                 |         |   |      |  |        |  
| residential mortgages     |  |                 | 19,827  |   |      |  | 15,686 |  
| other lending             |  |                 | 5,212   |   |      |  | 4,538  |  
|                            |  |                 |         |   |      | 
|                            |  |                 | 54,202  |   |      |  | 42,940 |  
|                            |  |                 |         |   |      | 
|United Kingdom              |  |                 |         |   |      |  |        |  
|Agriculture                 |  |                 | 69      |   |      |  | 67     |  
|Energy                      |  |                 | 48      |   |      |  | 61     |  
|Manufacturing               |  |                 | 842     |   |      |  | 657    |  
|Construction and property   |  |                 | 7,057   |   |      |  | 4,242  |  
|Distribution                |  |                 | 289     |   |      |  | 186    |  
|Transport                   |  |                 | 292     |   |      |  | 293    |  
|Financial                   |  |                 | 430     |   |      |  | 237    |  
|Business and other services |  |                 | 2,199   |   |      |  | 1,746  |  
|Commercial mortgages        |  |                 | 2,595   |   |      |  | 2,228  |  
|Personal                    |  |                 |         |   |      |  |        |  
| residential mortgages     |  |                 | 31,171  |   |      |  | 25,653 |  
| other lending             |  |                 | 2,411   |   |      |  | 1,845  |  
|                            |  |                 |         |   |      | 
|                            |  |                 | 47,403  |   |      |  | 37,215 |  
|                            |  |                 |         |   |      | 
|Group total loan portfolio  |  |                 | 101,605 |   |      |  | 80,155 |  
|Allowance for loan losses   |  |                 | (359    | ) |      |  | (319   | )
|                            |  |                 |         |   |      | 
|Total                       |  |                 | 101,246 |   |      |  | 79,836 |  
|                            |  |                 |         |   |      | 

57



---



##### Table of Contents



Total loans to customers by origin (Continued)


Table 2


|                            |  |                 |        |   |         |  |        |         |  |  |        |  
|--------------------------- |  | --------------- | ------ | - | ------- |  | ------ | ------- |  |  | ------ | -
|                            |  | At March 31,    |       
|                            |  |                 |       
|                            |  | 2004            |        |   | 2003    |  |        | 2002    | 
|                            |  | IR GAAP         |        |   | IR GAAP |  |        | IR GAAP | 
|                            |  |                 |        |   |         |  |        |         | 
|                            |  | (in  millions) |       
|Ireland                     |  |                 |        |   |         |  |        |         |  |  |        |  
|Agriculture                 |  |                 | 1,134  |   |         |  | 1,142  |         |  |  | 1,114  |  
|Energy                      |  |                 | 485    |   |         |  | 650    |         |  |  | 696    |  
|Manufacturing               |  |                 | 3,579  |   |         |  | 3,866  |         |  |  | 3,908  |  
|Construction and property   |  |                 | 6,111  |   |         |  | 4,666  |         |  |  | 3,638  |  
|Distribution                |  |                 | 1,575  |   |         |  | 1,391  |         |  |  | 1,353  |  
|Transport                   |  |                 | 954    |   |         |  | 486    |         |  |  | 899    |  
|Financial                   |  |                 | 1,311  |   |         |  | 817    |         |  |  | 1,960  |  
|Business and other services |  |                 | 3,147  |   |         |  | 2,865  |         |  |  | 2,478  |  
|Personal                    |  |                 |        |   |         |  |        |         |  |  |        |  
| residential mortgages     |  |                 | 12,360 |   |         |  | 10,005 |         |  |  | 7,944  |  
| other lending             |  |                 | 3,614  |   |         |  | 3,025  |         |  |  | 2,718  |  
|                            |  |                 |        |   |         |  |        |         | 
|                            |  |                 | 34,270 |   |         |  | 28,913 |         |  |  | 26,708 |  
|                            |  |                 |        |   |         |  |        |         | 
|United Kingdom              |  |                 |        |   |         |  |        |         |  |  |        |  
|Agriculture                 |  |                 | 69     |   |         |  | 58     |         |  |  | 55     |  
|Energy                      |  |                 | 63     |   |         |  | 158    |         |  |  | 142    |  
|Manufacturing               |  |                 | 1,275  |   |         |  | 721    |         |  |  | 593    |  
|Construction and property   |  |                 | 2,572  |   |         |  | 1,984  |         |  |  | 2,091  |  
|Distribution                |  |                 | 203    |   |         |  | 224    |         |  |  | 226    |  
|Transport                   |  |                 | 337    |   |         |  | 249    |         |  |  | 63     |  
|Financial                   |  |                 | 173    |   |         |  | 96     |         |  |  | 153    |  
|Business and other services |  |                 | 1,375  |   |         |  | 1,250  |         |  |  | 1,094  |  
|Commercial mortgages        |  |                 | 2,130  |   |         |  | 1,855  |         |  |  | 1,989  |  
|Personal                    |  |                 |        |   |         |  |        |         |  |  |        |  
| residential mortgages     |  |                 | 24,073 |   |         |  | 20,863 |         |  |  | 22,933 |  
| other lending             |  |                 | 1,472  |   |         |  | 995    |         |  |  | 1,008  |  
|                            |  |                 |        |   |         |  |        |         | 
|                            |  |                 | 33,742 |   |         |  | 28,453 |         |  |  | 30,347 |  
|                            |  |                 |        |   |         |  |        |         | 
|United States               |  |                 |        |   |         |  |        |         |  |  |        |  
|Commercial loans            |  |                 |       |   |         |  | 1      |         |  |  | 22     |  
|                            |  |                 |        |   |         |  |        |         | 
|                            |  |                 |       |   |         |  | 1      |         |  |  | 22     |  
|                            |  |                 |        |   |         |  |        |         | 
|Group total loan portfolio  |  |                 | 68,012 |   |         |  | 57,367 |         |  |  | 57,077 |  
|Allowance for loan losses   |  |                 | (472   | ) |         |  | (480   | )       |  |  | (500   | )
|                            |  |                 |        |   |         |  |        |         | 
|Total                       |  |                 | 67,540 |   |         |  | 56,887 |         |  |  | 56,577 |  
|                            |  |                 |        |   |         |  |        |         | 

58



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##### Table of Contents



Total loans to customers by origin (%)




Table 1


|                            |  |              |       |  |      |  |       | 
|--------------------------- |  | ------------ | ----- |  | ---- |  | ----- | 
|                            |  | At March 31, |      
|                            |  |              |      
|                            |  | 2006         |       |  | 2005 | 
|                            |  | IFRS         |       |  | IFRS | 
|                            |  |              |       |  |      | 
|                            |  | %            |       |  | %    | 
|Ireland                     |  |              |       |  |      |  |       | 
|Agriculture                 |  |              | 1.1   |  |      |  | 1.4   | 
|Energy                      |  |              | 0.5   |  |      |  | 0.6   | 
|Manufacturing               |  |              | 4.8   |  |      |  | 5.3   | 
|Construction and property   |  |              | 10.6  |  |      |  | 10.1  | 
|Distribution                |  |              | 2.9   |  |      |  | 2.8   | 
|Transport                   |  |              | 1.1   |  |      |  | 1.2   | 
|Financial                   |  |              | 1.7   |  |      |  | 1.7   | 
|Business and other services |  |              | 6.0   |  |      |  | 5.2   | 
|Personal                    |  |              |       |  |      |  |       | 
| residential mortgages     |  |              | 19.5  |  |      |  | 19.6  | 
| other lending             |  |              | 5.1   |  |      |  | 5.7   | 
|                            |  |              |       |  |      | 
|                            |  |              | 53.3  |  |      |  | 53.6  | 
|                            |  |              |       |  |      | 
|United Kingdom              |  |              |       |  |      |  |       | 
|Agriculture                 |  |              | 0.1   |  |      |  | 0.1   | 
|Energy                      |  |              | 0.0   |  |      |  | 0.1   | 
|Manufacturing               |  |              | 0.8   |  |      |  | 0.8   | 
|Construction and property   |  |              | 6.9   |  |      |  | 5.3   | 
|Distribution                |  |              | 0.3   |  |      |  | 0.2   | 
|Transport                   |  |              | 0.3   |  |      |  | 0.4   | 
|Financial                   |  |              | 0.4   |  |      |  | 0.3   | 
|Business and other services |  |              | 2.2   |  |      |  | 2.1   | 
|Commercial mortgages        |  |              | 2.6   |  |      |  | 2.8   | 
|Personal                    |  |              |       |  |      |  |       | 
| residential mortgages     |  |              | 30.7  |  |      |  | 32.0  | 
| other lending             |  |              | 2.4   |  |      |  | 2.3   | 
|                            |  |              |       |  |      | 
|                            |  |              | 46.7  |  |      |  | 46.4  | 
|                            |  |              |       |  |      | 
|Group total loan portfolio  |  |              | 100.0 |  |      |  | 100.0 | 
|                            |  |              |       |  |      | 

59



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##### Table of Contents



Total loans to customers by origin (%) (Continued)


Table 2


|                            |  |              |       |  |         |  |       |         |  |  |       | 
|--------------------------- |  | ------------ | ----- |  | ------- |  | ----- | ------- |  |  | ----- | 
|                            |  | At March 31, |      
|                            |  |              |      
|                            |  | 2004         |       |  | 2003    |  |       | 2002    | 
|                            |  | IR GAAP      |       |  | IR GAAP |  |       | IR GAAP | 
|                            |  |              |       |  |         |  |       |         | 
|                            |  | %            |       |  | %       |  |       | %       | 
|Ireland                     |  |              |       |  |         |  |       |         |  |  |       | 
|Agriculture                 |  |              | 1.7   |  |         |  | 2.0   |         |  |  | 2.0   | 
|Energy                      |  |              | 0.7   |  |         |  | 1.1   |         |  |  | 1.2   | 
|Manufacturing               |  |              | 5.3   |  |         |  | 6.7   |         |  |  | 6.8   | 
|Construction and property   |  |              | 9.0   |  |         |  | 8.1   |         |  |  | 6.4   | 
|Distribution                |  |              | 2.3   |  |         |  | 2.4   |         |  |  | 2.4   | 
|Transport                   |  |              | 1.4   |  |         |  | 0.9   |         |  |  | 1.6   | 
|Financial                   |  |              | 1.9   |  |         |  | 1.4   |         |  |  | 3.4   | 
|Business and other services |  |              | 4.6   |  |         |  | 5.0   |         |  |  | 4.3   | 
|Personal                    |  |              |       |  |         |  |       |         |  |  |       | 
| residential mortgages     |  |              | 18.2  |  |         |  | 17.5  |         |  |  | 13.9  | 
| other lending             |  |              | 5.3   |  |         |  | 5.3   |         |  |  | 4.8   | 
|                            |  |              |       |  |         |  |       |         | 
|                            |  |              | 50.4  |  |         |  | 50.4  |         |  |  | 46.8  | 
|                            |  |              |       |  |         |  |       |         | 
|United Kingdom              |  |              |       |  |         |  |       |         |  |  |       | 
|Agriculture                 |  |              | 0.1   |  |         |  | 0.1   |         |  |  | 0.1   | 
|Energy                      |  |              | 0.1   |  |         |  | 0.3   |         |  |  | 0.2   | 
|Manufacturing               |  |              | 1.9   |  |         |  | 1.3   |         |  |  | 1.0   | 
|Construction and property   |  |              | 3.7   |  |         |  | 3.4   |         |  |  | 3.7   | 
|Distribution                |  |              | 0.3   |  |         |  | 0.4   |         |  |  | 0.4   | 
|Transport                   |  |              | 0.5   |  |         |  | 0.4   |         |  |  | 0.1   | 
|Financial                   |  |              | 0.3   |  |         |  | 0.2   |         |  |  | 0.3   | 
|Business and other services |  |              | 2.0   |  |         |  | 2.2   |         |  |  | 1.9   | 
|Commercial mortgages        |  |              | 3.1   |  |         |  | 3.2   |         |  |  | 3.5   | 
|Personal                    |  |              |       |  |         |  |       |         |  |  |       | 
| residential mortgages     |  |              | 35.4  |  |         |  | 36.4  |         |  |  | 40.2  | 
| other lending             |  |              | 2.2   |  |         |  | 1.7   |         |  |  | 1.8   | 
|                            |  |              |       |  |         |  |       |         | 
|                            |  |              | 49.6  |  |         |  | 49.6  |         |  |  | 53.2  | 
|                            |  |              |       |  |         |  |       |         | 
|United States               |  |              |       |  |         |  |       |         |  |  |       | 
|Commercial loans            |  |              |      |  |         |  |      |         |  |  |      | 
|                            |  |              |       |  |         |  |       |         | 
|                            |  |              |      |  |         |  |      |         |  |  |      | 
|                            |  |              |       |  |         |  |       |         | 
|Group total loan portfolio  |  |              | 100.0 |  |         |  | 100.0 |         |  |  | 100.0 | 
|                            |  |              |       |  |         |  |       |         | 

60



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##### Table of Contents



Analysis of Loans to Customers by Maturity and Interest
Rate Sensitivity




|                        |  |                      |        |            |         |  |        |         |  |  |        |  |  |  |         | 
|----------------------- |  | -------------------- | ------ | ---------- | ------- |  | ------ | ------- |  |  | ------ |  |  |  | ------- | 
|                        |  | As at March 31, 2006 |       
|                        |  | IFRS                 |       
|                        |  |                      |       
|                        |  |                      |        | After      |         |  |       
|                        |  |                      |        | 1 year but |         |  |       
|                        |  | Within               |        |            | within  |  |        | After   |  |  |       
|                        |  | 1 year               |        |            | 5 years |  |        | 5 years |  |  | Total  | 
|                        |  |                      |        |            |         |  |        |         |  |  |        | 
|                        |  | (in  millions)      |       
|Ireland                 |  |                      | 10,231 |            |         |  | 16,375 |         |  |  | 27,596 |  |  |  | 54,202  | 
|United Kingdom          |  |                      | 4,268  |            |         |  | 8,507  |         |  |  | 34,628 |  |  |  | 47,403  | 
|                        |  |                      |        |            |         |  |        |         |  |  |        | 
|Total loans by maturity |  |                      | 14,499 |            |         |  | 24,882 |         |  |  | 62,224 |  |  |  | 101,605 | 
|                        |  |                      |        |            |         |  |        |         |  |  |        | 
|Fixed rate              |  |                      | 2,007  |            |         |  | 5,784  |         |  |  | 4,117  |  |  |  | 11,908  | 
|Variable rate           |  |                      | 12,492 |            |         |  | 19,098 |         |  |  | 58,107 |  |  |  | 89,697  | 
|                        |  |                      |        |            |         |  |        |         |  |  |        | 
|Total loans by maturity |  |                      | 14,499 |            |         |  | 24,882 |         |  |  | 62,224 |  |  |  | 101,605 | 
|                        |  |                      |        |            |         |  |        |         |  |  |        | 

61



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|                            |  |                      |        |            |         |  |        |         |  |  |        |  |  |  |         | 
|--------------------------- |  | -------------------- | ------ | ---------- | ------- |  | ------ | ------- |  |  | ------ |  |  |  | ------- | 
|                            |  | As at March 31, 2006 |       
|                            |  | IFRS                 |       
|                            |  |                      |       
|                            |  |                      |        | After      |         |  |       
|                            |  |                      |        | 1 year but |         |  |       
|                            |  | Within               |        |            | within  |  |        | After   |  |  |       
|                            |  | 1 year               |        |            | 5 years |  |        | 5 years |  |  | Total  | 
|                            |  |                      |        |            |         |  |        |         |  |  |        | 
|                            |  | (in  millions)      |       
|Ireland                     |  |                      |        |            |         |  |        |         |  |  |        |  |  |  |         | 
|Agriculture                 |  |                      | 388    |            |         |  | 391    |         |  |  | 381    |  |  |  | 1,160   | 
|Energy                      |  |                      | 80     |            |         |  | 155    |         |  |  | 250    |  |  |  | 485     | 
|Manufacturing               |  |                      | 880    |            |         |  | 2,509  |         |  |  | 1,461  |  |  |  | 4,850   | 
|Construction and property   |  |                      | 3,103  |            |         |  | 4,397  |         |  |  | 3,226  |  |  |  | 10,726  | 
|Distribution                |  |                      | 780    |            |         |  | 923    |         |  |  | 1,283  |  |  |  | 2,986   | 
|Transport                   |  |                      | 314    |            |         |  | 690    |         |  |  | 164    |  |  |  | 1,168   | 
|Financial                   |  |                      | 393    |            |         |  | 500    |         |  |  | 783    |  |  |  | 1,676   | 
|Business and other services |  |                      | 1,300  |            |         |  | 2,023  |         |  |  | 2,789  |  |  |  | 6,112   | 
|Personal                    |  |                      |        |            |         |  |        |         |  |  |        |  |  |  |         | 
| residential mortgages     |  |                      | 859    |            |         |  | 3,017  |         |  |  | 15,951 |  |  |  | 19,827  | 
| other lending             |  |                      | 2,134  |            |         |  | 1,770  |         |  |  | 1,308  |  |  |  | 5,212   | 
|                            |  |                      |        |            |         |  |        |         |  |  |        | 
|                            |  |                      | 10,231 |            |         |  | 16,375 |         |  |  | 27,596 |  |  |  | 54,202  | 
|                            |  |                      |        |            |         |  |        |         |  |  |        | 
|United Kingdom              |  |                      |        |            |         |  |        |         |  |  |        |  |  |  |         | 
|Agriculture                 |  |                      | 27     |            |         |  | 26     |         |  |  | 16     |  |  |  | 69      | 
|Energy                      |  |                      | 29     |            |         |  | 19     |         |  |  |       |  |  |  | 48      | 
|Manufacturing               |  |                      | 367    |            |         |  | 400    |         |  |  | 75     |  |  |  | 842     | 
|Construction and property   |  |                      | 1,223  |            |         |  | 3,704  |         |  |  | 2,130  |  |  |  | 7,057   | 
|Distribution                |  |                      | 24     |            |         |  | 160    |         |  |  | 105    |  |  |  | 289     | 
|Transport                   |  |                      | 116    |            |         |  | 139    |         |  |  | 37     |  |  |  | 292     | 
|Financial                   |  |                      | 286    |            |         |  | 112    |         |  |  | 32     |  |  |  | 430     | 
|Business and other services |  |                      | 603    |            |         |  | 704    |         |  |  | 892    |  |  |  | 2,199   | 
|Commercial Mortgages        |  |                      | 140    |            |         |  | 736    |         |  |  | 1,719  |  |  |  | 2,595   | 
|Personal                    |  |                      |        |            |         |  |        |         |  |  |        |  |  |  |         | 
| residential mortgages     |  |                      | 266    |            |         |  | 1,698  |         |  |  | 29,207 |  |  |  | 31,171  | 
| other lending             |  |                      | 1,187  |            |         |  | 809    |         |  |  | 415    |  |  |  | 2,411   | 
|                            |  |                      |        |            |         |  |        |         |  |  |        | 
|                            |  |                      | 4,268  |            |         |  | 8,507  |         |  |  | 34,628 |  |  |  | 47,403  | 
|                            |  |                      |        |            |         |  |        |         |  |  |        | 
|Group total loan portfolio  |  |                      | 14,499 |            |         |  | 24,882 |         |  |  | 62,224 |  |  |  | 101,605 | 
|                            |  |                      |        |            |         |  |        |         |  |  |        | 

Movement in the Allowance for Loan Losses










62



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##### Table of Contents





  


   


63



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##### Table of Contents



Movement in the Allowance for Loan Losses




Table 1


|                                                   |                |                      |       |       |            |  |        |        |  
|-------------------------------------------------- | -------------- | -------------------- | ----- | ----- | ---------- |  | ------ | ------ | -
|                                                   |                | Financial year ended |      
|                                                   |                | March 31,            |      
|                                                   |                |                      |      
|                                                   |                | 2006                 |       |       | 2005       | 
|                                                   |                | IFRS                 |       |       | IFRS(1)    | 
|                                                   |                |                      |       |       |            | 
|                                                   |                | Impairment           |       |       | Impairment | 
|                                                   |                |                      |       |       |            | 
|                                                   |                | (in  millions)      |      
|Allowance at beginning of year                     |                |                      | 318.7 |       |            |  | 471.8  |       
|Total allowance                                    |                |                      | 318.7 |       |            |  | 471.8  |       
|                                                   |                |                      |       |       |            | 
|Exchange adjustments                               |                |                      | 0.6   |       |            |  | (9.2   | )     
|                                                   |                |                      |       |       |            | 
|Recovery of amounts previously charged off:        |                |                      |       |       |            |  |        |       
|                                                   | Ireland        |                      |       | 19.6  |            |  |        | 19.5   |  
|                                                   | United Kingdom |                      |       | 1.7   |            |  |        | 1.9    |  
|                                                   |                |                      |       |       |            | 
|Total recovery of amounts previously charged off   |                |                      | 21.3  |       |            |  | 21.4   |       
|                                                   |                |                      |       |       |            | 
|Amounts charged off:                               |                |                      |       |       |            |  |        |       
|                                                   | Ireland        |                      |       | (71.9 | )          |  |        | (131.9 | )
|                                                   | United Kingdom |                      |       | (13.1 | )          |  |        | (12.6  | )
|                                                   |                |                      |       |       |            | 
|Total amounts charged off                          |                |                      | (85.0 | )     |            |  | (144.5 | )     
|                                                   |                |                      |       |       |            | 
|Provision for impairment losses charged to income: |                |                      |       |       |            |  |        |       
|                                                   | Ireland        |                      |       | 73.5  |            |  |        | 86.6   |  
|                                                   | United Kingdom |                      |       | 29.9  |            |  |        | (7.4   | )
|                                                   |                |                      |       |       |            | 
|                                                   |                |                      | 103.4 |       |            |  | 79.2   |       
|                                                   |                |                      |       |       |            | 
|Impairment loss write back                         |                |                      |      |       |            |  | (100.0 | )     
|                                                   |                |                      |       |       |            | 
|Allowance at end of year                           |                |                      | 359.0 |       |            |  | 318.7  |       
|                                                   |                |                      |       |       |            | 
|Total allowance                                    |                |                      | 359.0 |       |            |  | 318.7  |       
|                                                   |                |                      |       |       |            | 






|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32,
    39 and IFRS 4.

64



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##### Table of Contents



Movement in the Allowance for Loan Losses (Continued)


Table 2


|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         |  |       |       |   |  |       |      | 
|------------------------------------------------ | -------------- | ------------------------------ | ------ | ------ | ------- | ----- | ----- | -------- | - |  | ------- | ----- | - | -------- | ----- | ----- | ------- |  | ----- | ----- | - |  | ----- | ---- | 
|                                                 |                | Financial year ended March 31, |       
|                                                 |                |                                |       
|                                                 |                | 2004                           |        |        | 2003    |       |       | 2002     |  
|                                                 |                | IR GAAP                        |        |        | IR GAAP |       |       | IR GAAP  |  
|                                                 |                |                                |        |        |         |       |       |          |  
|                                                 |                | Specific                       |        |        | General |       |       | Specific |   |  | General |       |   | Specific |       |       | General | 
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|                                                 |                | (in  millions)                |       
|Allowance at beginning of year                   |                |                                | 169.5  |        |         |       | 310.2 |          |   |  | 158.8   |       |   |          | 341.4 |       |         |  | 123.2 |       |   |  | 307.2 |     
|Total allowance                                  |                | 479.7                          |        | 500.2  |         | 430.4
|                                                 |                |                                |        |        |         |      
|Exchange adjustments                             |                |                                | 1.3    |        |         |       | 5.9   |          |   |  | (7.7    | )     |   |          | (22.4 | )     |         |  | 1.4   |       |   |  | 2.2   |     
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|Recovery of amounts previously charged off:      |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         |  |       |       |   |  |       |     
|                                                 | Ireland        |                                |        | 12.3   |         |       |       |         |   |  |         | 4.1   |   |          |       |      |         |  |       | 14.4  |   |  |       |     | 
|                                                 | United Kingdom |                                |        | 0.7    |         |       |       |         |   |  |         | 1.5   |   |          |       |      |         |  |       | 4.7   |   |  |       |     | 
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|Total recovery of amounts previously charged off |                |                                | 13.0   |        |         |       |      |          |   |  | 5.6     |       |   |          |      |       |         |  | 19.1  |       |   |  |      |     
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|Amounts charged off:                             |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         |  |       |       |   |  |       |     
|                                                 | Ireland        |                                |        | (105.3 | )       |       |       |         |   |  |         | (77.4 | ) |          |       |      |         |  |       | (39.0 | ) |  |       |     | 
|                                                 | United Kingdom |                                |        | (9.3   | )       |       |       |         |   |  |         | (19.0 | ) |          |       |      |         |  |       | (16.1 | ) |  |       |     | 
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|Total amounts charged off                        |                |                                | (114.6 | )      |         |       |      |          |   |  | (96.4   | )     |   |          |      |       |         |  | (55.1 | )     |   |  |      |     
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|Provision for loan losses charged to income:     |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         |  |       |       |   |  |       |     
|                                                 | Ireland        |                                |        | 113.0  |         |       |       | (29.7    | ) |  |         | 102.5 |   |          |       | (25.2 | )       |  |       | 62.1  |   |  |       | 9.6  | 
|                                                 | United Kingdom |                                |        | 8.6    |         |       |       | (5.4     | ) |  |         | 6.7   |   |          |       | 16.4  |         |  |       | 8.1   |   |  |       | 22.4 | 
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|                                                 |                |                                | 121.6  |        |         |       | (35.1 | )        |   |  | 109.2   |       |   |          | (8.8  | )     |         |  | 70.2  |       |   |  | 32.0  |     
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|Allowance at end of year                         |                |                                | 190.8  |        |         |       | 281.0 |          |   |  | 169.5   |       |   |          | 310.2 |       |         |  | 158.8 |       |   |  | 341.4 |     
|                                                 |                |                                |        |        |         |       |       |          |   |  |         |       |   |          |       |       |         | 
|Total allowance                                  |                | 471.8                          |        | 479.7  |         | 500.2
|                                                 |                |                                |        |        |         |      

65



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##### Table of Contents



Provisions and allowances for loan losses (%)




Table 1


|                                                                                         |  |                              |        |  |         |  |        |  
|---------------------------------------------------------------------------------------- |  | ---------------------------- | ------ |  | ------- |  | ------ | -
|                                                                                         |  | For the Financial Year Ended |       
|                                                                                         |  | March 31,                    |       
|                                                                                         |  |                              |       
|                                                                                         |  | 2006                         |        |  | 2005    | 
|                                                                                         |  | IFRS                         |        |  | IFRS(1) | 
|                                                                                         |  |                              |        |  |         | 
|                                                                                         |  | (in  millions,              |       
|                                                                                         |  | except percentages)          |       
|                                                                                         |  | %                            |        |  | %       | 
|Allowance at end of year as a percentage of total loans to
    customers at end of year: |  |                              |        |  |         |  |        |  
|Ireland                                                                                  |  |                              | 0.53   |  |         |  | 0.64   |  
|United Kingdom                                                                           |  |                              | 0.15   |  |         |  | 0.11   |  
|                                                                                         |  |                              |        |  |         | 
|Total                                                                                    |  |                              | 0.35   |  |         |  | 0.40   |  
|                                                                                         |  |                              |        |  |         | 
|Specific                                                                                 |  |                              | 0.23   |  |         |  | 0.23   |  
|IBNR                                                                                     |  |                              | 0.12   |  |         |  | 0.17   |  
|                                                                                         |  |                              |        |  |         | 
|Total                                                                                    |  |                              | 0.35   |  |         |  | 0.40   |  
|                                                                                         |  |                              |        |  |         | 
|Allowance at end of year as a percentage of impaired loans at
    end of year(2)         |  |                              |        |  |         |  |        |  
|Ireland                                                                                  |  |                              | 51.08  |  |         |  | 100.5  |  
|United Kingdom                                                                           |  |                              | 30.86  |  |         |  | 70.0   |  
|                                                                                         |  |                              |        |  |         | 
|Total                                                                                    |  |                              | 45.25  |  |         |  | 95.1   |  
|                                                                                         |  |                              |        |  |         | 
|Average loans to customers(3)                                                            |  |                              | 93,075 |  |         |  | 74,304 |  
|Provisions charged to income as a percentage of average loans to
    customers:          |  |                              |        |  |         |  |        |  
|Specific                                                                                 |  |                              | 0.10   |  |         |  | 0.16   |  
|IBNR                                                                                     |  |                              | 0.01   |  |         |  | (0.05  | )
|                                                                                         |  |                              |        |  |         | 
|Total                                                                                    |  |                              | 0.11   |  |         |  | 0.11   |  
|                                                                                         |  |                              |        |  |         | 
|Net loans charged off as a percentage of average loans to
    customers                  |  |                              | 0.07   |  |         |  | 0.17   |  
|                                                                                         |  |                              |        |  |         | 






|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32,
    39 and IFRS 4.

66



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##### Table of Contents



Provisions and allowances for loan losses
(%) (continued)


Table 2


|                                                                                                              |  |                              |        |   |         |  |        |         |  |  |        | 
|------------------------------------------------------------------------------------------------------------- |  | ---------------------------- | ------ | - | ------- |  | ------ | ------- |  |  | ------ | 
|                                                                                                              |  | For the Financial Year ended |       
|                                                                                                              |  | March 31,                    |       
|                                                                                                              |  |                              |       
|                                                                                                              |  | 2004                         |        |   | 2003    |  |        | 2002    | 
|                                                                                                              |  | IR GAAP                      |        |   | IR GAAP |  |        | IR GAAP | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|                                                                                                              |  | %                            |        |   | %       |  |        | %       | 
|Allowance at end of year as a percentage of total loans to
    customers at end of year:                      |  |                              |        |   |         |  |        |         |  |  |        | 
|Ireland                                                                                                       |  |                              | 0.92   |   |         |  | 1.12   |         |  |  | 1.02   | 
|United Kingdom                                                                                                |  |                              | 0.46   |   |         |  | 0.54   |         |  |  | 0.75   | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Total                                                                                                         |  |                              | 0.69   |   |         |  | 0.84   |         |  |  | 0.88   | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Specific                                                                                                      |  |                              | 0.28   |   |         |  | 0.30   |         |  |  | 0.28   | 
|General                                                                                                       |  |                              | 0.41   |   |         |  | 0.54   |         |  |  | 0.60   | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Total                                                                                                         |  |                              | 0.69   |   |         |  | 0.84   |         |  |  | 0.88   | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Allowance at end of year as a percentage of loans accounted for
    on a non-accrual basis at end of year:(2) |  |                              |        |   |         |  |        |         |  |  |        | 
|Ireland                                                                                                       |  |                              | 98.0   |   |         |  | 121.3  |         |  |  | 126.5  | 
|United Kingdom                                                                                                |  |                              | 293.2  |   |         |  | 300.5  |         |  |  | 197.9  | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Total                                                                                                         |  |                              | 125.7  |   |         |  | 150.1  |         |  |  | 151.3  | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Average loans to customers(3)                                                                                 |  |                              | 62,129 |   |         |  | 57,145 |         |  |  | 55,197 | 
|Provisions charged to income as a percentage of average loans to
    customers:                               |  |                              |        |   |         |  |        |         |  |  |        | 
|Specific                                                                                                      |  |                              | 0.20   |   |         |  | 0.20   |         |  |  | 0.13   | 
|General                                                                                                       |  |                              | (0.06  | ) |         |  | (0.02  | )       |  |  | 0.06   | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Total                                                                                                         |  |                              | 0.14   |   |         |  | 0.18   |         |  |  | 0.19   | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 
|Net loans charged off as a percentage of average loans to
    customers                                       |  |                              | 0.16   |   |         |  | 0.16   |         |  |  | 0.07   | 
|                                                                                                              |  |                              |        |   |         |  |        |         | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Prior to the implementation of IFRS accruing loans which were
    contractually past due 90 days or more as to principal or
    interest payments and loans which were troubled debt
    restructurings as defined in SFAS No. 15
    Accounting by Debtors and Creditors for Troubled Debt
    Restructuring were not included. The March 2006
    calculation (45.25%) which is based on impaired loans does
    include accruing loans which are contractually past due
    90 days or more as to principal or interest payments. The
    comparable figure for March 2005 is 44.93%.
|   
|(3) | Average loans include average interest earning and non-interest
    earning loans.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

67



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##### Table of Contents



Loans charged off




Table 1


|                            |  |                 |      |  |                 |  |       | 
|--------------------------- |  | --------------- | ---- |  | --------------- |  | ----- | 
|                            |  | At March 31,    |     
|                            |  |                 |     
|                            |  | 2006            |      |  | 2005            | 
|                            |  | IFRS            |      |  | IFRS(1)         | 
|                            |  |                 |      |  |                 | 
|                            |  | (in  millions) |      |  | (in  millions) | 
|Ireland                     |  |                 |      |  |                 |  |       | 
|Agriculture                 |  |                 | 2.0  |  |                 |  | 3.6   | 
|Energy                      |  |                 |     |  |                 |  | 7.7   | 
|Manufacturing               |  |                 | 1.2  |  |                 |  | 1.5   | 
|Construction and property   |  |                 | 1.8  |  |                 |  | 2.2   | 
|Distribution                |  |                 | 2.9  |  |                 |  | 2.0   | 
|Transport                   |  |                 |     |  |                 |  |      | 
|Financial                   |  |                 |     |  |                 |  |      | 
|Business and Other Services |  |                 | 20.7 |  |                 |  | 47.2  | 
|Personal                    |  |                 |      |  |                 |  |       | 
| Residential Mortgages     |  |                 |     |  |                 |  |      | 
| Other lending             |  |                 | 43.3 |  |                 |  | 67.7  | 
|                            |  |                 |      |  |                 | 
|                            |  |                 | 71.9 |  |                 |  | 131.9 | 
|                            |  |                 |      |  |                 | 
|United Kingdom              |  |                 |      |  |                 |  |       | 
|Agriculture                 |  |                 | 0.1  |  |                 |  | 0.1   | 
|Manufacturing               |  |                 | 0.4  |  |                 |  | 2.8   | 
|Construction and property   |  |                 | 0.2  |  |                 |  | 0.1   | 
|Distribution                |  |                 | 0.4  |  |                 |  | 0.1   | 
|Transport                   |  |                 |     |  |                 |  |      | 
|Financial                   |  |                 |     |  |                 |  |      | 
|Business and Other Services |  |                 | 0.6  |  |                 |  | 1.5   | 
|Commercial mortgages        |  |                 | 0.4  |  |                 |  | 1.0   | 
|Personal                    |  |                 |      |  |                 |  |       | 
| Residential Mortgages     |  |                 |     |  |                 |  |      | 
| Other lending             |  |                 | 11.0 |  |                 |  | 7.0   | 
|                            |  |                 |      |  |                 | 
|                            |  |                 | 13.1 |  |                 |  | 12.6  | 
|                            |  |                 |      |  |                 | 
|Group total                 |  |                 | 85.0 |  |                 |  | 144.5 | 
|                            |  |                 |      |  |                 | 






|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32, 39
    and IFRS 4.

68



---



##### Table of Contents



Loans charged off (continued)


Table 2


|                            |  |                 |       |  |         |  |      |         |  |  |      | 
|--------------------------- |  | --------------- | ----- |  | ------- |  | ---- | ------- |  |  | ---- | 
|                            |  | At March 31,    |      
|                            |  |                 |      
|                            |  | 2004            |       |  | 2003    |  |      | 2002    | 
|                            |  | IR GAAP         |       |  | IR GAAP |  |      | IR GAAP | 
|                            |  |                 |       |  |         |  |      |         | 
|                            |  | (in  millions) |      
|Ireland                     |  |                 |       |  |         |  |      |         |  |  |      | 
|Agriculture                 |  |                 | 3.3   |  |         |  | 2.9  |         |  |  | 1.7  | 
|Energy                      |  |                 | 15.4  |  |         |  | 5.0  |         |  |  |     | 
|Manufacturing               |  |                 | 5.2   |  |         |  | 21.9 |         |  |  | 12.8 | 
|Construction and property   |  |                 | 4.3   |  |         |  | 1.8  |         |  |  | 0.8  | 
|Distribution                |  |                 | 1.6   |  |         |  | 2.1  |         |  |  | 1.3  | 
|Transport                   |  |                 |      |  |         |  |     |         |  |  |     | 
|Financial                   |  |                 |      |  |         |  |     |         |  |  |     | 
|Business and Other Services |  |                 | 22.1  |  |         |  | 14.5 |         |  |  | 5.7  | 
|Personal                    |  |                 |       |  |         |  |      |         |  |  |      | 
| Residential Mortgages     |  |                 |      |  |         |  |     |         |  |  |     | 
| Other lending             |  |                 | 53.4  |  |         |  | 29.2 |         |  |  | 16.7 | 
|                            |  |                 |       |  |         |  |      |         | 
|                            |  |                 | 105.3 |  |         |  | 77.4 |         |  |  | 39.0 | 
|                            |  |                 |       |  |         |  |      |         | 
|United Kingdom              |  |                 |       |  |         |  |      |         |  |  |      | 
|Agriculture                 |  |                 | 0.1   |  |         |  | 0.1  |         |  |  | 0.1  | 
|Manufacturing               |  |                 | 0.6   |  |         |  | 7.6  |         |  |  | 0.9  | 
|Construction and property   |  |                 | 0.5   |  |         |  | 1.1  |         |  |  | 0.4  | 
|Distribution                |  |                 | 0.5   |  |         |  | 0.3  |         |  |  | 4.5  | 
|Transport                   |  |                 |      |  |         |  |     |         |  |  |     | 
|Financial                   |  |                 |      |  |         |  |     |         |  |  |     | 
|Business and Other Services |  |                 | 1.2   |  |         |  | 2.7  |         |  |  | 1.2  | 
|Commercial mortgages        |  |                 | 1.4   |  |         |  | 2.2  |         |  |  |     | 
|Personal                    |  |                 |       |  |         |  |      |         |  |  |      | 
| Residential Mortgages     |  |                 | 0.6   |  |         |  | 0.2  |         |  |  | 3.8  | 
| Other lending             |  |                 | 4.4   |  |         |  | 4.8  |         |  |  | 5.2  | 
|                            |  |                 |       |  |         |  |      |         | 
|                            |  |                 | 9.3   |  |         |  | 19.0 |         |  |  | 16.1 | 
|                            |  |                 |       |  |         |  |      |         | 
|Group total                 |  |                 | 114.6 |  |         |  | 96.4 |         |  |  | 55.1 | 
|                            |  |                 |       |  |         |  |      |         | 

69



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##### Table of Contents



Recoveries of loans previously charged off




Table 1


|                            |  |                 |      |  |         |  |      | 
|--------------------------- |  | --------------- | ---- |  | ------- |  | ---- | 
|                            |  | At March 31,    |     
|                            |  |                 |     
|                            |  | 2006            |      |  | 2005    | 
|                            |  | IFRS            |      |  | IFRS(1) | 
|                            |  |                 |      |  |         | 
|                            |  | (in  millions) |     
|Ireland                     |  |                 |      |  |         |  |      | 
|Agriculture                 |  |                 | 0.5  |  |         |  | 0.6  | 
|Manufacturing               |  |                 | 0.2  |  |         |  | 1.0  | 
|Construction and property   |  |                 | 0.3  |  |         |  | 0.8  | 
|Distribution                |  |                 | 0.3  |  |         |  | 0.3  | 
|Transport                   |  |                 |     |  |         |  |     | 
|Financial                   |  |                 |     |  |         |  |     | 
|Business and Other Services |  |                 | 8.2  |  |         |  | 6.9  | 
|Personal                    |  |                 |      |  |         |  |      | 
| Residential Mortgages     |  |                 |     |  |         |  |     | 
| Other lending             |  |                 | 10.1 |  |         |  | 9.9  | 
|                            |  |                 |      |  |         | 
|                            |  |                 | 19.6 |  |         |  | 19.5 | 
|                            |  |                 |      |  |         | 
|United Kingdom              |  |                 |      |  |         |  |      | 
|Agriculture                 |  |                 | 0.1  |  |         |  |     | 
|Manufacturing               |  |                 | 0.3  |  |         |  | 0.1  | 
|Construction and property   |  |                 | 0.1  |  |         |  | 0.1  | 
|Distribution                |  |                 | 0.1  |  |         |  | 0.1  | 
|Transport                   |  |                 |     |  |         |  |     | 
|Financial                   |  |                 |     |  |         |  |     | 
|Business and Other Services |  |                 | 0.2  |  |         |  | 0.3  | 
|Commercial mortgages        |  |                 | 0.1  |  |         |  | 0.3  | 
|Personal                    |  |                 |      |  |         |  |      | 
| Residential Mortgages     |  |                 |     |  |         |  | 0.1  | 
| Other lending             |  |                 | 0.8  |  |         |  | 0.9  | 
|                            |  |                 |      |  |         | 
|                            |  |                 | 1.7  |  |         |  | 1.9  | 
|                            |  |                 |      |  |         | 
|Group total                 |  |                 | 21.3 |  |         |  | 21.4 | 
|                            |  |                 |      |  |         | 






|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32,
    39 and IFRS 4.

70



---



##### Table of Contents



Recoveries of loans previously charged
off (continued)


Table 2


|                            |  |                 |      |  |         |  |     |         |  |  |      | 
|--------------------------- |  | --------------- | ---- |  | ------- |  | --- | ------- |  |  | ---- | 
|                            |  | At March 31,    |     
|                            |  |                 |     
|                            |  | 2004            |      |  | 2003    |  |     | 2002    | 
|                            |  | IR GAAP         |      |  | IR GAAP |  |     | IR GAAP | 
|                            |  |                 |      |  |         |  |     |         | 
|                            |  | (in  millions) |     
|Ireland                     |  |                 |      |  |         |  |     |         |  |  |      | 
|Agriculture                 |  |                 | 0.5  |  |         |  | 0.2 |         |  |  | 1.2  | 
|Manufacturing               |  |                 | 3.5  |  |         |  | 1.3 |         |  |  | 0.1  | 
|Construction and property   |  |                 | 0.3  |  |         |  | 0.1 |         |  |  | 0.3  | 
|Distribution                |  |                 | 0.3  |  |         |  | 0.1 |         |  |  | 0.8  | 
|Transport                   |  |                 |     |  |         |  |    |         |  |  |     | 
|Financial                   |  |                 |     |  |         |  |    |         |  |  |     | 
|Business and Other Services |  |                 | 3.1  |  |         |  | 0.6 |         |  |  | 2.7  | 
|Personal                    |  |                 |      |  |         |  |     |         |  |  |      | 
| Residential Mortgages     |  |                 |     |  |         |  |    |         |  |  |     | 
| Other lending             |  |                 | 4.6  |  |         |  | 1.8 |         |  |  | 9.3  | 
|                            |  |                 |      |  |         |  |     |         | 
|                            |  |                 | 12.3 |  |         |  | 4.1 |         |  |  | 14.4 | 
|                            |  |                 |      |  |         |  |     |         | 
|United Kingdom              |  |                 |      |  |         |  |     |         |  |  |      | 
|Agriculture                 |  |                 |     |  |         |  |    |         |  |  |     | 
|Manufacturing               |  |                 | 0.3  |  |         |  | 0.1 |         |  |  | 0.2  | 
|Construction and property   |  |                 |     |  |         |  |    |         |  |  | 1.5  | 
|Distribution                |  |                 |     |  |         |  | 0.4 |         |  |  | 0.1  | 
|Transport                   |  |                 |     |  |         |  |    |         |  |  |     | 
|Financial                   |  |                 |     |  |         |  |    |         |  |  |     | 
|Business and Other Services |  |                 | 0.1  |  |         |  | 0.1 |         |  |  | 1.1  | 
|Commercial mortgages        |  |                 | 0.1  |  |         |  | 0.4 |         |  |  |     | 
|Personal                    |  |                 |      |  |         |  |     |         |  |  |      | 
| Residential Mortgages     |  |                 |     |  |         |  |    |         |  |  | 1.5  | 
| Other lending             |  |                 | 0.2  |  |         |  | 0.5 |         |  |  | 0.3  | 
|                            |  |                 |      |  |         |  |     |         | 
|                            |  |                 | 0.7  |  |         |  | 1.5 |         |  |  | 4.7  | 
|                            |  |                 |      |  |         |  |     |         | 
|Group total                 |  |                 | 13.0 |  |         |  | 5.6 |         |  |  | 19.1 | 
|                            |  |                 |      |  |         |  |     |         | 

71



---



##### Table of Contents



Analysis of allowances for loan losses by sector




Table 1


|                            |  |                 |       |  |         |  |       | 
|--------------------------- |  | --------------- | ----- |  | ------- |  | ----- | 
|                            |  | At March 31,    |      
|                            |  |                 |      
|                            |  | 2006            |       |  | 2005    | 
|                            |  | IFRS            |       |  | IFRS(1) | 
|                            |  |                 |       |  |         | 
|                            |  | (in  millions) |      
|Ireland                     |  |                 |       |  |         |  |       | 
|Agriculture                 |  |                 | 10.4  |  |         |  | 11.6  | 
|Energy                      |  |                 | 0.1   |  |         |  | 8.4   | 
|Manufacturing               |  |                 | 5.3   |  |         |  | 8.4   | 
|Construction and property   |  |                 | 8.5   |  |         |  | 5.6   | 
|Distribution                |  |                 | 9.1   |  |         |  | 6.6   | 
|Transport                   |  |                 |      |  |         |  |      | 
|Financial                   |  |                 |      |  |         |  |      | 
|Business and Other Services |  |                 | 95.0  |  |         |  | 51.5  | 
|Personal                    |  |                 |       |  |         |  |       | 
| Residential Mortgages     |  |                 | 7.8   |  |         |  | 4.0   | 
| Other lending             |  |                 | 52.9  |  |         |  | 60.4  | 
|                            |  |                 |       |  |         | 
|                            |  |                 | 189.1 |  |         |  | 156.5 | 
|                            |  |                 |       |  |         | 
|United Kingdom              |  |                 |       |  |         |  |       | 
|Agriculture                 |  |                 | 0.6   |  |         |  | 0.2   | 
|Manufacturing               |  |                 | 0.9   |  |         |  | 1.4   | 
|Construction and property   |  |                 | 1.2   |  |         |  | 1.9   | 
|Distribution                |  |                 | 0.4   |  |         |  | 0.7   | 
|Transport                   |  |                 |      |  |         |  |      | 
|Financial                   |  |                 |      |  |         |  |      | 
|Business and Other Services |  |                 | 13.8  |  |         |  | 4.4   | 
|Commercial mortgages        |  |                 | 0.3   |  |         |  | 3.5   | 
|Personal                    |  |                 |       |  |         |  |       | 
| Residential Mortgages     |  |                 | 7.4   |  |         |  | 0.7   | 
| Other lending             |  |                 | 18.4  |  |         |  | 12.1  | 
|                            |  |                 |       |  |         | 
|                            |  |                 | 43.0  |  |         |  | 24.9  | 
|                            |  |                 |       |  |         | 
|Total specific allowance    |  |                 | 232.1 |  |         |  | 181.4 | 
|Total IBNR allowance        |  |                 | 126.9 |  |         |  | 137.3 | 
|                            |  |                 |       |  |         | 
|Total group allowance       |  |                 | 359.0 |  |         |  | 318.7 | 
|                            |  |                 |       |  |         | 






|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32,
    39 and IFRS 4.

72



---



##### Table of Contents



Analysis of allowances for loan losses by
sector (continued)


Table 2


|                            |  |                 |       |  |         |  |       |         |  |  |       | 
|--------------------------- |  | --------------- | ----- |  | ------- |  | ----- | ------- |  |  | ----- | 
|                            |  | At March 31,    |      
|                            |  |                 |      
|                            |  | 2004            |       |  | 2003    |  |       | 2002    | 
|                            |  | IR GAAP         |       |  | IR GAAP |  |       | IR GAAP | 
|                            |  |                 |       |  |         |  |       |         | 
|                            |  | (in  millions) |      
|Ireland                     |  |                 |       |  |         |  |       |         |  |  |       | 
|Agriculture                 |  |                 | 13.1  |  |         |  | 11.2  |         |  |  | 10.8  | 
|Energy                      |  |                 | 11.1  |  |         |  | 5.9   |         |  |  | 0.1   | 
|Manufacturing               |  |                 | 6.3   |  |         |  | 9.6   |         |  |  | 20.7  | 
|Construction and property   |  |                 | 8.3   |  |         |  | 12.9  |         |  |  | 4.3   | 
|Distribution                |  |                 | 8.3   |  |         |  | 7.0   |         |  |  | 7.6   | 
|Transport                   |  |                 |      |  |         |  |      |         |  |  |      | 
|Financial                   |  |                 |      |  |         |  |      |         |  |  |      | 
|Business and Other Services |  |                 | 60.7  |  |         |  | 28.9  |         |  |  | 13.6  | 
|Personal                    |  |                 |       |  |         |  |       |         |  |  |       | 
| Residential Mortgages     |  |                 | 0.9   |  |         |  | 0.6   |         |  |  | 0.5   | 
| Other lending             |  |                 | 58.7  |  |         |  | 71.2  |         |  |  | 63.4  | 
|                            |  |                 |       |  |         |  |       |         | 
|                            |  |                 | 167.4 |  |         |  | 147.3 |         |  |  | 121.0 | 
|                            |  |                 |       |  |         |  |       |         | 
|United Kingdom              |  |                 |       |  |         |  |       |         |  |  |       | 
|Agriculture                 |  |                 | 0.1   |  |         |  | 0.1   |         |  |  | 0.1   | 
|Manufacturing               |  |                 | 4.1   |  |         |  | 4.2   |         |  |  | 12.9  | 
|Construction and property   |  |                 | 1.9   |  |         |  | 2.4   |         |  |  | 3.5   | 
|Distribution                |  |                 | 0.6   |  |         |  | 0.5   |         |  |  | 1.4   | 
|Transport                   |  |                 |      |  |         |  |      |         |  |  |      | 
|Financial                   |  |                 |      |  |         |  |      |         |  |  |      | 
|Business and Other Services |  |                 | 5.0   |  |         |  | 4.7   |         |  |  | 7.7   | 
|Commercial mortgages        |  |                 | 1.8   |  |         |  | 1.1   |         |  |  |      | 
|Personal                    |  |                 |       |  |         |  |       |         |  |  |       | 
| Residential Mortgages     |  |                 | 0.2   |  |         |  | 0.3   |         |  |  | 2.9   | 
| Other lending             |  |                 | 9.7   |  |         |  | 8.9   |         |  |  | 9.3   | 
|                            |  |                 |       |  |         |  |       |         | 
|                            |  |                 | 23.4  |  |         |  | 22.2  |         |  |  | 37.8  | 
|                            |  |                 |       |  |         |  |       |         | 
|Total specific allowance    |  |                 | 190.8 |  |         |  | 169.5 |         |  |  | 158.8 | 
|Total general allowance     |  |                 | 281.0 |  |         |  | 310.2 |         |  |  | 341.4 | 
|                            |  |                 |       |  |         |  |       |         | 
|Total group allowance       |  |                 | 471.8 |  |         |  | 479.7 |         |  |  | 500.2 | 
|                            |  |                 |       |  |         |  |       |         | 

73



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##### Table of Contents



Loan losses as a percentage of total loans




Table 1


|                            |  |              |      |  |         |  |      | 
|--------------------------- |  | ------------ | ---- |  | ------- |  | ---- | 
|                            |  | At March 31, |     
|                            |  |              |     
|                            |  | 2006         |      |  | 2005    | 
|                            |  | IFRS         |      |  | IFRS(1) | 
|                            |  |              |      |  |         | 
|                            |  | (%)          |      |  | (%)     | 
|Ireland                     |  |              |      |  |         |  |      | 
|Agriculture                 |  |              | 0.90 |  |         |  | 1.01 | 
|Energy                      |  |              | 0.02 |  |         |  | 1.76 | 
|Manufacturing               |  |              | 0.11 |  |         |  | 0.20 | 
|Construction and property   |  |              | 0.08 |  |         |  | 0.07 | 
|Distribution                |  |              | 0.30 |  |         |  | 0.29 | 
|Transport                   |  |              |     |  |         |  |     | 
|Financial                   |  |              |     |  |         |  |     | 
|Business and Other Services |  |              | 1.57 |  |         |  | 1.24 | 
|Personal                    |  |              |      |  |         |  |      | 
| Residential Mortgages     |  |              | 0.03 |  |         |  | 0.03 | 
| Other lending             |  |              | 1.05 |  |         |  | 1.33 | 
|                            |  |              |      |  |         | 
|                            |  |              | 0.35 |  |         |  | 0.36 | 
|                            |  |              |      |  |         | 
|United Kingdom              |  |              |      |  |         |  |      | 
|Agriculture                 |  |              | 0.87 |  |         |  | 0.30 | 
|Manufacturing               |  |              | 0.11 |  |         |  | 0.21 | 
|Construction and property   |  |              | 0.02 |  |         |  | 0.04 | 
|Distribution                |  |              | 0.14 |  |         |  | 0.38 | 
|Transport                   |  |              |     |  |         |  |     | 
|Financial                   |  |              |     |  |         |  |     | 
|Business and Other Services |  |              | 0.63 |  |         |  | 0.25 | 
|Commercial mortgages        |  |              | 0.01 |  |         |  | 0.16 | 
|Personal                    |  |              |      |  |         |  |      | 
| Residential Mortgages     |  |              | 0.02 |  |         |  |     | 
| Other lending             |  |              | 0.76 |  |         |  | 0.66 | 
|                            |  |              |      |  |         | 
|                            |  |              | 0.09 |  |         |  | 0.07 | 
|                            |  |              |      |  |         | 
|Total specific allowance    |  |              | 0.23 |  |         |  | 0.23 | 
|Total IBNR allowance        |  |              | 0.12 |  |         |  | 0.17 | 
|                            |  |              |      |  |         | 
|Total group allowance       |  |              | 0.35 |  |         |  | 0.40 | 
|                            |  |              |      |  |         | 






|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32, 39
    and IFRS 4.

74



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##### Table of Contents



Loan losses as a percentage of total loans (Continued)


Table 2


|                            |  |             |      |  |         |  |      |         |  |  |      | 
|--------------------------- |  | ----------- | ---- |  | ------- |  | ---- | ------- |  |  | ---- | 
|                            |  | At March 31 |     
|                            |  |             |     
|                            |  | 2004        |      |  | 2003    |  |      | 2002    | 
|                            |  | IR GAAP     |      |  | IR GAAP |  |      | IR GAAP | 
|                            |  |             |      |  |         |  |      |         | 
|                            |  | (%)         |     
|Ireland                     |  |             |      |  |         |  |      |         |  |  |      | 
|Agriculture                 |  |             | 1.16 |  |         |  | 0.98 |         |  |  | 0.97 | 
|Energy                      |  |             | 2.29 |  |         |  | 0.91 |         |  |  | 0.01 | 
|Manufacturing               |  |             | 0.18 |  |         |  | 0.25 |         |  |  | 0.53 | 
|Construction and property   |  |             | 0.14 |  |         |  | 0.28 |         |  |  | 0.12 | 
|Distribution                |  |             | 0.53 |  |         |  | 0.50 |         |  |  | 0.56 | 
|Transport                   |  |             |     |  |         |  |     |         |  |  |     | 
|Financial                   |  |             |     |  |         |  |     |         |  |  |     | 
|Business and Other Services |  |             | 1.93 |  |         |  | 1.01 |         |  |  | 0.55 | 
|Personal                    |  |             |      |  |         |  |      |         |  |  |      | 
| Residential Mortgages     |  |             | 0.01 |  |         |  | 0.01 |         |  |  | 0.01 | 
| Other lending             |  |             | 1.62 |  |         |  | 2.35 |         |  |  | 2.33 | 
|                            |  |             |      |  |         |  |      |         | 
|                            |  |             | 0.49 |  |         |  | 0.51 |         |  |  | 0.45 | 
|                            |  |             |      |  |         |  |      |         | 
|United Kingdom              |  |             |      |  |         |  |      |         |  |  |      | 
|Agriculture                 |  |             | 0.14 |  |         |  | 0.17 |         |  |  | 0.18 | 
|Manufacturing               |  |             | 0.32 |  |         |  | 0.58 |         |  |  | 2.18 | 
|Construction and property   |  |             | 0.07 |  |         |  | 0.12 |         |  |  | 0.17 | 
|Distribution                |  |             | 0.30 |  |         |  | 0.22 |         |  |  | 0.62 | 
|Transport                   |  |             |     |  |         |  |     |         |  |  |     | 
|Financial                   |  |             |     |  |         |  |     |         |  |  |     | 
|Business and Other Services |  |             | 0.36 |  |         |  | 0.38 |         |  |  | 0.70 | 
|Commercial mortgages        |  |             | 0.08 |  |         |  | 0.06 |         |  |  |     | 
|Personal                    |  |             |      |  |         |  |      |         |  |  |      | 
| Residential Mortgages     |  |             |     |  |         |  |     |         |  |  | 0.01 | 
| Other lending             |  |             | 0.66 |  |         |  | 0.89 |         |  |  | 0.92 | 
|                            |  |             |      |  |         |  |      |         | 
|                            |  |             | 0.07 |  |         |  | 0.08 |         |  |  | 0.12 | 
|                            |  |             |      |  |         |  |      |         | 
|Total specific allowance    |  |             | 0.28 |  |         |  | 0.30 |         |  |  | 0.28 | 
|Total general allowance     |  |             | 0.41 |  |         |  | 0.54 |         |  |  | 0.60 | 
|                            |  |             |      |  |         |  |      |         | 
|Total group allowance       |  |             | 0.69 |  |         |  | 0.84 |         |  |  | 0.88 | 
|                            |  |             |      |  |         |  |      |         | 

Risk Elements in Lending








75



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##### Table of Contents





Table 1


|                                                                                                          |  |                 |     |  |         |  |     | 
|--------------------------------------------------------------------------------------------------------- |  | --------------- | --- |  | ------- |  | --- | 
|                                                                                                          |  | At March 31,    |    
|                                                                                                          |  |                 |    
|                                                                                                          |  | 2006            |     |  | 2005    | 
|                                                                                                          |  | IFRS            |     |  | IFRS(1) | 
|                                                                                                          |  |                 |     |  |         | 
|                                                                                                          |  | (in  millions) |    
|Loans accounted for on a non-accrual basis                                                                |  |                 |     |  |         |  |     | 
|Ireland(2)                                                                                                |  |                 | 284 |  |         |  | 275 | 
|United Kingdom(2)                                                                                         |  |                 | 57  |  |         |  | 60  | 
|                                                                                                          |  |                 |     |  |         | 
|Total                                                                                                     |  |                 | 341 |  |         |  | 335 | 
|                                                                                                          |  |                 |     |  |         | 
|Accruing loans which are contractually past due 90 days
    or more as to
    principal or interest(3)(4) |  |                 |     |  |         |  |     | 
|Ireland                                                                                                   |  |                 | 281 |  |         |  | 206 | 
|United Kingdom                                                                                            |  |                 | 174 |  |         |  | 169 | 
|                                                                                                          |  |                 |     |  |         | 
|Total                                                                                                     |  |                 | 455 |  |         |  | 375 | 
|                                                                                                          |  |                 |     |  |         | 
|Restructured loans not included above                                                                     |  |                 |    |  |         |  |    | 
|                                                                                                          |  |                 |     |  |         | 






|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32,
    39 and IFRS 4.

Table 2


|                                                                                                      |  |                 |     |  |         |  |     |         |  |  |     | 
|----------------------------------------------------------------------------------------------------- |  | --------------- | --- |  | ------- |  | --- | ------- |  |  | --- | 
|                                                                                                      |  | At March 31,    |    
|                                                                                                      |  |                 |    
|                                                                                                      |  | 2004            |     |  | 2003    |  |     | 2002    | 
|                                                                                                      |  | IR GAAP         |     |  | IR GAAP |  |     | IR GAAP | 
|                                                                                                      |  |                 |     |  |         |  |     |         | 
|                                                                                                      |  | (in  millions) |    
|Loans accounted for on a non-accrual basis                                                            |  |                 |     |  |         |  |     |         |  |  |     | 
|Ireland(2)                                                                                            |  |                 | 322 |  |         |  | 268 |         |  |  | 216 | 
|United Kingdom(2)                                                                                     |  |                 | 53  |  |         |  | 51  |         |  |  | 115 | 
|                                                                                                      |  |                 |     |  |         |  |     |         | 
|Total                                                                                                 |  |                 | 375 |  |         |  | 319 |         |  |  | 331 | 
|                                                                                                      |  |                 |     |  |         |  |     |         | 
|Accruing loans which are contractually past due 90 days
    or more as to principal or interest(3)(4) |  |                 |     |  |         |  |     |         |  |  |     | 
|Ireland                                                                                               |  |                 | 216 |  |         |  | 228 |         |  |  | 167 | 
|United Kingdom                                                                                        |  |                 | 132 |  |         |  | 160 |         |  |  | 200 | 
|                                                                                                      |  |                 |     |  |         |  |     |         | 
|Total                                                                                                 |  |                 | 348 |  |         |  | 388 |         |  |  | 367 | 
|                                                                                                      |  |                 |     |  |         |  |     |         | 
|Restructured loans not included above                                                                 |  |                 |    |  |         |  |    |         |  |  |    | 
|                                                                                                      |  |                 |     |  |         |  |     |         | 






|    |                                                                                                                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Includes loans in Ireland and the United Kingdom where interest
    is accrued but provision has been made. The loans on which no
    interest is accrued amounted to
    213 million
    (2005:
    160 million)
    and the provisions thereon amounted to
    119 million
    (2005:
    112 million).            
|   
|(3) | Overdrafts generally have no fixed repayment schedule and are
    not included in this category.                                                                                                                                                                                                                         
|   
|(4) | Includes home mortgage loans in Ireland and the United Kingdom
    (March 31, 2006:
    97.0 million
    in Ireland and
    155.0 million
    in the United Kingdom) which are secured and, typically in the
    UK, where the original loan to value ratio exceeds 75%, benefit
    from mortgage indemnity insurance.



76



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##### Table of Contents





In-Substance


Cross-Border Outstandings






Table 1


|                     |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|-------------------- |  | ----------------------------------- | ----- |  | ------------ |  | ---------- | -------------- |  |  | ----- |  | ---------------- | --------------- | ----- |  |  |  | ---- | 
|                     |  | Banks and                           |       |  |              |  | Commercial |                |  |  |       | 
|                     |  | other                               |       |  | Government   |  |            | and industrial |  |  |       |  |                 
|                     |  | financial                           |       |  | and official |  |            | and other      |  |  |       |  | As percentage of |                
|                     |  | institutions                        |       |  | institutions |  |            | private sector |  |  | Total |  |                  | total assets(2) |      
|                     |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |      
|                     |  | (in  millions, except percentages) |      
|IFRS                 |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|As at March 31, 2006 |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|United Kingdom       |  |                                     | 2,452 |  |              |  |           |                |  |  | 761   |  |                  |                 | 3,213 |  |  |  | 2.0% | 
|IFRS(1)              |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|As at March 31, 2005 |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|United Kingdom       |  |                                     | 2,025 |  |              |  |           |                |  |  | 599   |  |                  |                 | 2,624 |  |  |  | 2.1% | 

Table 2


|                     |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|-------------------- |  | ----------------------------------- | ----- |  | ------------ |  | ---------- | -------------- |  |  | ----- |  | ---------------- | --------------- | ----- |  |  |  | ---- | 
|                     |  | Banks and                           |       |  |              |  | Commercial |                |  |  |       | 
|                     |  | other                               |       |  | Government   |  |            | and industrial |  |  |       |  |                 
|                     |  | financial                           |       |  | and official |  |            | and other      |  |  |       |  | As percentage of |                
|                     |  | institutions                        |       |  | institutions |  |            | private sector |  |  | Total |  |                  | total assets(1) |      
|                     |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |      
|                     |  | (in  millions, except percentages) |      
|IR GAAP              |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|As at March 31, 2004 |  |                                     |       |  |              |  |            |                |  |  |       |  |                  |                 |       |  |  |  |      | 
|United Kingdom       |  |                                     | 1,195 |  |              |  | 7          |                |  |  | 428   |  |                  |                 | 1,630 |  |  |  | 1.5% | 






|    |                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Figures presented in accordance with IFRS excluding IAS 32, 39
    and IFRS 4.                                                                                                                                                                      
|   
|(2) | Assets, consisting of total assets as reported in the
    consolidated balance sheet plus acceptances were
    162.4 billion
    at March 31, 2006 (March 31, 2005 IR GAAP:
    126.5 billion
    and March 31, 2004 IR GAAP:
    106.5 billion).

77



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##### Table of Contents



 




Debt Securities




Table 1


|                                           |  |                 |        |  |      |  |        | 
|------------------------------------------ |  | --------------- | ------ |  | ---- |  | ------ | 
|                                           |  | At March 31,    |       
|                                           |  |                 |       
|                                           |  | 2006            |        |  | 2005 | 
|                                           |  | IFRS            |        |  | IFRS | 
|                                           |  |                 |        |  |      | 
|                                           |  | (in  millions) |       
|Irish Government                           |  |                 | 2,975  |  |      |  | 3,569  | 
|Other European government                  |  |                 | 4,556  |  |      |  | 2,600  | 
|U.S. Treasury and U.S. government agencies |  |                 | 520    |  |      |  |       | 
|Collateralised Mortgage Obligations        |  |                 | 2,659  |  |      |  |       | 
|Corporate bonds                            |  |                 | 13,776 |  |      |  | 15,027 | 
|Other securities                           |  |                 | 7,048  |  |      |  | 1,515  | 
|                                           |  |                 |        |  |      | 
|                                           |  |                 | 31,534 |  |      |  | 22,711 | 
|                                           |  |                 |        |  |      | 

Table 2


|                                           |  |                   |        | 
|------------------------------------------ |  | ----------------- | ------ | 
|                                           |  | At March 31, 2004 |       
|                                           |  | IR GAAP           |       
|                                           |  |                   |       
|                                           |  | (in  millions)   |       
|Irish Government                           |  |                   | 3,416  | 
|Other European government                  |  |                   | 1,590  | 
|U.S. Treasury and U.S. government agencies |  |                   | 49     | 
|Corporate bonds                            |  |                   | 9,446  | 
|Other securities                           |  |                   | 1,175  | 
|                                           |  |                   |       
|                                           |  |                   | 15,676 | 
|                                           |  |                   |       

  


78



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##### Table of Contents





|                                     |  |                                     |       |                  |                   |  |                   |                    |  |  |                |  |  |        |      |  |         |  |       |        |  |  |         |  |  |  |     |  |  |  |      | 
|------------------------------------ |  | ----------------------------------- | ----- | ---------------- | ----------------- |  | ----------------- | ------------------ |  |  | -------------- |  |  | ------ | ---- |  | ------- |  | ----- | ------ |  |  | ------- |  |  |  | --- |  |  |  | ---- | 
|                                     |  | At March 31, 2006                   |      
|                                     |  | IFRS                                |      
|                                     |  |                                     |      
|                                     |  |                                     |       | More than 1 year |                   |  | More than 5 years |                    |  | 
|                                     |  | Less than 1 year                    |       |                  | less than 5 years |  |                   | less than 10 years |  |  | After 10 years | 
|                                     |  |                                     |       |                  |                   |  |                   |                    |  |  |                | 
|                                     |  | Market                              |       |                  | Percent           |  |                   | Market             |  |  | Percent        |  |  | Market |      |  | Percent |  |       | Market |  |  | Percent | 
|                                     |  | Value                               |       |                  | Yield             |  |                   | Value              |  |  | Yield          |  |  | Value  |      |  | Yield   |  |       | Value  |  |  | Yield   | 
|                                     |  |                                     |       |                  |                   |  |                   |                    |  |  |                |  |  |        |      |  |         |  |       |        |  |  |         | 
|                                     |  | (in  millions, except percentages) |      
|Irish government                     |  |                                     |      |                  |                   |  |                  |                    |  |  | 2,071          |  |  |        | 3.58 |  |         |  | 328   |        |  |  | 5.00    |  |  |  |    |  |  |  |     | 
|Other European government            |  |                                     | 364   |                  |                   |  | 3.70              |                    |  |  | 939            |  |  |        | 4.33 |  |         |  | 1,639 |        |  |  | 4.60    |  |  |  |    |  |  |  |     | 
|US Treasury & US government agencies |  |                                     |      |                  |                   |  |                  |                    |  |  | 495            |  |  |        | 4.13 |  |         |  | 25    |        |  |  | 4.47    |  |  |  |    |  |  |  |     | 
|Collateralised Mortgage Obligations  |  |                                     | 162   |                  |                   |  | 5.38              |                    |  |  | 921            |  |  |        | 4.79 |  |         |  | 1,365 |        |  |  | 4.59    |  |  |  | 211 |  |  |  | 2.88 | 
|Corporate bonds                      |  |                                     | 2,836 |                  |                   |  | 3.86              |                    |  |  | 8,533          |  |  |        | 3.87 |  |         |  | 1,834 |        |  |  | 3.69    |  |  |  | 30  |  |  |  | 3.63 | 
|Other                                |  |                                     | 4,800 |                  |                   |  | 3.77              |                    |  |  | 962            |  |  |        | 3.45 |  |         |  | 515   |        |  |  | 4.33    |  |  |  | 150 |  |  |  | 4.68 | 
|                                     |  |                                     |       |                  |                   |  |                   |                    |  |  |                |  |  |        |      |  |         |  |       |        |  |  |         | 
|Total market value                   |  |                                     | 8,162 |                  |                   |  |                   |                    |  |  | 13,921         |  |  |        |      |  |         |  | 5,706 |        |  |  |         |  |  |  | 391 |  |  |  |      | 
|                                     |  |                                     |       |                  |                   |  |                   |                    |  |  |                |  |  |        |      |  |         |  |       |        |  |  |         | 



79



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##### Table of Contents



Loans and Advances to Banks








Table 1


|                                              |  |                 |        |  |      |  |       | 
|--------------------------------------------- |  | --------------- | ------ |  | ---- |  | ----- | 
|                                              |  | At March 31,    |       
|                                              |  |                 |       
|                                              |  | 2006            |        |  | 2005 | 
|                                              |  | IFRS            |        |  | IFRS | 
|                                              |  |                 |        |  |      | 
|                                              |  | (in  millions) |       
|Placings with banks repayable within 30 days: |  |                 |        |  |      |  |       | 
|Domestic                                      |  |                 | 4,854  |  |      |  | 3,393 | 
|Foreign                                       |  |                 | 958    |  |      |  | 356   | 
|                                              |  |                 |        |  |      | 
|Total                                         |  |                 | 5,812  |  |      |  | 3,749 | 
|                                              |  |                 |        |  |      | 
|Placings with banks repayable beyond 30 days: |  |                 |        |  |      |  |       | 
|Domestic                                      |  |                 | 4,674  |  |      |  | 4,492 | 
|Foreign                                       |  |                 | 90     |  |      |  | 106   | 
|                                              |  |                 |        |  |      | 
|Total                                         |  |                 | 4,764  |  |      |  | 4,598 | 
|                                              |  |                 |        |  |      | 
|Total                                         |  |                 | 10,576 |  |      |  | 8,347 | 
|                                              |  |                 |        |  |      | 

Table 2


|                                              |  |                   |       | 
|--------------------------------------------- |  | ----------------- | ----- | 
|                                              |  | At March 31, 2004 |      
|                                              |  | IR GAAP           |      
|                                              |  |                   |      
|                                              |  | (in  millions)   |      
|Placings with banks repayable within 30 days: |  |                   |       | 
|Domestic                                      |  |                   | 1,722 | 
|Foreign                                       |  |                   | 407   | 
|                                              |  |                   |      
|Total                                         |  |                   | 2,129 | 
|                                              |  |                   |      
|Placings with banks repayable beyond 30 days: |  |                   |       | 
|Domestic                                      |  |                   | 4,751 | 
|Foreign                                       |  |                   | 873   | 
|                                              |  |                   |      
|Total                                         |  |                   | 5,624 | 
|                                              |  |                   |      
|Total                                         |  |                   | 7,753 | 
|                                              |  |                   |      

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LIABILITIES


Deposits




Table 1


|                         |  |                 |        |  |      |  |        | 
|------------------------ |  | --------------- | ------ |  | ---- |  | ------ | 
|                         |  | 2006            |        |  | 2005 | 
|                         |  | IFRS            |        |  | IFRS | 
|                         |  |                 |        |  |      | 
|                         |  | (in  millions) |       
|Branches in Ireland      |  |                 | 45,430 |  |      |  | 32,142 | 
|Branches outside Ireland |  |                 | 21,544 |  |      |  | 22,809 | 
|                         |  |                 |        |  |      | 
|Total                    |  |                 | 66,974 |  |      |  | 54,951 | 
|                         |  |                 |        |  |      | 

|                         |  |               |     |  |                 |  |         |               |  |  |                 |  |  |  |        | 
|------------------------ |  | ------------- | --- |  | --------------- |  | ------- | ------------- |  |  | --------------- |  |  |  | ------ | 
|                         |  | Average       |     |  |                 |  | Average |               |  | 
|                         |  | Interest Rate |     |  | 2006            |  |         | Interest Rate |  |  | 2005            | 
|                         |  | during 2006   |     |  | IFRS            |  |         | during 2005   |  |  | IFRS            | 
|                         |  |               |     |  |                 |  |         |               |  |  |                 | 
|                         |  | %             |     |  | (in  millions) |  |         | %             |  |  | (in  millions) | 
|Branches in Ireland      |  |               |     |  |                 |  |         |               |  |  |                 |  |  |  |        | 
|Current accounts:        |  |               |     |  |                 |  |         |               |  |  |                 |  |  |  |        | 
|Interest bearing         |  |               | 1.0 |  |                 |  | 1,096   |               |  |  | 1.1             |  |  |  | 971    | 
|Non-interest bearing     |  |               |    |  |                 |  | 9,613   |               |  |  |                |  |  |  | 8,006  | 
|Deposit accounts:        |  |               |     |  |                 |  |         |               |  |  |                 |  |  |  |        | 
|Demand                   |  |               | 0.6 |  |                 |  | 12,535  |               |  |  | 0.7             |  |  |  | 11,488 | 
|Time                     |  |               | 1.5 |  |                 |  | 14,506  |               |  |  | 0.8             |  |  |  | 11,035 | 
|Other deposits           |  |               | 3.5 |  |                 |  | 7,680   |               |  |  | 6.8             |  |  |  | 642    | 
|                         |  |               |     |  |                 |  |         |               |  |  |                 | 
|                         |  |               |     |  |                 |  | 45,430  |               |  |  |                 |  |  |  | 32,142 | 
|                         |  |               |     |  |                 |  |         |               |  |  |                 | 
|Branches outside Ireland |  |               |     |  |                 |  |         |               |  |  |                 |  |  |  |        | 
|Current accounts:        |  |               |     |  |                 |  |         |               |  |  |                 |  |  |  |        | 
|Interest bearing         |  |               | 4.6 |  |                 |  | 2,499   |               |  |  | 3.5             |  |  |  | 2,553  | 
|Non-interest bearing     |  |               |    |  |                 |  | 965     |               |  |  |                |  |  |  | 880    | 
|Deposit accounts:        |  |               |     |  |                 |  |         |               |  |  |                 |  |  |  |        | 
|Demand                   |  |               | 4.7 |  |                 |  | 6,058   |               |  |  | 4.0             |  |  |  | 7,975  | 
|Time                     |  |               | 5.8 |  |                 |  | 11,612  |               |  |  | 4.5             |  |  |  | 11,397 | 
|Other Deposits           |  |               | 4.5 |  |                 |  | 410     |               |  |  |                |  |  |  | 4      | 
|                         |  |               |     |  |                 |  |         |               |  |  |                 | 
|                         |  |               |     |  |                 |  | 21,544  |               |  |  |                 |  |  |  | 22,809 | 
|                         |  |               |     |  |                 |  |         |               |  |  |                 | 
|Total                    |  |               |     |  |                 |  | 66,974  |               |  |  |                 |  |  |  | 54,951 | 
|                         |  |               |     |  |                 |  |         |               |  |  |                 | 

Table 2


|                         |  |                 |        | 
|------------------------ |  | --------------- | ------ | 
|                         |  | 2004            |       
|                         |  | IR GAAP         |       
|                         |  |                 |       
|                         |  | (in  millions) |       
|Branches in Ireland      |  |                 | 28,082 | 
|Branches outside Ireland |  |                 | 21,424 | 
|                         |  |                 |       
|Total                    |  |                 | 49,506 | 
|                         |  |                 |       

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|                         |  |               |     |  |                 |  |        | 
|------------------------ |  | ------------- | --- |  | --------------- |  | ------ | 
|                         |  | Average       |     |  |                
|                         |  | Interest Rate |     |  | 2004            | 
|                         |  | during 2004   |     |  | IR GAAP         | 
|                         |  |               |     |  |                 | 
|                         |  | %             |     |  | (in  millions) | 
|Branches in Ireland      |  |               |     |  |                 |  |        | 
|Current accounts:        |  |               |     |  |                 |  |        | 
|Interest bearing         |  |               | 1.0 |  |                 |  | 850    | 
|Non-interest bearing     |  |               |    |  |                 |  | 6,656  | 
|Deposit accounts:        |  |               |     |  |                 |  |        | 
|Demand                   |  |               | 1.1 |  |                 |  | 10,936 | 
|Time                     |  |               | 0.8 |  |                 |  | 9,640  | 
|                         |  |               |     |  |                 | 
|                         |  |               |     |  |                 |  | 28,082 | 
|                         |  |               |     |  |                 | 
|Branches outside Ireland |  |               |     |  |                 |  |        | 
|Current accounts:        |  |               |     |  |                 |  |        | 
|Interest bearing         |  |               | 2.6 |  |                 |  | 2,312  | 
|Non-interest bearing     |  |               |    |  |                 |  | 770    | 
|Deposit accounts:        |  |               |     |  |                 |  |        | 
|Demand                   |  |               | 2.8 |  |                 |  | 8,449  | 
|Time                     |  |               | 5.1 |  |                 |  | 9,893  | 
|                         |  |               |     |  |                 | 
|                         |  |               |     |  |                 |  | 21,424 | 
|                         |  |               |     |  |                 | 
|Total                    |  |               |     |  |                 |  | 49,506 | 
|                         |  |               |     |  |                 | 









|                        |  |                   |       |  |        |  |       |        |  |  |         |  |  |  |       | 
|----------------------- |  | ----------------- | ----- |  | ------ |  | ----- | ------ |  |  | ------- |  |  |  | ----- | 
|                        |  | At March 31, 2006 |      
|                        |  | IFRS              |      
|                        |  |                   |      
|                        |  | 0-3               |       |  | 3-6    |  |       | 6-12   |  |  | Over 12 | 
|                        |  | months            |       |  | months |  |       | months |  |  | months  | 
|                        |  |                   |       |  |        |  |       |        |  |  |         | 
|                        |  | (in  millions)   |      
|Time deposits           |  |                   |       |  |        |  |       |        |  |  |         |  |  |  |       | 
|Domestic branches       |  |                   | 3,575 |  |        |  | 388   |        |  |  | 269     |  |  |  | 1,816 | 
|Foreign branches        |  |                   | 4,839 |  |        |  | 656   |        |  |  | 712     |  |  |  | 628   | 
|Certificates of deposit |  |                   |       |  |        |  |       |        |  |  |         |  |  |  |       | 
|Domestic branches       |  |                   | 248   |  |        |  | 535   |        |  |  | 309     |  |  |  | 99    | 
|Foreign branches        |  |                   |      |  |        |  | 108   |        |  |  |        |  |  |  |      | 
|                        |  |                   |       |  |        |  |       |        |  |  |         | 
|                        |  |                   | 8,662 |  |        |  | 1,687 |        |  |  | 1,290   |  |  |  | 2,543 | 
|                        |  |                   |       |  |        |  |       |        |  |  |         | 



Short-Term Borrowings




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Table 1


|                          |             |                                     |        |      |                   |  |        |      | 
|------------------------- | ----------- | ----------------------------------- | ------ | ---- | ----------------- |  | ------ | ---- | 
|                          |             | At March 31, 2006                   |        |      | At March 31, 2005 | 
|                          |             | IFRS                                |        |      | IFRS              | 
|                          |             |                                     |        |      |                   | 
|                          |             | (in  millions, except percentages) |       
|Debt securities in issue  |             |                                     |        |      |                   |  |        |     
|End of year outstandings  |             |                                     | 36,814 |      |                   |  | 21,217 |     
|Highest month-end balance |             |                                     | 36,814 |      |                   |  | 21,217 |     
|Average balance           |             |                                     | 30,193 |      |                   |  | 17,746 |     
|Average rate of interest  |             |                                     |        |      |                   |  |        |     
|                          | At year-end |                                     |        | 4.1% |                   |  |        | 2.5% | 
|                          | During year |                                     |        | 3.7% |                   |  |        | 3.0% | 
|Deposits by banks         |             |                                     |        |      |                   |  |        |     
|End of year outstandings  |             |                                     | 22,385 |      |                   |  | 17,539 |     
|Highest month-end balance |             |                                     | 22,958 |      |                   |  | 19,020 |     
|Average balance           |             |                                     | 19,079 |      |                   |  | 16,370 |     
|Average rate of interest  |             |                                     |        |      |                   |  |        |     
|                          | At year-end |                                     |        | 3.7% |                   |  |        | 3.4% | 
|                          | During year |                                     |        | 2.9% |                   |  |        | 2.2% | 
|Repurchase agreements     |             |                                     |        |      |                   |  |        |     
|End of year outstandings  |             |                                     | 10,167 |      |                   |  | 3,326  |     
|Highest month-end balance |             |                                     | 10,832 |      |                   |  | 4,173  |     
|Average balance           |             |                                     | 7,692  |      |                   |  | 3,757  |     
|Average rate of interest  |             |                                     |        |      |                   |  |        |     
|                          | At year-end |                                     |        | 3.4% |                   |  |        | 2.3% | 
|                          | During year |                                     |        | 3.5% |                   |  |        | 2.2% | 

Table 2


|                          |             |                     |        |      | 
|------------------------- | ----------- | ------------------- | ------ | ---- | 
|                          |             | At March 31, 2004   |       
|                          |             | IR GAAP             |       
|                          |             |                     |       
|                          |             | (in  millions,     |       
|                          |             | except percentages) |       
|Debt securities in issue  |             |                     |        |     
|End of year outstandings  |             |                     | 12,917 |     
|Highest month-end balance |             |                     | 13,022 |     
|Average balance           |             |                     | 11,086 |     
|Average rate of interest  |             |                     |        |     
|                          | At year-end |                     |        | 1.9% | 
|                          | During year |                     |        | 2.1% | 
|Deposits by banks         |             |                     |        |     
|End of year outstandings  |             |                     | 14,068 |     
|Highest month-end balance |             |                     | 14,521 |     
|Average balance           |             |                     | 14,974 |     
|Average rate of interest  |             |                     |        |     
|                          | At year-end |                     |        | 2.7% | 
|                          | During year |                     |        | 2.7% | 



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Item 6     DIRECTORS, SENIOR
MANAGEMENT AND EMPLOYEES





DIRECTORS AND SENIOR MANAGEMENT






|                      |  |     |    |  |               |                                                    |                           |  |      | 
|--------------------- |  | --- | -- |  | ------------- | -------------------------------------------------- | ------------------------- |  | ---- | 
|Name                  |  | Age |    |  | Position held |                                                    | Year appointed a director | 
|                      |  |     |    |  |               |                                                    |                           | 
|Directors             |  |     |    |  |               |                                                    |                           |  |      | 
|Richard Burrows       |  |     | 60 |  |               | Governor                                           |                           |  | 2000 | 
|Denis OBrien         |  |     | 48 |  |               | Deputy Governor                                    |                           |  | 2000 | 
|Brian J Goggin [2004] |  |     | 54 |  |               | Group Chief Executive                              |                           |  | 2000 | 
|John ODonovan [2001] |  |     | 54 |  |               | Group Chief Financial Officer                      |                           |  | 2002 | 
|David J Dilger        |  |     | 49 |  |               | Non-Executive Director                             |                           |  | 2003 | 
|Paul M Haran          |  |     | 49 |  |               | Non-Executive Director                             |                           |  | 2005 | 
|Declan McCourt        |  |     | 60 |  |               | Non-Executive Director                             |                           |  | 2004 | 
|George M Magan        |  |     | 60 |  |               | Non-Executive Director                             |                           |  | 2003 | 
|Caroline A Marland    |  |     | 60 |  |               | Non-Executive Director                             |                           |  | 2001 | 
|Thomas J Moran        |  |     | 53 |  |               | Non-Executive Director                             |                           |  | 2001 | 
|Terence V Neill       |  |     | 61 |  |               | Non-Executive Director                             |                           |  | 2004 | 
|Executive Officers    |  |     |    |  |               |                                                    |                           |  |      | 
|Richie Boucher        |  |     | 48 |  |               | Chief Executive, Retail Financial Services Ireland |                           |  |      | 
|John Clifford         |  |     | 56 |  |               | Group Secretary                                    |                           |  |      | 
|Des Crowley           |  |     | 46 |  |               | Chief Executive, UK Financial Services             |                           |  |      | 
|Kevin Dolan           |  |     | 52 |  |               | Chief Executive, Asset Management Services         |                           |  |      | 
|Denis Donovan         |  |     | 52 |  |               | Chief Executive, Wholesale Financial Services      |                           |  |      | 
|Cyril Dunne           |  |     | 46 |  |               | Group Transformation Director                      |                           |  |      | 
|Michael Grealy        |  |     | 46 |  |               | Head of Group HR                                   |                           |  |      | 
|Ronan Murphy          |  |     | 54 |  |               | Group Chief Risk Officer                           |                           |  |      | 
|Tony Wyatt            |  |     | 57 |  |               | Director, Group Manufacturing                      |                           |  |      | 

Non-Executive Officers


Richard Burrows


Governor






84



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##### Table of Contents



Denis OBrien BA
MBA


Deputy Governor






Executive Directors


Brian J Goggin M Sc (Mgt) FCCA


Group Chief Executive






John ODonovan B Comm FCA


Group Chief Financial Officer






Non-Executive Directors


David Dilger CBE BA
FCA






Paul Haran M Sc, B
Sc






85



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##### Table of Contents



George Magan FCA






Caroline A Marland






Declan McCourt BL MA
MBA






Thomas J Moran B
Sc






Terry Neill MA M Econ
Sc








|   |                                                           
|-- | ----------------------------------------------------------
|() | Senior Independent Director                               
|  
|+  | Chairman of Group Audit Committee                         
|  
|++ | Member of Group Audit Committee                           
|  
|X  | Chairman of Group Remuneration Committee                  
|  
|XX | Member of Group Remuneration Committee                    
|  
|C  | Chairman of Group Nomination & Governance Committee       
|  
|CC | Member of Group Nomination & Governance Committee         
|  
|T* | Chairman, Board of Trustees of the Bank Staff Pension Fund
|  
|T  | Trustee of the Bank Staff Pension Fund                    

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Terms of Office of the Directors







REMUNERATION OF DIRECTORS AND OFFICERS


 


Executive Directors Remuneration Policy




Service contracts




Employees Profit Sharing Plan








87



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##### Table of Contents



Limitations on Stock Issue and Stock Option Plans








Group Sharesave Scheme


  




Long Term Incentive Plan




Group Pension Plans




88



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##### Table of Contents



 


Interest of Management in Certain Transactions




Indebtedness of Directors and Executive Officers


 





CORPORATE GOVERNANCE STATEMENT









The Court of Directors








| |   |                                                                                               
| | - | ----------------------------------------------------------------------------------------------
| |  | the determination of strategy;                                                                
|
| |  | overseeing the management of the business;                                                    
|
| |  | approving material acquisitions, disposals and investment
    decisions; and                  
|
| |  | overseeing corporate governance, succession planning, control
    and risk management systems.



89



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##### Table of Contents



www.bankofireland.ie




Governor and Group Chief Executive












Board Balance and Independence










Appointments to the Court






90



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##### Table of Contents







Information and Professional Development






Performance Evaluation








Re-Election








91



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##### Table of Contents





Remuneration






Accountability and Audit


F-2.


Internal Controls








| |   |                                                                                                                                                                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | a clearly defined organisation structure with defined authority
    limits and reporting mechanisms to higher levels of management
    and to the Court, which support the maintenance of a strong
    control environment;                                                                                                                                            
|
| |  | establishment of Committees with responsibility for core policy
    areas;                                                                                                                                                                                                                                                                                             
|
| |  | a comprehensive set of policies and procedures relating to
    financial controls, asset and liability management (including
    interest, currency and liquidity risk), operational risk and
    credit risk management;                                                                                                                                              
|
| |  | monthly reporting by business units which enables progress
    against business objectives to be monitored, trends to be
    evaluated and variances to be acted upon; and                                                                                                                                                                                             
|
| |  | a semi-annual detailed operational risk assessment by all Group
    businesses with reports to Divisional Management on the
    effectiveness of their risk management systems. Heads of
    business units are required to certify the accuracy of the
    self-assessment and the results arising from this process are
    noted by the Group Risk Policy Committee.





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##### Table of Contents









Audit Committee and Auditors






| |   |                                                                                                                                                                           
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the integrity of the financial statements and any formal
    announcements relating to the Groups financial performance;                                                 
|
| |  | overseeing the relationship between the Group and its external
    auditors including the pre-approval of any services provided by
    the external auditors to the Group;
|
| |  | the review of the Groups internal controls, including
    financial controls;                                                                                            
|
| |  | the effectiveness of the internal audit, compliance and risk
    management functions;                                                                                    
|
| |  | the review of the internal and external audit plans and
    subsequent findings;                                                                                          
|
| |  | the selection of accounting policies;                                                                                                                                     
|
| |  | the review of the auditors report;                                                                                                                                       
|
| |  | obligations under applicable laws and regulations including SOx;
    and                                                                                                  
|
| |  | the review of the effectiveness of the services provided by the
    external auditors and other related matters.                                                          



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Attendance at scheduled meetings during the year ended
March 31, 2006


|                   |                                                       |       |   |             |           |  |            |              |  |              |           |  |  |   |   |  |   |  |   |   |  |  |   |  |  |  |   |  |  |  |   |  | 
|------------------ | ----------------------------------------------------- | ----- | - | ----------- | --------- |  | ---------- | ------------ |  | ------------ | --------- |  |  | - | - |  | - |  | - | - |  |  | - |  |  |  | - |  |  |  | - |  | 
|                   |                                                       |       |   |             |           |  |            |              |  | Group        |           |  | 
|                   |                                                       |       |   |             |           |  |            | Nomination & |  |              | Group     | 
|                   |                                                       |       |   | Group Audit |           |  | Governance |              |  | Remuneration |          
|                   |                                                       | Court |   |             | Committee |  |            | Committee    |  |              | Committee | 
|                   |                                                       |       |   |             |           |  |            |              |  |              |           | 
|Name               |                                                       | A     |   |             | B         |  |            | A            |  |              | B         |  |  | A |   |  | B |  |   | A |  |  | B | 
|                   |                                                       |       |   |             |           |  |            |              |  |              |           |  |  |   |   |  |   |  |   |   |  |  |   | 
|Roy E Bailie       |                                                       |       | 9 |             |           |  | 9          |              |  |              | 6         |  |  |   | 6 |  |   |  |  |   |  |  |  |  |  |  |  |  |  |  |  | 
|Richard Burrows    |                                                       |       | 9 |             |           |  | 9          |              |  |              |          |  |  |   |  |  |   |  | 5 |   |  |  | 5 |  |  |  | 6 |  |  |  | 5 | 
|Laurence G Crowley |                                                       |       | 3 |             |           |  | 3          |              |  |              |          |  |  |   |  |  |   |  | 2 |   |  |  | 2 |  |  |  | 2 |  |  |  | 2 | 
|                   | Retired July 6, 2005                                  |       |   |             |           |  |            |              |  |              |           |  |  |   |   |  |   |  |   |   |  |  |   |  |  |  |   |  |  |  |   |  | 
|David Dilger       |                                                       |       | 9 |             |           |  | 8          |              |  |              | 6         |  |  |   | 5 |  |   |  | 5 |   |  |  | 4 |  |  |  |  |  |  |  |  | 
|Donal Geaney       |                                                       |       | 4 |             |           |  | 3          |              |  |              |          |  |  |   |  |  |   |  |  |   |  |  |  |  |  |  | 3 |  |  |  | 2 | 
|                   | Died October 7, 2005                                  |       |   |             |           |  |            |              |  |              |           |  |  |   |   |  |   |  |   |   |  |  |   |  |  |  |   |  |  |  |   |  | 
|Brian J Goggin     |                                                       |       | 9 |             |           |  | 9          |              |  |              |          |  |  |   |  |  |   |  |  |   |  |  |  |  |  |  |  |  |  |  |  | 
|Paul Haran         |                                                       |       | 9 |             |           |  | 9          |              |  |              |          |  |  |   |  |  |   |  | 5 |   |  |  | 5 |  |  |  |  |  |  |  |  | 
|Mike Hodgkinson    |                                                       |       | 9 |             |           |  | 8          |              |  |              |          |  |  |   |  |  |   |  | 5 |   |  |  | 5 |  |  |  |  |  |  |  |  | 
|George Magan       |                                                       |       | 9 |             |           |  | 9          |              |  |              | 6         |  |  |   | 6 |  |   |  |  |   |  |  |  |  |  |  | 2 |  |  |  | 2 | 
|                   | Appointed to Remuneration Committee November 22, 2005 |       |   |             |           |  |            |              |  |              |           |  |  |   |   |  |   |  |   |   |  |  |   |  |  |  |   |  |  |  |   |  | 
|Caroline Marland   |                                                       |       | 9 |             |           |  | 6          |              |  |              |          |  |  |   |  |  |   |  | 5 |   |  |  | 3 |  |  |  |  |  |  |  |  | 
|Declan McCourt     |                                                       |       | 9 |             |           |  | 8          |              |  |              | 6         |  |  |   | 6 |  |   |  |  |   |  |  |  |  |  |  | 6 |  |  |  | 5 | 
|Tom Moran          |                                                       |       | 9 |             |           |  | 6          |              |  |              | 1         |  |  |   | 1 |  |   |  | 5 |   |  |  | 3 |  |  |  |  |  |  |  |  | 
|                   | Appointed to Audit Committee February 14, 2006        |       |   |             |           |  |            |              |  |              |           |  |  |   |   |  |   |  |   |   |  |  |   |  |  |  |   |  |  |  |   |  | 
|Terry Neill        |                                                       |       | 9 |             |           |  | 9          |              |  |              | 6         |  |  |   | 6 |  |   |  |  |   |  |  |  |  |  |  | 6 |  |  |  | 6 | 
|Ray MacSharry      |                                                       |       | 3 |             |           |  | 3          |              |  |              |          |  |  |   |  |  |   |  |  |   |  |  |  |  |  |  |  |  |  |  |  | 
|                   | Retired July 6, 2005                                  |       |   |             |           |  |            |              |  |              |           |  |  |   |   |  |   |  |   |   |  |  |   |  |  |  |   |  |  |  |   |  | 
|Denis OBrien      |                                                       |       | 9 |             |           |  | 8          |              |  |              |          |  |  |   |  |  |   |  | 4 |   |  |  | 4 |  |  |  | 6 |  |  |  | 6 | 
|John ODonovan     |                                                       |       | 9 |             |           |  | 8          |              |  |              |          |  |  |   |  |  |   |  |  |   |  |  |  |  |  |  |  |  |  |  |  | 
|Mary Redmond       |                                                       |       | 9 |             |           |  | 8          |              |  |              |          |  |  |   |  |  |   |  | 1 |   |  |  | 1 |  |  |  |  |  |  |  |  | 



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Court Sub-Committees


Group Risk Policy Committee


Group Investment Committee




|                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                    |  | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | 
|Group Risk Policy Committee                                                                                                                                                                                             |  | Group Investment Committee                                                                                                                                                                                                         |  | 
|                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                    |  | 
|Ronan Murphy (Chairman)
    Richie Boucher
    John Clifford
    Des Crowley
    Denis Donovan
    Brian J Goggin (Court member)
    Brian Lillis
    Vincent Mulvey
    John ODonovan (Court member)
    Mick Sweeney |  | Brian Goggin (Chairman) (Court member)
    Richie Boucher
    John Clifford
    Des Crowley
    Kevin Dolan
    Denis Donovan
    Cyril Dunne
    Michael Grealy
    Ronan Murphy
    John ODonovan (Court member)
    Tony Wyatt |  | 

New York Stock Exchange (NYSE) Corporate Governance
Requirements


All non-U.S. companies listed on the NYSE are required to
disclose any significant differences between their corporate
governance practices and the requirements of the NYSE applicable
to U.S. companies.













EMPLOYEES




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STOCK OPTIONS








|                        |  |                 |           |  |                 |  |                       | 
|----------------------- |  | --------------- | --------- |  | --------------- |  | --------------------- | 
|                        |  | Number          |           |  |                
|                        |  | Outstanding at  |           |  |                
|Exercise price ( cent) |  | August 18, 2006 |           |  | Exercise Period | 
|                        |  |                 |           |  |                 | 
|4.529                   |  |                 | 235,000   |  |                 |  | June 2000  June 2007 | 
|5.753                   |  |                 | 6,000     |  |                 |  | Nov 2000  Nov 2007   | 
|8.264                   |  |                 | 156,000   |  |                 |  | May 2001  May 2008   | 
|8.933                   |  |                 | 250,000   |  |                 |  | Jul 2002  Jul 2009   | 
|6.96                    |  |                 | 375,934   |  |                 |  | May 2003  May 2010   | 
|9.15                    |  |                 | 123,650   |  |                 |  | Nov 2003  Nov 2010   | 
|11.05                   |  |                 | 448,455   |  |                 |  | May 2004  May 2011   | 
|10.54                   |  |                 | 15,000    |  |                 |  | Nov 2004  Nov 2011   | 
|12.50                   |  |                 | 595,000   |  |                 |  | Jun 2005  Jun 2012   | 
|10.65                   |  |                 | 20,000    |  |                 |  | Dec 2005  Dec 2012   | 
|10.77                   |  |                 | 1,198,000 |  |                 |  | Jun 2006  Jun 2013   | 
|10.54                   |  |                 | 111,000   |  |                 |  | Dec 2006  Dec 2013   | 
|10.76                   |  |                 | 1,569,000 |  |                 |  | Jul 2007  Jul 2014   | 
|12.85                   |  |                 | 1,197,000 |  |                 |  | Jun 2008  Jun 2015   | 
|13.68                   |  |                 | 47,514    |  |                 |  | Jan 2009  Jan 2016   | 
|14.00                   |  |                 | 1,325,400 |  |                 |  | Jul 2009  Jul 2016   | 



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|             |  |                       |         | 
|------------ |  | --------------------- | ------- | 
|             |  | UNITS OF 0.64        |        
|             |  | OF ORDINARY STOCK     |        
|             |  | As at August 18, 2006 |        
|             |  | Beneficial            |        
|             |  |                       |        
|DIRECTORS    |  |                       |         | 
|R Burrows    |  |                       | 100,377 | 
|D J Dilger   |  |                       | 2,998   | 
|B J Goggin   |  |                       | 426,406 | 
|P M Haran    |  |                       | 2,407   | 
|G M Magan    |  |                       | 1,898   | 
|C A Marland  |  |                       | 2,179   | 
|J D McCourt  |  |                       | 25,674  | 
|T J Moran    |  |                       | 2,194   | 
|T V Neill    |  |                       | 94,300  | 
|D OBrien    |  |                       | 352,389 | 
|J ODonovan  |  |                       | 74,351  | 
|SECRETARY    |  |                       |         | 
|J B Clifford |  |                       | 125,502 | 





Limitations on Stock Issue and Stock Option Plans











|       |                                                  
|------ | -------------------------------------------------
|Item 7 | MAJOR STOCKHOLDERS AND RELATED PARTY TRANSACTIONS




CONTROL OF REGISTRANT




|                                          |  |            |            |  |   |  |     | 
|----------------------------------------- |  | ---------- | ---------- |  | - |  | --- | 
|NAME                                      |  | Units held |            |  | % | 
|                                          |  |            |            |  |   | 
|Bank of Ireland Asset Management Limited* |  |            | 65,857,490 |  |   |  | 6.8 | 






|  |                                                                                                                                                                                                               
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | This stockholding is not beneficially owned but is held on
    behalf of a range of clients, none of whom hold, so far as the
    Directors have been notified, more than 3% of the Issued
    Ordinary Stock.




RELATED PARTY TRANSACTIONS




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DESCRIPTION OF U.S. STOCKHOLDERS







RELATIONS WITH STOCKHOLDERS


Relations with Stockholders


www.bankofireland.ie








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Item 8     FINANCIAL
INFORMATION


F-1 F-134.





DIVIDEND POLICY




|                                    |  |                 |       |  |                   |  |       | 
|----------------------------------- |  | --------------- | ----- |  | ----------------- |  | ----- | 
|                                    |  | Dividends       |       |  | Translated into   | 
|                                    |  | per unit of     |       |  | U.S. cents        | 
|                                    |  | Ordinary Stock  |       |  | per Unit of       | 
|Dividend Payment Date               |  | (in euro cents) |       |  | Ordinary Stock(1) | 
|                                    |  |                 |       |  |                   | 
|Financial Year ended March 31, 2006 |  |                 |       |  |                   |  |       | 
|July 28, 2006                       |  |                 | 34.30 |  |                   |  | 43.73 | 
|January 11, 2006                    |  |                 | 18.20 |  |                   |  | 22.09 | 
|Financial Year ended March 31, 2005 |  |                 |       |  |                   |  |       | 
|July 15, 2005                       |  |                 | 29.00 |  |                   |  | 34.91 | 
|January 5, 2005                     |  |                 | 16.60 |  |                   |  | 22.06 | 
|Financial Year ended March 31, 2004 |  |                 |       |  |                   |  |       | 
|July 16, 2004                       |  |                 | 26.60 |  |                   |  | 33.08 | 
|January 6, 2004                     |  |                 | 14.80 |  |                   |  | 18.90 | 
|Financial Year ended March 31, 2003 |  |                 |       |  |                   |  |       | 
|July 18, 2003                       |  |                 | 23.80 |  |                   |  | 26.75 | 
|January 7, 2003                     |  |                 | 13.20 |  |                   |  | 13.75 | 
|Financial Year ended March 31, 2002 |  |                 |       |  |                   |  |       | 
|July 19, 2002                       |  |                 | 21.40 |  |                   |  | 21.73 | 
|January 8, 2002                     |  |                 | 11.60 |  |                   |  | 10.35 | 






|    |                                                            
|--- | -----------------------------------------------------------
|(1) | Translated at the Noon Buying Rate on the dates of payment.






LEGAL PROCEEDINGS







PROSPECTIVE ACCOUNTING CHANGES/ IMPACT OF NEW ACCOUNTING
POLICIES


IFRS








99



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US GAAP


SFAS 154  Accounting Changes and Error
Correction  a replacement of APB Opinion No. 20
and FASB Statement No. 3




SFAS 123R  Accounting for Stock-Based
Compensation




SFAS 155  Accounting for Certain Hybrid
Financial Instruments




FSP FAS 115-1  The Meaning of
Other-Than-Temporary Impairment and its Application to Certain
Investments


115-1 03-1 115-1 115-1


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EITF 04-5
Determining whether a General Partner, or General Partners as a
Group, Controls a Limited Partnership or Similar Entity when the
Limited Partners Have Certain Rights


04-5 04-5





Item 9     THE OFFER AND
LISTING





NATURE OF THE TRADING MARKET


    














|                              |  |                |       |  |              |  |       |      |  |  |       |  |  |  |       | 
|----------------------------- |  | -------------- | ----- |  | ------------ |  | ----- | ---- |  |  | ----- |  |  |  | ----- | 
|                              |  | Ordinary Stock |       |  | ADSs         | 
|                              |  |                |       |  |              | 
|                              |  | High           |       |  | Low          |  |       | High |  |  | Low   | 
|                              |  |                |       |  |              |  |       |      |  |  |       | 
|                              |  | (in euro)      |       |  | (in dollars) | 
|Financial Year ended March 31 |  |                |       |  |              |  |       |      |  |  |       |  |  |  |       | 
|2002                          |  |                | 12.61 |  |              |  | 7.85  |      |  |  | 44.15 |  |  |  | 28.31 | 
|2003                          |  |                | 14.05 |  |              |  | 8.70  |      |  |  | 52.40 |  |  |  | 34.70 | 
|2004                          |  |                | 11.85 |  |              |  | 9.80  |      |  |  | 60.20 |  |  |  | 42.60 | 
|2005                          |  |                | 13.24 |  |              |  | 9.70  |      |  |  | 70.60 |  |  |  | 47.12 | 
|2006                          |  |                | 15.50 |  |              |  | 11.65 |      |  |  | 76.00 |  |  |  | 60.10 | 

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|                         |  |                |       |  |              |  |       |      |  |  |       |  |  |  |       | 
|------------------------ |  | -------------- | ----- |  | ------------ |  | ----- | ---- |  |  | ----- |  |  |  | ----- | 
|                         |  | Ordinary Stock |       |  | ADSs         | 
|                         |  |                |       |  |              | 
|                         |  | High           |       |  | Low          |  |       | High |  |  | Low   | 
|                         |  |                |       |  |              |  |       |      |  |  |       | 
|                         |  | (in euro)      |       |  | (in dollars) | 
|Financial year 2004/2005 |  |                |       |  |              |  |       |      |  |  |       |  |  |  |       | 
|First quarter            |  |                | 10.98 |  |              |  | 9.70  |      |  |  | 53.84 |  |  |  | 47.12 | 
|Second quarter           |  |                | 11.41 |  |              |  | 10.41 |      |  |  | 56.10 |  |  |  | 51.60 | 
|Third quarter            |  |                | 12.25 |  |              |  | 10.64 |      |  |  | 66.79 |  |  |  | 53.59 | 
|Fourth quarter           |  |                | 13.24 |  |              |  | 12.01 |      |  |  | 70.60 |  |  |  | 62.95 | 
|                        
|Financial year 2005/2006 |  |                |       |  |              |  |       |      |  |  |       |  |  |  |       | 
|First quarter            |  |                | 13.42 |  |              |  | 11.65 |      |  |  | 65.57 |  |  |  | 60.63 | 
|Second quarter           |  |                | 13.89 |  |              |  | 12.61 |      |  |  | 68.72 |  |  |  | 62.51 | 
|Third quarter            |  |                | 13.80 |  |              |  | 12.35 |      |  |  | 66.31 |  |  |  | 60.10 | 
|Fourth quarter           |  |                | 15.50 |  |              |  | 13.50 |      |  |  | 76.00 |  |  |  | 65.62 | 
|                        
|Financial year 2006/2007 |  |                |       |  |              |  |       |      |  |  |       |  |  |  |       | 
|First quarter            |  |                | 15.35 |  |              |  | 13.10 |      |  |  | 75.94 |  |  |  | 66.38 | 
|                        
|Month ended              |  |                |       |  |              |  |       |      |  |  |       |  |  |  |       | 
|March 2006               |  |                | 15.50 |  |              |  | 14.75 |      |  |  | 76.00 |  |  |  | 70.65 | 
|April 2006               |  |                | 15.35 |  |              |  | 14.45 |      |  |  | 75.94 |  |  |  | 72.28 | 
|May 2006                 |  |                | 14.85 |  |              |  | 13.48 |      |  |  | 75.85 |  |  |  | 71.80 | 
|June 2006                |  |                | 14.29 |  |              |  | 13.10 |      |  |  | 74.33 |  |  |  | 66.38 | 
|July 2006                |  |                | 14.13 |  |              |  | 13.15 |      |  |  | 73.00 |  |  |  | 67.19 | 
|August 2006              |  |                | 14.97 |  |              |  | 13.96 |      |  |  | 77.66 |  |  |  | 72.15 | 






Item 10     ADDITIONAL
INFORMATION





CHARTER AND BYE-LAWS




|   |                                 
|-- | --------------------------------
|1. | Objects and Registration Details



| |                                                                                                                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Governor and Company of the Bank of Ireland (the
    Bank) is registered in Ireland with the Companies
    Office under
    No. C-1. The
    corporation was established pursuant to a Charter granted by
    King George III on foot of an Act of the Irish Parliament
    passed in 1781/82. The Charter was granted in 1783.                                                
|
| | The corporations objects and purposes were set out
    originally in the Charter and have been amended by legislation
    (in 1872 and 1929) and by resolutions passed by the stockholders
    meeting in General Court in 1972 and 1995. The principal objects
    of the corporation are to carry on the business of banking and
    to undertake all types of financial services.



|   |          
|-- | ---------
|2. | Directors



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Any Director interested in a contract must declare his/her
    interest at a meeting of the Directors at which the question of
    entering into such contract first arises. The Bye-Laws also
    require that a Director may not vote in respect of any proposal
    in which he or any person connected with him has a material
    interest of making this determination. Interests in stock,
    shares, debenture or other securities of the Group are
    disregarded for the purpose. A Director cannot be counted in a
    quorum of the Court of Directors or of the meeting of a

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| |                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | committee in relation to any resolution on which he is debarred
    from voting. The prohibition on voting in respect of contracts
    in which Directors are interested is disapplied in respect of
    proposals:



| |     |                                                                                                                                                                                                                                                                     
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) | where a Director is given security or indemnified in respect of
    money lent or obligations incurred by him for the benefit of the
    Group;                                                                                                                     
|
| | (b) | giving security or indemnifying a third party in respect of a
    debt or obligation of the Group;                                                                                                                                                                  
|
| | (c) | relating to an offer of debentures or securities of the Group in
    which a Director is interested as an underwriter;                                                                                                                                              
|
| | (d) | regarding any proposal concerning any other company in which a
    Director is interested, directly or indirectly, provided that
    the director does not hold or is not beneficially interested in
    more than 1% of any class of share capital of that company;
|
| | (e) | regarding any pension or retirement fund or stock option scheme
    from which a Director might benefit and which has been approved
    by the Revenue Commissioners; and                                                                                           
|
| | (f) | regarding any proposal to purchase and maintain insurance
    against any liability incurred by Directors and Officers of the
    Group.                                                                                                                            



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The remuneration of Directors is fixed from time to time by the
    stockholders in General Court. Such remuneration is divided
    among them as the Directors determine. Such remuneration shall
    be independent of any remuneration to which a Director may be
    entitled in respect of any other office or appointment within
    the Group. In the absence of an independent quorum, the
    Directors are not competent to vote compensation to themselves
    or any members of their body. The Governor and Deputy Governor,
    elected from time to time by the Directors, are office holders
    and are remunerated on terms established by the Directors.
|
| | Directors may exercise all the borrowing powers of the Group and
    may give security in connection therewith. These borrowing
    powers may be amended or restricted only by the stockholders in
    General Court.                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| | There is no age limit requirement in the Bye-laws that specifies
    when a Director must retire. However the Directors have adopted
    as a guideline that the normal retirement age for non-executive
    directors is age 68.                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| | All Directors must hold at least 1,000 units of Ordinary Stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | In accordance with The Combined Code on Corporate
    Governance, adopted by the Irish Stock Exchange and the
    London Stock Exchange, all Directors retire by rotation every
    three years and, if eligible, may offer themselves for
    re-election subject to satisfactory performance evaluation.                                                                                                                                                                                                                                                                                                                                                               



|   |                                           
|-- | ------------------------------------------
|3. | Rights and Restrictions Attaching to Stock



|    |               
|--- | --------------
|(a) | Ordinary Stock



| |                
| | ---------------
| | Dividend Rights



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Under Irish law, and under the Bye-Laws of the Group, dividends
    are payable on the Ordinary Stock of the Bank only out of
    profits available for distribution. Holders of the Ordinary
    Stock of the Bank are entitled to receive such dividends as may
    be declared by the stockholders in General Court, provided that
    the dividend cannot exceed the amount recommended by the
    Directors. The Bank may pay stockholders such interim dividends
    as appear to the Directors to be justified by the profits of the
    Bank. Any dividend which has remained unclaimed for
    12 years from the date of its declaration may be forfeited
    and cease to remain owing by the Bank.



| |              
| | -------------
| | Voting Rights



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Voting at any General Court is by a show of hands unless a poll
    is properly demanded. On a show of hands every stockholder who
    is present in person or by proxy has one vote regardless of the
    number of units of stock held by him. On a poll, every
    stockholder who is present in person or by proxy has one vote
    for every unit of Ordinary Stock of
    0.64 each. A
    poll may be demanded by: the chairman of the meeting, orby at

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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | least nine members of the Group present in person or by proxy
    and entitled to vote on a poll. The necessary quorum for a
    General Court is 10 persons present in person or by proxy and
    entitled to vote.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | All business is considered to be special business if it is
    transacted at an Extraordinary General Court as is all business
    transacted at an Annual General Court other than the declaration
    of a dividend, the consideration of the accounts, the balance
    sheet and reports of the Directors and Auditors, the election of
    Directors in the place of those retiring, the re-appointment of
    the retiring auditors, and the determination of the remuneration
    of the auditors, all of which is deemed ordinary business.
    Special business is dealt with by way of a special resolution,
    which must be passed by not less than three fourths of the votes
    cast by such members as being entitled so to do, vote in person
    or, where proxies are allowed, by proxy at a General Court at
    which not less than 21 days notice specifying the
    intention to propose a resolution as a special resolution has
    been duly given. Ordinary business is dealt with by way of an
    ordinary resolution which requires a simple majority of the
    votes cast by the members voting in person or by proxy at a
    General Court. Where an equal number of votes has been cast on
    any resolution the chairman of the meeting is entitled to a
    second or casting vote.



| |                   
| | ------------------
| | Liquidation Rights



| |                                                                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In the event of any surplus arising on the occasion of the
    liquidation of the Bank the Ordinary Stockholders would be
    entitled to a share in that surplus pro ratato their
    holdings of Ordinary Stock.



|    |                 
|--- | ----------------
|(b) | Preference Stock



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The capital of the Bank is divided into Ordinary Stock and
    Non-Cumulative Dollar Preference Stock, Non-Cumulative Sterling
    Preference Stock and Non-Cumulative Euro Preference Stock. At
    August 18, 2006 there were in issue 1,876,090 units of
    Non-Cumulative Sterling Preference Stock and 3,026,598 units of
    Non-Cumulative Euro Preference Stock. The holders of
    Non-Cumulative Sterling and Euro Preference Stock are entitled
    to a fixed annual dividend in accordance with the terms and
    conditions relating to the issue of the Preference Stock. Any
    dividend which has remained unclaimed for 12 years from the
    date of its declaration may be forfeited and cease to remain
    owing by the Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | The Non-Cumulative Sterling Preference Stock and the
    Non-Cumulative Euro Preference Stock ranks pari passu inter
    seand the right to a fixed dividend is in priority to the
    dividend rights of Ordinary Stock in the capital of the Bank. On
    a winding up or other return of capital by the Bank the
    Non-Cumulative Sterling Preference Stockholders and the
    Non-Cumulative Euro Preference Stockholders are entitled to
    receive, out of the surplus assets available for distribution to
    the Banks members, an amount equal to the amount paid up
    on their Preference Stock including any Preference Dividend
    outstanding at the date of the commencement of the winding-up or
    other return of capital. Otherwise the Preference Stockholders
    are not entitled to any further or other right of participation
    in the assets of the Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | Bye-Law 7 enables the Directors to issue and allot new
    Preference Stock (the 2005 Preference Stock) which
    can be either redeemable or non-redeemable, and can be
    denominated in US Dollars, in euro or in sterling. Any
    Preference Stock issued under Bye-Law 7 will rank equivalently
    to the existing euro and Sterling Preference Stock as regards
    entitlements to dividends. On March 2, 2005, BOI Capital
    Funding (No. 1) LP, a limited partnership organised under
    the law of England and Wales, issued Preferred Securities to a
    value of
    600,000,000,
    which qualify as an Alternative Capital Instrument
    (ACI) for the purposes of the capital adequacy
    requirements of the Financial Regulator and thus contribute to
    the capital base of the Bank. On January 27, 2006, BOI
    Capital Funding (No. 2) LP, a limited partnership organised
    under the Law of England and Wales, issued Preferred Securities
    to a value of US$800,000,000. On February 3, 2006, BOI
    Capital Funding (No. 3) LP, a limited partnership organised
    under the law of England and Wales, issued Preferred Securities
    to a value of US$400,000,000. Bye-Law 7 permits the substitution
    of all the outstanding Preferred Securities in the event of the
    occurrence of a Trigger Event. A Trigger Event will occur when
    the capital adequacy requirements of the Financial Regulator
    have been, or are expected to be, breached.

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|   |                          
|-- | -------------------------
|4. | Variation of Class Rights



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The rights attached to the Ordinary Stock of the Group may be
    varied or abrogated, either while the Group is a going concern
    or during or in contemplation of a winding-up, with the sanction
    of a resolution passed at a class meeting of the holders of the
    Ordinary Stock. Similarly, the rights, privileges, limitations
    or restrictions attached to the Preference Stock may be varied,
    altered or abrogated, either while the Group is a going concern
    or during or in contemplation of a winding-up, with the written
    consent of the holders of not less than 75% of such class of
    stock or with the sanction of a resolution passed at a class
    meeting at which the holders of 75% in nominal value of those in
    attendance vote in favour of the resolution.



|   |                            
|-- | ---------------------------
|5. | Convening of General Courts



| |                                                                                                                                                                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Annual General Courts and a Court called for the passing of a
    special resolution must be called by 21 days notice
    in writing. The notice must specify the place and date of the
    meeting and, in the case of special business, must give the
    general nature of that business. Admission to General Courts is
    limited to members of the Bank and validly appointed proxies.



|   |                                           
|-- | ------------------------------------------
|6. | Limitation on the Rights to Own Securities



| |                                                                                                                                                                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Neither the Charter nor the Bye-Laws impose restrictions on the
    right of non-resident or foreign shareholders to own securities
    in the Group. See, however, Exchange Control and Other
    Limitations Affecting Security Holders on page 107, for
    restrictions imposed in the context of EU and UN sanctions.



|   |                                  
|-- | ---------------------------------
|7. | Limitation on a Change of Control



| |                
| | ---------------
| | Not applicable.



|   |                              
|-- | -----------------------------
|8. | Disclosure of Stock Ownership



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Under Irish company law where a person acquires an interest in
    shares in a public limited company (and the Group is considered
    to be a public limited company for these purposes) or ceases to
    be interested in such shares, he has an obligation to notify the
    company of the interests he has, or had, in its shares. The
    initial notifiable threshold is 5% of the aggregate nominal
    value of the issued share capital carrying rights to vote in all
    circumstances at a general meeting of the company. In addition,
    if the shares of the company are quoted on the Irish Stock
    Exchange and a person becomes aware that he has acquired, or has
    ceased to have an interest in, shares in a quoted company, he
    must notify the exchange when his interest in such shares
    exceeds or falls below, as the case may be, certain reference
    levels: 10%, 25%, 50% and 75%.                                                                                                                                                                                                                                                                                                                                              
|
| | Under the Bye-Laws of the Group any member may be requested to
    declare by statutory declaration whether he is beneficially
    entitled to Ordinary Stock of which he is the registered owner
    and, if not, to disclose the person or persons for whom he holds
    such Ordinary Stock in trust. Such a declaration must be made
    within 14 days of service of the notice. Failure to respond
    to the notice in the prescribed period entitles the Directors to
    serve a disenfranchisement notice to such member with the
    consequence that the member may not attend or vote, either
    personally or by proxy, at any General Court of the Group or
    exercise any other rights conferred by membership in respect of
    his holding Ordinary Stock (the Default Stock). In
    addition, where the Default Stock amounts to more than 5% of the
    Ordinary Stock then in issue of the Group then the
    disenfranchisement notice can state that no dividend will be
    payable on the Default Stock, and that no transfer of the
    Default Stock will be registered by, or on behalf of, the Group.
    A disenfranchisement notice may continue in effect for as long
    as the default in respect of which it was issued continues.



|   |                                                                                        
|-- | ---------------------------------------------------------------------------------------
|9. | Employee Share Schemes, Long Term Incentive Plan and
    Executive Stock Option Schemes



| |                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Stockholders of the Bank have from time to time approved (and
    renewed) executive stock option schemes and more broadly based
    employee profit participation plans.                                                      
|
| | The Group Sharesave Scheme (1999), established under similar
    enabling legislation in both Ireland and the United Kingdom,
    enables participating employees, who enter into a savings
    related contract, to be granted

105



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| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | an option to acquire units of Ordinary Stock on completion of
    that contract at a price related to the market price which
    prevailed at the time of the granting of the option. Eligible
    employees, whose remuneration is subject to Irish or UK income
    tax, may be awarded options over stock the exercise price of
    which may be set at a discount of up to 25% of the prevailing
    stock market price. Participants must take out an approved
    savings contract and may contribute from
    12 to
    320 per month.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| | The Long Term Incentive Plan (2004) is restricted to senior
    executive officers and focuses on the Groups Total
    Shareholder Return (TSR) relative to a group of 17
    leading European financial services businesses. The TSR takes
    into account both the Groups stock price performance and
    dividend payments to stockholders. The Long Term Incentive Plan
    is median-based and competitive relative to other leading
    financial services businesses in Europe, and provides incentives
    for eligible management that are aligned with stockholders
    interests, and is designed to ensure that the Group continues to
    recruit, retain and motivate high quality executives. Under the
    Plan, senior executives may receive conditional awards of stock
    worth up to one times salary each year (or up to 1.5 times
    salary in the case of the Group Chief Executive) but these
    awards will vest in full only if the Groups total
    shareholder return over three years is ranked first or second
    relative to a group of 17 leading European financial services
    businesses. No awards will vest if the Groups total
    shareholder return is below the median relative to those
    companies or if the average Return on Equity (ROE)
    is less than 20% per annum.
|
| | The Group Executive Stock Option Scheme (2004) focuses on
    underlying earnings per share (underlying EPS)
    growth. The scheme, which is median based and competitive in
    relation to other leading financial services businesses in
    Europe, also provides incentives for eligible management that
    are aligned with stockholders interests and to ensure that
    the Group can continue to recruit, retain and motivate high
    quality executives. Under the scheme, executives may be granted
    options to purchase stock up to one times salary each
    year. These options will only be exercisable if the Groups
    underlying EPS growth over three years exceeds the increase in
    the Consumer Price Index by at least 5% per annum compound.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | The Group Staff Stock Issue scheme (2006) was established
    under profit sharing legislation and approved by the Revenue
    Commissioners in Ireland. All Irish-resident employees
    (including executive directors of the Bank and of participating
    companies) are eligible to participate in the scheme. The scheme
    allows the Group to make an award of free stock up to a maximum
    of 7.5% of the salary of eligible employees in any one year, up
    to a ceiling of
    12,700. Subject
    to being held in trust for a period of three years, the stock is
    passed to the employee tax free and is thereby a very tax
    efficient mechanism for creating employee stock ownership. The
    amount of stock allocated by the directors reflects the
    Groups performance but cannot exceed 5% of the
    consolidated profits of the Group in any year. The Stock
    Incentive Plan (2003) approved by the Inland Revenue of the
    United Kingdom, makes similar provisions for employees of the
    Bank or any participating company resident in the United Kingdom.                                                                                                                                                                                                                               
|
| | The Restricted Stock Plan (2006) makes provision for the
    award, to US-based employees of the Bank or participating
    subsidiaries, of Ordinary Stock of the Bank. To be eligible,
    employees must have been in continuous employment with the Bank
    or a participating subsidiary for a period of at least
    12 months. As in the case of the Staff Stock Issue (2006),
    stock awarded under the Restricted Stock Plan must be held for
    at least three years, and the maximum award cannot exceed 7.5%
    of the base salary in any year. Awards will be made at the
    discretion of the directors, by reference to the profitability
    of the Bank, but may not exceed, other similar schemes, when
    cumulated with 5% of the consolidated profits of the Bank.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | All of the above stock issue and stock option schemes are
    subject to a range of flow rate controls approved by the
    stockholders and which conform to current institutional investor
    guidelines.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              



|    |                                             
|--- | --------------------------------------------
|10. | Directors and Officers Liability Insurance



| |                                                                                                                                                                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Irish company law permits companies to purchase and maintain
    insurance against directors and officers liability.
    The Bye-Laws of the Group enable the Group to purchase such
    liability insurance and make it clear that directors are
    entitled to vote and be counted in the quorum in respect of any
    resolution concerning the purchase of such insurance.

106



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EXCHANGE CONTROLS AND OTHER LIMITATIONS AFFECTING SECURITY
HOLDERS







TAXATION


While the summary discussion relates
to material matters relevant to the tax laws of the United
States and Ireland, all holders should consult their own tax
advisors as to the Irish, U.S. or any other tax consequences of
the purchase, ownership and disposition of an interest in
Ordinary Stock or ADSs including the effect of any foreign state
or local tax laws as they apply to their particular
circumstances.










Irish Taxation




107



---



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http://www.revenue.ie/publications/list/qiawa.htm


Gain on Disposition.


Irish Stamp Duty:






United States Federal Income Taxation


Dividends.




108



---



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Gain on Disposition.


Back-up Withholding and Information Reporting.




United States and Irish Estate and Gift Taxation




inter
vivos


109



---



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DOCUMENTS AVAILABLE THROUGH THE SEC


www.sec.gov





Item 11     QUANTITATIVE AND
QUALITATIVE DISCLOSURES ABOUT MARKET RISK





ANALYSIS OF FINANCIAL CONDITION


Capital Resources




|                                         |  |                 |        |      |  |  |       | 
|---------------------------------------- |  | --------------- | ------ | ---- |  |  | ----- | 
|                                         |  | At March 31,   
|                                         |  |                
|                                         |  | 2006            |        | 2005
|                                         |  |                 |        |     
|                                         |  | (in  millions)
|Stockholders funds                      |  |                 |        |      |  |  |       | 
|Equity (including other equity reserves) |  |                 | 5,263  |      |  |  | 4,212 | 
|Non-cumulative preference stock          |  |                 | 65     |      |  |  | 65    | 
|Minority interests                       |  |                 | 45     |      |  |  | 135   | 
|Undated capital notes                    |  |                 | 2,880  |      |  |  | 1,980 | 
|Dated capital notes                      |  |                 | 3,613  |      |  |  | 2,106 | 
|                                         |  |                 |        |      |  |  |       | 
|Total capital resources                  |  |                 | 11,866 |      |  |  | 8,498 | 
|                                         |  |                 |        |      |  |  |       | 

          


   


110



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|                 |  |             |               | 
|---------------- |  | ----------- | ------------- | 
|                 |  | Senior Debt |              
|                 |  |             |              
|Moodys           |  |             | Aa3 (stable)  | 
|Standard & Poors |  |             | A+ (positive) | 
|Fitch            |  |             | AA- (stable)  | 



Capital Adequacy Requirements








111



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Capital Adequacy Data




|                                                   |  |           |        |   |          |  |        |  
|-------------------------------------------------- |  | --------- | ------ | - | -------- |  | ------ | -
|                                                   |  | March 31, |        |   | April 1, | 
|                                                   |  | 2006      |        |   | 2005     | 
|                                                   |  |           |        |   |          | 
|                                                   |  | m        |        |   | m       | 
|Adjusted Capital Base                              |  |           |        |   |          |  |        |  
|Share Capital                                      |  |           | 656    |   |          |  | 656    |  
|Eligible reserves                                  |  |           | 3,941  |   |          |  | 3,073  |  
|Minority Interests                                 |  |           | 45     |   |          |  | 135    |  
|Non-Cumulative Preference stock                    |  |           | 65     |   |          |  | 65     |  
|Preferred securities                               |  |           | 2,516  |   |          |  | 1,686  |  
|Bristol & West preference shares                   |  |           | 72     |   |          |  |       |  
|Regulatory adjustments (net)                       |  |           | 39     |   |          |  | 405    |  
|                                                   |  |           |        |   |          | 
|Total Tier 1                                       |  |           | 7,334  |   |          |  | 6,020  |  
|                                                   |  |           |        |   |          | 
|Revaluation reserves  property and other reserves |  |           | 690    |   |          |  | 454    |  
|IBNYR/ Impairment provisions                       |  |           | 127    |   |          |  | 137    |  
|Subordinated Perpetual debt capital                |  |           | 431    |   |          |  | 294    |  
|Subordinated Dated debt capital                    |  |           | 3,405  |   |          |  | 2,106  |  
|                                                   |  |           |        |   |          | 
|Total Tier 2                                       |  |           | 4,653  |   |          |  | 2,991  |  
|Supervisory Deductions                             |  |           | (870   | ) |          |  | (768   | )
|                                                   |  |           |        |   |          | 
|Total Capital                                      |  |           | 11,117 |   |          |  | 8,243  |  
|                                                   |  |           |        |   |          | 
|Risk Weighted Assets                               |  |           |        |   |          |  |        |  
|Banking book                                       |  |           | 93,398 |   |          |  | 73,251 |  
|Trading book                                       |  |           | 4,112  |   |          |  | 2,635  |  
|                                                   |  |           |        |   |          | 
|Total                                              |  |           | 97,510 |   |          |  | 75,886 |  
|                                                   |  |           |        |   |          | 
|Capital Ratios                                     |  |           |        |   |          |  |        |  
|Tier 1 capital                                     |  |           | 7.5%   |   |          |  | 7.9%   |  
|                                                   |  |           |        |   |          | 
|Total capital                                      |  |           | 11.4%  |   |          |  | 10.9%  |  
|                                                   |  |           |        |   |          | 





     





   


112



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  






| |   |                                                                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Align capital management to the Groups strategy.                                                                                                                       
|
| |  | Meet the requirements of equity and debt investors.                                                                                                                     
|
| |  | Achieve the optimal mix of capital to meet the Groups
    regulatory requirements and rating ambitions.                                                                
|
| |  | Manage capital in aggregate and at business level, ensuring that
    capital is only invested in businesses meeting or exceeding the
    Groups hurdle rates of return.






RISK MANAGEMENT AND CONTROL






Risk Management Approach










113



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Group Risk Governance Framework










| |   |                                                                                    
| | - | -----------------------------------------------------------------------------------
| |  | Group Credit Committee  all large credit transactions                             
|
| |  | Group Asset and Liability Committee  market and
    liquidity risk                
|
| |  | Group Operational Risk Committee  operational risk                                
|
| |  | Group Regulatory Risk and Compliance Committee 
    regulatory risk and compliance
|
| |  | Portfolio Review Group  composition of the
    Groups loan portfolio             
|
| |  | Risk Measurement Group  credit risk measurement and
    risk model validation     



CREDIT RISK




Lending Authorities








114



---



##### Table of Contents



Credit Policy






Country/ Bank Limits






Rating Methodologies














Review




115



---



##### Table of Contents







Impairment Provisions
























116



---



##### Table of Contents





MARKET RISK








TRADING BOOK
















117



---



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|                          |  |           |       |  |           |  |       | 
|------------------------- |  | --------- | ----- |  | --------- |  | ----- | 
|                          |  | 2005/2006 |       |  | 2004/2005 | 
|                          |  |           |       |  |           | 
|End Year Trading Book VaR |  |           | 1.3m |  |           |  | 1.1m | 
|Average Trading Book VaR  |  |           | 2.1m |  |           |  | 2.0m | 
|Lowest Trading Book VaR   |  |           | 1.3m |  |           |  | 1.0m | 
|Highest Trading Book VaR  |  |           | 4.1m |  |           |  | 3.6m | 

 


BANKING BOOK












  


F-63)


DERIVATIVES








118



---



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Policy














Collateral Agreements






Nature of Derivatives Instruments




Structural Foreign Exchange




119



---



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|                             |  |                |       |  |                |  |       | 
|---------------------------- |  | -------------- | ----- |  | -------------- |  | ----- | 
|                             |  | March 31, 2006 |       |  | March 31, 2005 | 
|                             |  |                |       |  |                | 
|                             |  | m             |       |  | m             | 
|GBP                          |  |                | 3,373 |  |                |  | 2,908 | 
|USD                          |  |                | 264   |  |                |  | 248   | 
|                             |  |                |       |  |                | 
|Total structural FX position |  |                | 3,637 |  |                |  | 3,156 | 
|                             |  |                |       |  |                | 

 


Liquidity Risk










OPERATIONAL RISK




Operational Risk Governance






Operational Risk Management Approach




120



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| |   |                                                                                                                                                                 
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Formulation and dissemination of the Group Operational Risk
    Policy                                                                                          
|
| |  | The establishment of organisational structures for the
    oversight, monitoring and management of operational risk
    throughout the Group                    
|
| |  | Embedding the Operational Risk Management Process in all
    business and support units throughout the Group                                                    
|
| |  | Creating awareness throughout the Group of the need to manage
    operational risk and training of relevant staff in the
    Operational Risk Management Process

The Operational Risk Management Process




The Operational Risk Management Process





Operational Risk Reporting








Regulatory Risk & Compliance






121



---



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Item 12 DESCRIPTION OF SECURITIES OTHER THAN EQUITY
SECURITIES




122



---



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PART II







|        |                                              
|------- | ---------------------------------------------
|Item 13 | DEFAULTS, DIVIDEND ARREARAGES & DELINQUENCIES








|        |                                                                               
|------- | ------------------------------------------------------------------------------
|Item 14 | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS
    & USE OF PROCEEDS






Item 15     CONTROLS AND
PROCEDURES


Evaluation of Disclosure Controls and Procedures




F-121 F-123)








Item 16







|         |                                 
|-------- | --------------------------------
|Item 16A | Audit Committee Financial Expert








|         |               
|-------- | --------------
|Item 16B | Code of Ethics



123



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|         |                                       
|-------- | --------------------------------------
|Item 16C | Principal Accountant Fees and Services

F-36).







|         |                                                           
|-------- | ----------------------------------------------------------
|Item 16D | Exemptions from the Listing Standards for Audit Committees








|         |                                                                           
|-------- | --------------------------------------------------------------------------
|Item 16E | Purchases of Equity Securities by the Issuer and Affiliated
    Purchasers



124



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PART III







|        |                     
|------- | --------------------
|Item 17 | FINANCIAL STATEMENTS








|        |                     
|------- | --------------------
|Item 18 | FINANCIAL STATEMENTS



|                                                        |                                                         |      |     |      | 
|------------------------------------------------------- | ------------------------------------------------------- | ---- | --- | ---- | 
|                                                        |                                                         | Page |    
|                                                        |                                                         |      |    
|Bank of Ireland Group Financial Statements:             |                                                         |      |     |     
|Statement of Directors Responsibilities                |                                                         |      | F-2 |     
|Report of Independent Registered Public Accounting Firm |                                                         |      | F-3 |     
|Consolidated Income Statement                           |                                                         |      | F-4 |     
|Consolidated Balance Sheet                              |                                                         |      | F-5 |     
|Statement of Recognized Income and Expense              |                                                         |      | F-6 |     
|Consolidated Cash Flow Statement                        |                                                         |      | F-7 |     
|Index to Accounting Policies                            |                                                         |      | F-9 |     
|                                                        | Index to Notes to the Consolidated Financial Statements |      |     | F-29 | 






|        |         
|------- | --------
|Item 19 | EXHIBITS

|     |  |   |  |                                                                                                                                                                                                                                                                                 
|---- |  | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.1  |  |  |  | Charter & Acts (incorporated by reference to Exhibit 1.1 of
    the annual report on Form 20-F of The Governor and Company of
    the Bank of Ireland for the financial year ended March 31, 2001,
    File No. 1-14452).                                                       
|1.2  |  |  |  | Bye-Laws (incorporated by reference to Exhibit 1.1 of the annual
    report on Form 20-F of The Governor and Company of the Bank of
    Ireland for the financial year ended March 31, 2001, File No.
    1-14452).                                                             
|4.1  |  |  |  | Rules of the Bank of Ireland Group Stock Options
    Scheme  2006.                                                                                                                                                                                                             
|4.2  |  |  |  | Rules of the Bank of Ireland Group Long Term Performance Stock
    Plan (incorporated by reference to Exhibit 4 of the annual
    report on Form 20-F of The Governor and Company of the Bank of
    Ireland for the financial year ended March 31, 2001, File No.
    1-14452).
|4.3  |  |  |  | Rules of the Bank of Ireland Group Long Term Incentive Plan 2004
    and Executive Stock Option Scheme 2004.                                                                                                                                                                    
|4.4  |  |  |  | Rules of the Bank of Ireland Restricted Stock Options Plan 2006.                                                                                                                                                                                                                
|8    |  |  |  | List of significant subsidiaries  incorporated by
    reference to page 20 of this Form 20-F.                                                                                                                                                                                  
|12.1 |  |  |  | Certification by the Chief Executive Officer as required by
    Section 302 of Sarbanes-Oxley Act of 2002.                                                                                                                                                                      
|12.2 |  |  |  | Certification by the Chief Financial Officer as required by
    Section 302 of Sarbanes-Oxley Act of 2002.                                                                                                                                                                      
|13.1 |  |  |  | Certification by the Chief Executive Officer as required by
    Section 906 of Sarbanes-Oxley Act of 2002.                                                                                                                                                                      
|13.2 |  |  |  | Certification by the Chief Financial Officer as required by
    Section 906 of Sarbanes-Oxley Act of 2002.                                                                                                                                                                      

125



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BANK OF IRELAND GROUP


INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


Year Ended March 31, 2006


|                                                            |  |      |      | 
|----------------------------------------------------------- |  | ---- | ---- | 
|                                                            |  | Page |     
|                                                            |  |      |     
|Statement of Directors
    Responsibilities                |  |      | F-2  | 
|Report of Independent Registered Public
    Accounting Firm |  |      | F-3  | 
|Consolidated Income Statement                               |  |      | F-4  | 
|Consolidated Balance Sheet                                  |  |      | F-5  | 
|Statement of Recognised Income and
    Expense              |  |      | F-6  | 
|Consolidated Cash Flow Statement                            |  |      | F-7  | 
|Index to Accounting policies                                |  |      | F-9  | 
|Index to Notes to the Consolidated
    Financial Statements |  |      | F-29 | 

F-1



---



##### Table of Contents



BANK OF IRELAND GROUP





STATEMENT OF DIRECTORS RESPONSIBILITIES








| |   |                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------
| |  | select suitable accounting policies and then apply them
    consistently;                                                                          
|
| |  | make judgements and estimates that are reasonable and prudent;                                                                                     
|
| |  | state that the financial statements comply with IFRS.                                                                                              
|
| |  | prepare the financial statements on the going concern basis
    unless it is inappropriate to presume that the Group will
    continue in business.







F-2



---



##### Table of Contents



BANK OF IRELAND GROUP





REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Court of Directors and members of the Governor and
Company of the Bank of Ireland:












PricewaterhouseCoopers


Chartered Accountants and Registered Auditors


Dublin, Ireland


September 11, 2006


F-3



---



##### Table of Contents



BANK OF IRELAND GROUP





CONSOLIDATED INCOME STATEMENT


|                                                              |  |       |        |            |       |  |        |       |  |  |        |  
|------------------------------------------------------------- |  | ----- | ------ | ---------- | ----- |  | ------ | ----- |  |  | ------ | -
|                                                              |  |       |        | Year Ended |      
|                                                              |  |       |        | March 31,  |      
|                                                              |  |       |        |            |      
|                                                              |  |       |        | 2006       |       |  | 2005   |      
|                                                              |  |       |        | Group      |       |  | Group  |      
|                                                              |  | Notes |        |            | Total |  |        | Total | 
|                                                              |  |       |        |            |       |  |        |       | 
|                                                              |  |       |        | m         |       |  | m     |      
|Interest Income                                               |  |       | 3      |            |       |  | 5,954  |       |  |  | 4,263  |  
|Interest Expense                                              |  |       | 3      |            |       |  | (3,647 | )     |  |  | (2,332 | )
|                                                              |  |       |        |            |       |  |        |       | 
|Net Interest Income                                           |  |       |        |            |       |  | 2,307  |       |  |  | 1,931  |  
|Insurance net premium income                                  |  |       |        |            |       |  | 1,298  |       |  |  | 1,791  |  
|Fees and commissions income                                   |  |       |        |            |       |  | 912    |       |  |  | 1,163  |  
|Fees and commissions expense                                  |  |       |        |            |       |  | (170   | )     |  |  | (263   | )
|Net trading income                                            |  |       | 4      |            |       |  | 30     |       |  |  | 66     |  
|Life assurance investment income and gains                    |  |       |        |            |       |  | 625    |       |  |  | 695    |  
|Other operating income                                        |  |       | 5      |            |       |  | 165    |       |  |  | 138    |  
|Profit on disposal of business activity                       |  |       | 6      |            |       |  | 176    |       |  |  | 11     |  
|                                                              |  |       |        |            |       |  |        |       | 
|Total Operating Income                                        |  |       |        |            |       |  | 5,343  |       |  |  | 5,532  |  
|Increase in insurance contract liabilities and claims paid    |  |       |        |            |       |  | (1,666 | )     |  |  | (2,222 | )
|                                                              |  |       |        |            |       |  |        |       | 
|Total Operating Income, net of Insurance Claims               |  |       |        |            |       |  | 3,677  |       |  |  | 3,310  |  
|Total Operating Expenses                                      |  |       | 7      |            |       |  | (2,020 | )     |  |  | (2,051 | )
|                                                              |  |       |        |            |       |  |        |       | 
|Operating Profit before Impairment Losses                     |  |       |        |            |       |  | 1,657  |       |  |  | 1,259  |  
|Impairment losses                                             |  |       | 17, 18 |            |       |  | (103   | )     |  |  | 21     |  
|                                                              |  |       |        |            |       |  |        |       | 
|Operating Profit                                              |  |       |        |            |       |  | 1,554  |       |  |  | 1,280  |  
|Share of profit of associated undertakings and joint ventures |  |       |        |            |       |  | 45     |       |  |  | 30     |  
|                                                              |  |       |        |            |       |  |        |       | 
|Profit before Taxation                                        |  |       |        |            |       |  | 1,599  |       |  |  | 1,310  |  
|Taxation                                                      |  |       | 11     |            |       |  | (303   | )     |  |  | (256   | )
|                                                              |  |       |        |            |       |  |        |       | 
|Profit for the Period                                         |  |       |        |            |       |  | 1,296  |       |  |  | 1,054  |  
|                                                              |  |       |        |            |       |  |        |       | 
|Attributable to minority interests                            |  |       |        |            |       |  | (9     | )     |  |  | (1     | )
|Attributable to stockholders                                  |  |       |        |            |       |  | 1,305  |       |  |  | 1,055  |  
|                                                              |  |       |        |            |       |  |        |       | 
|Profit for the Period                                         |  |       |        |            |       |  | 1,296  |       |  |  | 1,054  |  
|                                                              |  |       |        |            |       |  |        |       | 
|Earnings per unit of
    0.64 ordinary
    stock             |  |       | 12     |            |       |  | 136.4c |       |  |  | 111.1c |  
|                                                              |  |       |        |            |       |  |        |       | 
|Diluted earnings per unit of
    0.64 ordinary
    stock     |  |       | 12     |            |       |  | 135.4c |       |  |  | 110.2c |  
|                                                              |  |       |        |            |       |  |        |       | 

The notes on pages F-10 to F-134


Form an integral part of these consolidated financial
statements


F-4



---



##### Table of Contents



BANK OF IRELAND GROUP





CONSOLIDATED BALANCE SHEET


|                                                                |  |       |    |              |      |  |         |      |  |  |         |  
|--------------------------------------------------------------- |  | ----- | -- | ------------ | ---- |  | ------- | ---- |  |  | ------- | -
|                                                                |  |       |    | At March 31, |     
|                                                                |  |       |    |              |     
|                                                                |  | Notes |    |              | 2006 |  |         | 2005 | 
|                                                                |  |       |    |              |      |  |         |      | 
|                                                                |  |       |    | m           |      |  | m      |     
|ASSETS                                                          |  |       |    |              |      |  |         |      |  |  |         |  
|Cash and balances at central banks                              |  |       |    |              |      |  | 1,899   |      |  |  | 1,613   |  
|Items in the course of collection from other banks              |  |       |    |              |      |  | 930     |      |  |  | 560     |  
|Central government and other eligible bills                     |  |       | 13 |              |      |  | 8       |      |  |  | 1,607   |  
|Trading securities                                              |  |       | 14 |              |      |  | 620     |      |  |  |        |  
|Derivative financial instruments                                |  |       | 15 |              |      |  | 2,085   |      |  |  |        |  
|Other financial assets at fair value through P/ L               |  |       | 14 |              |      |  | 10,580  |      |  |  |        |  
|Loans and advances to banks                                     |  |       | 16 |              |      |  | 10,576  |      |  |  | 8,347   |  
|Available-for-sale financial assets                             |  |       | 18 |              |      |  | 28,205  |      |  |  |        |  
|Loans and advances to customers                                 |  |       | 17 |              |      |  | 101,246 |      |  |  | 79,836  |  
|Debt securities                                                 |  |       | 19 |              |      |  |        |      |  |  | 22,711  |  
|Equity shares                                                   |  |       |    |              |      |  |        |      |  |  | 5,716   |  
|Interest in associated undertakings                             |  |       | 20 |              |      |  | 21      |      |  |  | 17      |  
|Interest in joint ventures                                      |  |       | 21 |              |      |  | 75      |      |  |  | 61      |  
|Intangible assets  Goodwill                                    |  |       | 22 |              |      |  | 375     |      |  |  | 219     |  
|Intangible assets  Other                                       |  |       | 22 |              |      |  | 590     |      |  |  | 573     |  
|Investment property                                             |  |       |    |              |      |  | 807     |      |  |  | 503     |  
|Property, plant & equipment                                     |  |       | 23 |              |      |  | 860     |      |  |  | 720     |  
|Deferred tax asset                                              |  |       | 31 |              |      |  | 30      |      |  |  | 99      |  
|Other assets                                                    |  |       | 24 |              |      |  | 3,447   |      |  |  | 5,198   |  
|                                                                |  |       |    |              |      |  |         |      | 
|Total assets                                                    |  |       |    |              |      |  | 162,354 |      |  |  | 127,780 |  
|                                                                |  |       |    |              |      |  |         |      | 
|EQUITY AND LIABILITIES                                          |  |       |    |              |      |  |         |      |  |  |         |  
|Deposits by banks                                               |  |       | 25 |              |      |  | 32,312  |      |  |  | 20,865  |  
|Customer accounts                                               |  |       | 26 |              |      |  | 61,710  |      |  |  | 60,185  |  
|Items in the course of transmission to other banks              |  |       |    |              |      |  | 284     |      |  |  | 230     |  
|Derivative financial instruments                                |  |       | 15 |              |      |  | 1,647   |      |  |  |        |  
|Liabilities to customers under investment contracts             |  |       |    |              |      |  | 6,650   |      |  |  |        |  
|Debt securities in issue                                        |  |       | 27 |              |      |  | 36,814  |      |  |  | 21,217  |  
|Life assurance liabilities attributable to policyholders        |  |       |    |              |      |  |        |      |  |  | 8,713   |  
|Insurance contract liabilities                                  |  |       |    |              |      |  | 5,192   |      |  |  |        |  
|Other liabilities                                               |  |       | 29 |              |      |  | 4,711   |      |  |  | 6,757   |  
|Deferred tax liabilities                                        |  |       | 31 |              |      |  | 207     |      |  |  | 212     |  
|Provisions                                                      |  |       | 30 |              |      |  | 153     |      |  |  | 179     |  
|Retirement benefit obligations                                  |  |       | 35 |              |      |  | 808     |      |  |  | 924     |  
|Subordinated liabilities                                        |  |       | 28 |              |      |  | 6,493   |      |  |  | 4,086   |  
|                                                                |  |       |    |              |      |  |         |      | 
|Total liabilities                                               |  |       |    |              |      |  | 156,981 |      |  |  | 123,368 |  
|Equity                                                          |  |       |    |              |      |  |         |      |  |  |         |  
|Share capital                                                   |  |       | 38 |              |      |  | 663     |      |  |  | 663     |  
|Share premium account                                           |  |       | 39 |              |      |  | 767     |      |  |  | 767     |  
|Retained profit                                                 |  |       | 39 |              |      |  | 3,330   |      |  |  | 2,424   |  
|Other reserves                                                  |  |       | 39 |              |      |  | 803     |      |  |  | 629     |  
|Own shares held for the benefit of life assurance policyholders |  |       |    |              |      |  | (235    | )    |  |  | (206    | )
|                                                                |  |       |    |              |      |  |         |      | 
|Stockholders equity                                            |  |       |    |              |      |  | 5,328   |      |  |  | 4,277   |  
|Minority interests                                              |  |       | 37 |              |      |  | 45      |      |  |  | 135     |  
|                                                                |  |       |    |              |      |  |         |      | 
|Total equity                                                    |  |       |    |              |      |  | 5,373   |      |  |  | 4,412   |  
|                                                                |  |       |    |              |      |  |         |      | 
|Total equity and liabilities                                    |  |       |    |              |      |  | 162,354 |      |  |  | 127,780 |  
|                                                                |  |       |    |              |      |  |         |      | 

The notes on pages
F-10 to
F-134


Form an integral part of these consolidated financial
statements


F-5



---



##### Table of Contents



BANK OF IRELAND GROUP





STATEMENT OF RECOGNISED INCOME AND EXPENSE


|                                                              |  |      |       |   |      |  |       |  
|------------------------------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | -
|                                                              |  | 2006 |       |   | 2005 | 
|                                                              |  |      |       |   |      | 
|                                                              |  | m   |       |   | m   | 
|Net gain on property revaluation                              |  |      | 187   |   |      |  | 43    |  
|Net change in cash flow hedge reserve                         |  |      | (7    | ) |      |  |      |  
|Net change in Available for Sale reserve                      |  |      | (104  | ) |      |  |      |  
|Net actuarial gains/losses in defined benefit pension schemes |  |      | 113   |   |      |  | (386  | )
|Foreign exchange translations                                 |  |      | (17   | ) |      |  | (108  | )
|                                                              |  |      |       |   |      | 
|Income/expense recognised in equity                           |  |      | 172   |   |      |  | (451  | )
|Profit for the period                                         |  |      | 1,296 |   |      |  | 1,054 |  
|                                                              |  |      |       |   |      | 
|Total recognised income/expense for the year                  |  |      | 1,468 |   |      |  | 603   |  
|                                                              |  |      |       |   |      | 
|Attributable to:                                              |  |      |       |   |      |  |       |  
|Equity holders of the parent                                  |  |      | 1,477 |   |      |  | 604   |  
|Minority interests                                            |  |      | (9    | ) |      |  | (1    | )
|                                                              |  |      |       |   |      | 
|                                                              |  |      | 1,468 |   |      |  | 603   |  
|                                                              |  |      |       |   |      | 
|Implementation of IAS32/39 and IFRS 4 as at April 1, 2005     |  |      | 28    |   |      |  |      |  
|                                                              |  |      |       |   |      | 
|Attributable to:                                              |  |      |       |   |      |  |       |  
|Equity holders of the parent                                  |  |      | 28    |   |      |  |      |  
|Minority interests                                            |  |      |      |   |      |  |      |  
|                                                              |  |      |       |   |      | 
|                                                              |  |      | 28    |   |      |  |      |  
|                                                              |  |      |       |   |      | 

The notes on
pages F-10 to
F-134


Form an integral part of these consolidated financial
statements


F-6



---



##### Table of Contents



BANK OF IRELAND GROUP





CASH FLOW STATEMENT


|                                                                       |  |           |         |   |           |  |         |  
|---------------------------------------------------------------------- |  | --------- | ------- | - | --------- |  | ------- | -
|                                                                       |  | 31-3-2006 |         |   | 31-3-2005 | 
|                                                                       |  |           |         |   |           | 
|                                                                       |  | m        |         |   | m        | 
|Cash flows from operating activities                                   |  |           |         |   |           |  |         |  
|Operating Profit                                                       |  |           | 1,554   |   |           |  | 1,280   |  
|Profit on disposal of business activity                                |  |           | (176    | ) |           |  | (11     | )
|Profit on disposal of property                                         |  |           | (4      | ) |           |  | (8      | )
|Depreciation and amortisation                                          |  |           | 166     |   |           |  | 177     |  
|Decrease/increase in prepayments and accrued income                    |  |           | 61      |   |           |  | (188    | )
|Increase in accruals and deferred income                               |  |           | 132     |   |           |  | 160     |  
|Provisions for impairment of loans and advances                        |  |           | 103     |   |           |  | (21     | )
|Loans and advances written off net of recoveries                       |  |           | (64     | ) |           |  | (123    | )
|Revaluation of investment property                                     |  |           | (53     | ) |           |  |        |  
|Profit on disposal of investment property                              |  |           | (49     | ) |           |  |        |  
|Interest on subordinated liabilities and other capital
    instruments |  |           | 256     |   |           |  | 225     |  
|Profit on disposal of available for sale financial instruments         |  |           | (4      | ) |           |  | (2      | )
|Charge for share based payments                                        |  |           | 11      |   |           |  | 11      |  
|Amortisation of premiums and discounts                                 |  |           | (98     | ) |           |  | 15      |  
|Amortisation of debt issue expenses                                    |  |           | 2       |   |           |  | 2       |  
|                                                                       |  |           |         |   |           | 
|                                                                       |  |           | 1,837   |   |           |  | 1,517   |  
|                                                                       |  |           |         |   |           | 
|Net increase in deposits by banks                                      |  |           | 11,484  |   |           |  | 3,135   |  
|Net increase in customer accounts                                      |  |           | 1,852   |   |           |  | 6,844   |  
|Net increase in loans and advances to customers                        |  |           | (21,925 | ) |           |  | (13,471 | )
|Net (increase)/ decrease in loans and advances to banks                |  |           | (1,574  | ) |           |  | 714     |  
|Net increase in non investment debt & equity securities                |  |           | 499     |   |           |  | (1,594  | )
|Net increase in derivative financial instruments                       |  |           | (340    | ) |           |  |        |  
|Net (increase)/decrease in assets at fair value through P/L            |  |           | (2,442  | ) |           |  |        |  
|Net increase/ decrease in items in course of collection                |  |           | (319    | ) |           |  | 19      |  
|Net increase in debt securities in issue                               |  |           | 15,604  |   |           |  | 7,541   |  
|Net increase in other assets                                           |  |           | (571    | ) |           |  | (86     | )
|Increase in other liabilities                                          |  |           | 2,763   |   |           |  | 475     |  
|Effect of exchange translation and other adjustments                   |  |           | (20     | ) |           |  | 306     |  
|                                                                       |  |           |         |   |           | 
|Net cash inflow from operating assets and liabilities                  |  |           | 5,011   |   |           |  | 3,883   |  
|                                                                       |  |           |         |   |           | 
|Net cash inflow from operating activities before taxation              |  |           | 6,848   |   |           |  | 5,400   |  
|Taxation paid                                                          |  |           | (230    | ) |           |  | (155    | )
|                                                                       |  |           |         |   |           | 
|Net cash inflow from operating activities                              |  |           | 6,618   |   |           |  | 5,245   |  
|Investing activities (note a)                                          |  |           | (7,391  | ) |           |  | (4,037  | )
|Financing activities (note b)                                          |  |           | 1,739   |   |           |  | (213    | )
|                                                                       |  |           |         |   |           | 
|Increase in cash and cash equivalents                                  |  |           | 966     |   |           |  | 995     |  
|Opening cash and cash equivalents                                      |  |           | 5,217   |   |           |  | 4,242   |  
|Effect of exchange translation adjustments                             |  |           | (21     | ) |           |  | (20     | )
|                                                                       |  |           |         |   |           | 
|Closing cash and cash equivalents                                      |  |           | 6,162   |   |           |  | 5,217   |  
|                                                                       |  |           |         |   |           | 

The notes on pages F-10 to F-134


Form an integral part of these consolidated financial
statements


F-7



---



##### Table of Contents



BANK OF IRELAND GROUP


CASH FLOW
STATEMENT     (Continued)


|                                                              |  |           |        |   |           |  |        |  
|------------------------------------------------------------- |  | --------- | ------ | - | --------- |  | ------ | -
|                                                              |  | 31-3-2006 |        |   | 31-3-2005 | 
|                                                              |  |           |        |   |           | 
|                                                              |  | m        |        |   | m        | 
|(a)   Investing activities                                    |  |           |        |   |           |  |        |  
|Net increase in financial investments                         |  |           | (7,217 | ) |           |  | (3,992 | )
|Additions to tangible fixed assets                            |  |           | (50    | ) |           |  | (187   | )
|Disposal of tangible fixed assets                             |  |           | 60     |   |           |  | 55     |  
|Additions to intangible fixed assets                          |  |           | (106   | ) |           |  |       |  
|Disposal of intangible fixed assets                           |  |           | 8      |   |           |  |       |  
|Purchase of investment property                               |  |           | (353   | ) |           |  |       |  
|Disposal of investment property                               |  |           | 151    |   |           |  |       |  
|Disposal of business activity                                 |  |           | 227    |   |           |  |       |  
|Acquisition of Group undertaking                              |  |           | (120   | ) |           |  |       |  
|Dividends received from joint ventures                        |  |           | 25     |   |           |  | 14     |  
|Decrease/(increase) in investments in associated undertakings |  |           | 1      |   |           |  | (3     | )
|Increase in investment in Iridian                             |  |           | (18    | ) |           |  | (33    | )
|Net cash balances of Group undertakings acquired              |  |           | 1      |   |           |  | 142    |  
|Sale of EuroConex Technologies Limited                        |  |           |       |   |           |  | 35     |  
|Sale of UK IFA Balances                                       |  |           |       |   |           |  | 28     |  
|Cash balances of UK IFA businesses disposed                   |  |           |       |   |           |  | (24    | )
|Acquisition of Burdale                                        |  |           |       |   |           |  | (72    | )
|                                                              |  |           |        |   |           | 
|Cash flows from investing activities                          |  |           | (7,391 | ) |           |  | (4,037 | )
|                                                              |  |           |        |   |           | 
|(b)   Financing activities                                    |  |           |        |   |           |  |        |  
|Re issue of Treasury stock                                    |  |           | 36     |   |           |  | 7      |  
|Issue of new subordinated liabilities                         |  |           | 2,414  |   |           |  | 587    |  
|Repayment of subordinated liabilities                         |  |           |       |   |           |  | (145   | )
|Interest paid on subordinated liabilities                     |  |           | (233   | ) |           |  | (223   | )
|Equity dividends paid                                         |  |           | (459   | ) |           |  | (417   | )
|Dividends on other equity interests                           |  |           | (13    | ) |           |  | (8     | )
|Dividends paid to minority interests                          |  |           | (6     | ) |           |  | (14    | )
|                                                              |  |           |        |   |           | 
|Cash flows from financing activities                          |  |           | 1,739  |   |           |  | (213   | )
|                                                              |  |           |        |   |           | 

The notes on pages F-10 to F-134


Form an integral part of these consolidated financial
statements


F-8



---



##### Table of Contents



BANK OF IRELAND GROUP





INDEX TO ACCOUNTING POLICIES


|  |  |                                                                   |  |      |      | 
|- |  | ----------------------------------------------------------------- |  | ---- | ---- | 
|  |  |                                                                   |  | Page |     
|  |  |                                                                   |  |      |     
|A |  | Basis of preparation                                              |  |      | F-10 | 
|B |  | Group accounts (including subsidiaries, associates, etc.)         |  |      | F-11 | 
|C |  | Foreign currency translation                                      |  |      | F-12 | 
|D |  | Interest income and expense                                       |  |      | F-12 | 
|E |  | Fee and commission income                                         |  |      | F-13 | 
|F |  | Leases                                                            |  |      | F-13 | 
|G |  | Financial assets                                                  |  |      | F-13 | 
|H |  | Financial liabilities                                             |  |      | F-15 | 
|I |  | Sale and repurchase agreements and lending of securities          |  |      | F-15 | 
|J |  | Issued debt and equity securities                                 |  |      | F-15 | 
|K |  | Derivative financial instruments and hedge accounting             |  |      | F-16 | 
|L |  | Impairment of financial assets                                    |  |      | F-17 | 
|M |  | Property, plant and equipment                                     |  |      | F-19 | 
|N |  | Intangible assets                                                 |  |      | F-19 | 
|O |  | Provisions                                                        |  |      | F-20 | 
|P |  | Employee benefits                                                 |  |      | F-20 | 
|Q |  | Income taxes                                                      |  |      | F-21 | 
|R |  | Cash and cash equivalents                                         |  |      | F-21 | 
|S |  | Share capital and treasury stock                                  |  |      | F-22 | 
|T |  | Comparatives                                                      |  |      | F-22 | 
|U |  | Life assurance operations                                         |  |      | F-22 | 
|V |  | Offsetting financial instruments                                  |  |      | F-23 | 
|W |  | Collateral                                                        |  |      | F-23 | 
|X |  | Financial guarantees                                              |  |      | F-23 | 
|Y |  | Accounting policies applying to March 2005                        |  |      | F-23 | 
|Z |  | Prospective accounting changes/ impact of new Accounting Policies |  |      | F-25 | 

F-9



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES


Accounting Policies






|  |                     
|- | --------------------
|A | Basis of Preparation



F-23 F-25


F-27 F-28.


Transition to IFRS








| |   |                                                                                                                                                                                                                                                                                                         
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Business combinations: The Group has availed of the exemption
    and has not restated the group accounts for any acquisitions or
    business combinations that took place prior to April 1,
    2004.                                                                                                 
|
| |  | Fair value or revaluation as deemed cost: The Group has availed
    of the exemption to treat fair value as deemed cost at
    transition on April 1, 2004 in respect of adaptations to
    the properties existing at that date.                                                                       
|
| |  | Employee benefits: The Group has elected to recognise all
    cumulative actuarial gains and losses on defined benefit pension
    schemes at April 1, 2004.                                                                                                                                            
|
| |  | Cumulative translation differences: The Group has availed of the
    exemption to deem all accumulated balances arising from
    translation of foreign subsidiaries to be nil on transition to
    IFRS at April 1, 2004.                                                                              
|
| |  | Share-based payment transactions: The Group has availed of the
    exemption only to apply IFRS2 to share based payments granted on
    or after November 7, 2002 that have not vested before
    January 1, 2005.                                                                                      
|
| |  | Comparative restatement: The Group has availed of the option not
    to apply IAS32 Financial Instruments: Disclosure and
    Presentation, IAS39 Financial Instruments: Recognition and
    Measurement and IFRS4 Insurance Contracts to the comparative
    figures for the year ended March 31, 2005.

F-10



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




|  |               
|- | --------------
|B | Group Accounts



|    |             
|--- | ------------
|(1) | Subsidiaries













|    |                              
|--- | -----------------------------
|(2) | Associates and Joint Ventures













|    |                   
|--- | ------------------
|(3) | Minority Interests



F-11



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)






|  |                             
|- | ----------------------------
|C | Foreign Currency Translation









| |   |                                                                                                                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Assets and liabilities for each balance sheet presented are
    translated at the closing rate at the date of that balance sheet;                                                                                                                                                                                              
|
| |  | Income and expenses for each income statement are translated at
    average exchange rates (unless this average is not a reasonable
    approximation of the cumulative effect of the rates prevailing
    on the transaction dates, in which case income and expenses are
    translated at the date of the transactions); and
|
| |  | All resulting exchange differences are recognised as a separate
    component of equity.                                                                                                                                                                                                                                       







|        |  |                |        |  |                |  |        |         |  |  |         |  |  |  |        | 
|------- |  | -------------- | ------ |  | -------------- |  | ------ | ------- |  |  | ------- |  |  |  | ------ | 
|        |  | March 31, 2006 |        |  | March 31, 2005 | 
|        |  |                |        |  |                | 
|        |  | Average        |        |  | Closing        |  |        | Average |  |  | Closing | 
|        |  |                |        |  |                |  |        |         |  |  |         | 
|/U.S.$ |  |                | 1.2126 |  |                |  | 1.2104 |         |  |  | 1.2647  |  |  |  | 1.2964 | 
|/Stg£  |  |                | 0.6826 |  |                |  | 0.6964 |         |  |  | 0.6834  |  |  |  | 0.6885 | 



|  |                            
|- | ---------------------------
|D | Interest Income and Expense





F-12



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)








|  |                           
|- | --------------------------
|E | Fees and Commission Income





|  |       
|- | ------
|F | Leases



|    |                              
|--- | -----------------------------
|(1) | A group company is the lessee









|    |                              
|--- | -----------------------------
|(2) | A group company is the lessor





|  |                 
|- | ----------------
|G | Financial Assets



F-13



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




|    |                                                          
|--- | ---------------------------------------------------------
|(a) | Financial assets at fair value through profit or
    loss







| |       |                                                                                                                                                                                                                                                                  
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)   | it eliminates or significantly reduces a measurement or
    recognition inconsistency, an accounting mismatch,
    that would otherwise arise from measuring assets or liabilities
    or recognising the gains and losses on them on a different
    basis; or
|
| | (ii)  | a group of financial assets, financial liabilities or both is
    managed and its performance is evaluated on a fair value basis
    in accordance with documented risk management or investment
    strategy.                                                   
|
| | (iii) | If a contract contains one or more embedded derivatives that
    either significantly change the cash flows of the contract or
    the separation of the embedded derivative(s) is prohibited.                                                                   



|    |                      
|--- | ---------------------
|(b) | Loans and receivables





|    |                 
|--- | ----------------
|(c) | Held-to-maturity





|    |                   
|--- | ------------------
|(d) | Available-for-sale







F-14



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)






|  |                      
|- | ---------------------
|H | Financial Liabilities









| |       |                                                                                                                                                                                                                                                                  
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)   | it eliminates or significantly reduces a measurement or
    recognition inconsistency, an accounting mismatch,
    that would otherwise arise from measuring assets or liabilities
    or recognising the gains and losses on them on a different
    basis; or
|
| | (ii)  | a group of financial assets, financial liabilities or both is
    managed and its performance is evaluated on a fair value basis
    in accordance with documented risk management or investment
    strategy.                                                   
|
| | (iii) | If a contract contains one or more embedded derivatives that
    either significantly change the cash flows of the contract or
    the separation of the embedded derivative(s) is prohibited.                                                                   



|  |                                                         
|- | --------------------------------------------------------
|I | Sale and Repurchase Agreements and Lending of Securities







|  |                                  
|- | ---------------------------------
|J | Issued Debt and Equity Securities





F-15



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




|  |                                                      
|- | -----------------------------------------------------
|K | Derivative Financial Instruments and Hedge Accounting















|    |                 
|--- | ----------------
|(a) | Fair value hedge







|    |                
|--- | ---------------
|(b) | Cash flow hedge





F-16



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




(c)                  Net
investment hedge






|    |                                                         
|--- | --------------------------------------------------------
|(d) | Derivatives that do not qualify for hedge
    accounting





|  |                               
|- | ------------------------------
|L | Impairment of Financial Assets



|    |                                 
|--- | --------------------------------
|(a) | Assets carried at amortised cost







| |       |                                                                                                                                                                                                                                                                                                               
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)   | significant financial difficulty of the issuer or obligor;                                                                                                                                                                                                                                                    
|
| | (ii)  | a breach of contract, such as a default or delinquency in
    interest or principal payments;                                                                                                                                                                                                                 
|
| | (iii) | the Group granting to the borrower, for economic or legal
    reasons relating to the borrowers financial difficulty, a
    concession that the lender would not otherwise consider;                                                                                                                         
|
| | (iv)  | it becoming probable that the borrower will enter bankruptcy or
    other financial reorganisation;                                                                                                                                                                                                           
|
| | (v)   | the disappearance of an active market for that financial asset
    because of financial difficulties; or                                                                                                                                                                                                      
|
| | (vi)  | observable data indicating that there is a measurable decrease
    in the estimated future cash flows from a group of financial
    assets since the initial recognition of those assets, although
    the decrease cannot yet be identified with the individual
    financial assets in the group, including:







F-17



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)
















(b)                  Available-for-sale
assets




F-18



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




|  |                              
|- | -----------------------------
|M | Property, Plant and Equipment











|                                                  |  |                                               
|------------------------------------------------- |  | ----------------------------------------------
|Adaptation works on freehold & leasehold property |  | 15 years, or the remaining period of the lease
|Computer and other equipment                      |  | Maximum of ten years                          







|  |                  
|- | -----------------
|N | Intangible Assets



| |     |         
| | --- | --------
| | (a) | Goodwill









| |     |                  
| | --- | -----------------
| | (b) | Computer software



F-19



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)








| |     |                        
| | --- | -----------------------
| | (c) | Other intangible assets





|  |           
|- | ----------
|O | Provisions





|  |                  
|- | -----------------
|P | Employee Benefits



|    |                    
|--- | -------------------
|(a) | Pension obligations









F-20



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




|    |                             
|--- | ----------------------------
|(b) | Equity compensation benefits









|  |             
|- | ------------
|Q | Income Taxes















|  |                          
|- | -------------------------
|R | Cash and Cash Equivalents



F-21



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




|  |                                 
|- | --------------------------------
|S | Share Capital and Treasury Stock



|    |                  
|--- | -----------------
|(1) | Share issue costs





|    |                             
|--- | ----------------------------
|(2) | Dividends on ordinary shares





|    |                
|--- | ---------------
|(3) | Treasury shares





|  |             
|- | ------------
|T | Comparatives





|  |                          
|- | -------------------------
|U | Life Assurance Operations









Premiums and claims






F-22



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)


Reinsurance






|  |                                 
|- | --------------------------------
|V | Offsetting Financial Instruments





|  |           
|- | ----------
|W | Collateral











|  |                     
|- | --------------------
|X | Financial Guarantees







|  |                                           
|- | ------------------------------------------
|Y | Accounting Policies applying to March 2005



F-23



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)




Provisions for impairment of loans and receivables












Debt Securities and Equity Shares


Investment Securities




Other Securities




F-24



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)


Derivatives










| |      |                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)  | Adequate evidence of the intention to hedge must be established
    at the outset of the transaction.                                                                                                                                                                                                                                                                                                                              
|
| | (ii) | The transaction must match or eliminate a proportion of the risk
    inherent in the assets, liabilities, positions or cash flows
    being hedged and which results from potential movements in
    interest rates, exchange rates or market prices. Changes in the
    derivatives fair value must be highly correlated with changes in
    the fair value of the underlying hedged item for the entire life
    of the contract.









|  |                                                                      
|- | ---------------------------------------------------------------------
|Z | Prospective Accounting Changes/ Impact of New Accounting
    Policies









F-25



---



##### Table of Contents



BANK OF IRELAND GROUP


ACCOUNTING POLICIES  (Continued)






F-26



---



##### Table of Contents



BANK OF IRELAND GROUP


CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS




(a)              Impairment
losses on loans and advances




(b)             Fair
value of derivatives




(c)              Retirement
Benefits




(d)             Life
Assurance Operations






F-27



---



##### Table of Contents



BANK OF IRELAND GROUP


CRITICAL ACCOUNTING ESTIMATES AND
JUDGEMENTS  (Continued)




(e)              Taxation




(f)              Goodwill


 






F-28



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS




|   |  |                                                                                |  |     
|-- |  | ------------------------------------------------------------------------------ |  | ----
|   |  |                                                                                |  | Page
|   |  |                                                                                |  |     
|1  |  | Transition to IFRS                                                             |  | F-31
|2  |  | Segmental Reporting                                                            |  | F-31
|3  |  | Net interest income                                                            |  | F-34
|4  |  | Net trading income                                                             |  | F-34
|5  |  | Other operating income                                                         |  | F-35
|6  |  | Disposal of business activity                                                  |  | F-35
|7  |  | Other operating expenses                                                       |  | F-35
|8  |  | Auditors remuneration                                                          |  | F-36
|9  |  | Staff costs                                                                    |  | F-36
|10 |  | Staff numbers                                                                  |  | F-36
|11 |  | Income tax expense                                                             |  | F-37
|12 |  | Earnings per share                                                             |  | F-38
|13 |  | Central government and other eligible bills                                    |  | F-39
|14 |  | Financial assets at fair value through profit and loss
    (including trading) |  | F-39
|15 |  | Derivative financial instruments                                               |  | F-39
|16 |  | Loans and advances to banks                                                    |  | F-46
|17 |  | Loans and advances to customers                                                |  | F-47
|18 |  | Available for sale financial assets                                            |  | F-48
|19 |  | Debt securities                                                                |  | F-49
|20 |  | Interest in associated undertakings                                            |  | F-50
|21 |  | Interest in joint ventures                                                     |  | F-50
|22 |  | Intangible assets                                                              |  | F-51
|23 |  | Property, plant and equipment                                                  |  | F-52
|24 |  | Other assets                                                                   |  | F-53
|25 |  | Deposits by banks                                                              |  | F-53
|26 |  | Customer accounts                                                              |  | F-54
|27 |  | Debt securities in issue                                                       |  | F-54
|28 |  | Subordinated liabilities                                                       |  | F-55
|29 |  | Other liabilities                                                              |  | F-59
|30 |  | Provisions                                                                     |  | F-60
|31 |  | Deferred income taxes                                                          |  | F-61
|32 |  | Interest Rate Risk                                                             |  | F-62
|33 |  | Liquidity Risk                                                                 |  | F-65
|34 |  | Fair Values of Financial Assets and Liabilities                                |  | F-66
|35 |  | Retirement benefit obligations                                                 |  | F-68
|36 |  | Contingent liabilities and commitments                                         |  | F-72
|37 |  | Minority interest                                                              |  | F-73
|38 |  | Ordinary shares, share premium and treasury shares                             |  | F-73
|39 |  | Reserves and retained earnings                                                 |  | F-79

F-29



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|   |  |                                                                                         |  |      
|-- |  | --------------------------------------------------------------------------------------- |  | -----
|   |  |                                                                                         |  | Page 
|   |  |                                                                                         |  |      
|40 |  | Dividends per share                                                                     |  | F-80 
|41 |  | Cash and cash equivalents                                                               |  | F-80 
|42 |  | General                                                                                 |  | F-81 
|43 |  | Related party transactions                                                              |  | F-81 
|44 |  | Acquisitions                                                                            |  | F-83 
|45 |  | Life assurance business                                                                 |  | F-85 
|46 |  | Reconciliation of IR GAAP to IFRS                                                       |  | F-87 
|47 |  | Directors Information                                                                  |  | F-105
|48 |  | Group financial information for U.S. Investors
    SFAS No. 115 Accounting for Certain |  | F-113
|49 |  | Investments in Debt and Equity Securities                                              |  | F-133

F-30



---



##### Table of Contents



BANK OF IRELAND GROUP





NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS




|  |                   
|- | ------------------
|1 | TRANSITION TO IFRS



F-96 F-105 F-92 F-95. F-90 F-91. F-89




|                                                                            |  |              |       |   |               |  |       |  
|--------------------------------------------------------------------------- |  | ------------ | ----- | - | ------------- |  | ----- | -
|                                                                            |  | Profit after |       |   | Stockholders | 
|                                                                            |  | taxation     |       |   | equity        | 
|                                                                            |  |              |       |   |               | 
|                                                                            |  | March 31,    |       |   | March 31,     | 
|                                                                            |  | 2005         |       |   | 2005          | 
|                                                                            |  |              |       |   |               | 
|                                                                            |  | m           |       |   | m            | 
|As reported under Irish GAAP                                                |  |              | 1,080 |   |               |  | 4,789 |  
|Reconciliation adjustments to IFRS excluding IAS 32, IAS 39 and
    IFRS 4: |  |              |       |   |               |  |       |  
|Consolidation of new entities and insurance businesses                      |  |              | 8     |   |               |  | (55   | )
|Leasing                                                                     |  |              | (8    | ) |               |  | 44    |  
|Retirement benefit obligations                                              |  |              | (23   | ) |               |  | (695  | )
|Property, plant and equipment                                               |  |              |      |   |               |  | (102  | )
|Intangible assets & goodwill                                                |  |              | 13    |   |               |  | 12    |  
|Dividends                                                                   |  |              |      |   |               |  | 282   |  
|Employee benefits                                                           |  |              | (8    | ) |               |  | 3     |  
|Other                                                                       |  |              | (8    | ) |               |  | (1    | )
|                                                                            |  |              |       |   |               | 
|IFRS excluding IAS 32, IAS 39 and IFRS 4                                    |  |              | 1,054 |   |               |  | 4,277 |  
|                                                                            |  |              |       |   |               | 
|Reconciliation adjustments to IAS 32, IAS 39 and IFRS 4:                    |  |              |       |   |               |  |       |  
|Reclassification of financial instruments                                   |  |              |       |   |               |  | 127   |  
|Hedging                                                                     |  |              |       |   |               |  | 15    |  
|Write down of VIF in Life business                                          |  |              |       |   |               |  | (251  | )
|Debt/equity reclassification                                                |  |              |       |   |               |  | 114   |  
|Effective interest rate                                                     |  |              |       |   |               |  | 20    |  
|Other                                                                       |  |              |       |   |               |  | 3     |  
|                                                                            |  |              |       |   |               | 
|April 1, 2005                                                               |  |              |       |   |               |  | 4,305 |  
|                                                                            |  |              |       |   |               | 



|  |                    
|- | -------------------
|2 | SEGMENTAL REPORTING



F-31



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|  |                                 
|- | --------------------------------
|2 | SEGMENTAL REPORTING  (continued)



.


Business Segments


|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |   |  |  |          |   |  |  |         |  
|--------------------------------------------------------------- |  | ----------- | ------ | - | ---- |  | --------- | --------- |  | -- | --------- | - | ----- | ---------- | ------ | - | ------ |  | ----- | ------------ |  |  | ------ | - |  |  | -------- | - |  |  | ------- | -
|                                                                |  | Retail      |        |   |      |  | Wholesale |           |  | UK |           |   | Asset |            |        |   |        |  |       |             
|                                                                |  | Republic of |        |   | BOI  |  |           | Financial |  |    | Financial |   |       | Management |        |   | Group  |  |       |              |  | 
|Year ended March 31, 2006                                       |  | Ireland     |        |   | Life |  |           | Services  |  |    | Services  |   |       | Services   |        |   | Centre |  |       | Eliminations |  |  | Total  |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|                                                                |  | m          |        |   | m   |  |           | m        |  |    | m        |   |       | m         |        |   | m     |  |       | m           |  |  | m     |  
|Net interest income                                             |  |             | 1,119  |   |      |  | 8         |           |  |    | 454       |   |       |            | 722    |   |        |  | 7     |              |  |  | (3     | ) |  |  |         |   |  |  | 2,307   |  
|Insurance net premium income                                    |  |             |       |   |      |  | 1,264     |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 34     |   |  |  |         |   |  |  | 1,298   |  
|Other income                                                    |  |             | 351    |   |      |  | 681       |           |  |    | 243       |   |       |            | 94     |   |        |  | 215   |              |  |  | (22    | ) |  |  |         |   |  |  | 1,562   |  
|Profit on disposal of business activities                       |  |             |       |   |      |  |          |           |  |    |          |   |       |            | 176    |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | 176     |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income                                                    |  |             | 1,470  |   |      |  | 1,953     |           |  |    | 697       |   |       |            | 992    |   |        |  | 222   |              |  |  | 9      |   |  |  |         |   |  |  | 5,343   |  
|Insurance claims                                                |  |             |       |   |      |  | (1,655    | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  | (11    | ) |  |  |         |   |  |  | (1,666  | )
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income, net of insurance claims                           |  |             | 1,470  |   |      |  | 298       |           |  |    | 697       |   |       |            | 992    |   |        |  | 222   |              |  |  | (2     | ) |  |  |         |   |  |  | 3,677   |  
|Operating expenses                                              |  |             | (790   | ) |      |  | (92       | )         |  |    | (271      | ) |       |            | (448   | ) |        |  | (133  | )            |  |  | (120   | ) |  |  |         |   |  |  | (1,854  | )
|Depreciation and amortisation                                   |  |             | (81    | ) |      |  | (3        | )         |  |    | (17       | ) |       |            | (33    | ) |        |  | (4    | )            |  |  | (28    | ) |  |  |         |   |  |  | (166    | )
|Impairment losses                                               |  |             | (54    | ) |      |  |          |           |  |    | (23       | ) |       |            | (26    | ) |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (103    | )
|Income from associates and joint ventures                       |  |             | 5      |   |      |  |          |           |  |    |          |   |       |            | 40     |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | 45      |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Profit before taxation                                          |  |             | 550    |   |      |  | 203       |           |  |    | 386       |   |       |            | 525    |   |        |  | 85    |              |  |  | (150   | ) |  |  |         |   |  |  | 1,599   |  
|Sale of business activities                                     |  |             |       |   |      |  |          |           |  |    |          |   |       |            | (176   | ) |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (176    | )
|Gross up of policyholder tax in the Life business               |  |             |       |   |      |  | (69       | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (69     | )
|Hedge ineffectiveness on transition to IFRS                     |  |             |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 7      |   |  |  |         |   |  |  | 7       |  
|Restructuring programme                                         |  |             |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 32     |   |  |  |         |   |  |  | 32      |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Group profit before tax excluding the impact of above
    items |  |             | 550    |   |      |  | 134       |           |  |    | 386       |   |       |            | 349    |   |        |  | 85    |              |  |  | (111   | ) |  |  |         |   |  |  | 1,393   |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total assets                                                    |  |             | 77,935 |   |      |  | 12,326    |           |  |    | 136,774   |   |       |            | 54,580 |   |        |  | 2,906 |              |  |  | 19,533 |   |  |  | (141,700 | ) |  |  | 162,354 |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total liabilities                                               |  |             | 76,320 |   |      |  | 12,210    |           |  |    | 135,896   |   |       |            | 52,501 |   |        |  | 2,506 |              |  |  | 19,248 |   |  |  | (141,700 | ) |  |  | 156,981 |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Capital expenditure                                             |  |             | 55     |   |      |  |          |           |  |    | 10        |   |       |            | 58     |   |        |  | 26    |              |  |  | 30     |   |  |  |         |   |  |  | 179     |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  



F-32



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|  |                                 
|- | --------------------------------
|2 | SEGMENTAL REPORTING  (continued)

Business Segments


|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |   |  |  |          |   |  |  |         |  
|--------------------------------------------------------------- |  | ----------- | ------ | - | ---- |  | --------- | --------- |  | -- | --------- | - | ----- | ---------- | ------ | - | ------ |  | ----- | ------------ |  |  | ------ | - |  |  | -------- | - |  |  | ------- | -
|                                                                |  | Retail      |        |   |      |  | Wholesale |           |  | UK |           |   | Asset |            |        |   |        |  |       |             
|                                                                |  | Republic of |        |   | BOI  |  |           | Financial |  |    | Financial |   |       | Management |        |   | Group  |  |       |              |  | 
|Year ended March 31, 2005                                       |  | Ireland     |        |   | Life |  |           | Services  |  |    | Services  |   |       | Services   |        |   | Centre |  |       | Eliminations |  |  | Total  |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|                                                                |  | m          |        |   | m   |  |           | m        |  |    | m        |   |       | m         |        |   | m     |  |       | m           |  |  | m     |  
|Net interest income                                             |  |             | 1,019  |   |      |  | 6         |           |  |    | 302       |   |       |            | 617    |   |        |  | 4     |              |  |  | (17    | ) |  |  |         |   |  |  | 1,931   |  
|Insurance net premium income                                    |  |             |       |   |      |  | 1,755     |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | 36     |   |  |  |         |   |  |  | 1,791   |  
|Other income                                                    |  |             | 318    |   |      |  | 709       |           |  |    | 310       |   |       |            | 246    |   |        |  | 252   |              |  |  | (36    | ) |  |  |         |   |  |  | 1,799   |  
|Profit on disposal of business activities                       |  |             |       |   |      |  |          |           |  |    |          |   |       |            | (20    | ) |        |  |      |              |  |  | 31     |   |  |  |         |   |  |  | 11      |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income                                                    |  |             | 1,337  |   |      |  | 2,470     |           |  |    | 612       |   |       |            | 843    |   |        |  | 256   |              |  |  | 14     |   |  |  |         |   |  |  | 5,532   |  
|Insurance claims                                                |  |             |       |   |      |  | (2,216    | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  | (6     | ) |  |  |         |   |  |  | (2,222  | )
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total income, net of insurance claims                           |  |             | 1,337  |   |      |  | 254       |           |  |    | 612       |   |       |            | 843    |   |        |  | 256   |              |  |  | 8      |   |  |  |         |   |  |  | 3,310   |  
|Operating expenses                                              |  |             | (729   | ) |      |  | (89       | )         |  |    | (227      | ) |       |            | (504   | ) |        |  | (128  | )            |  |  | (197   | ) |  |  |         |   |  |  | (1,874  | )
|Depreciation and amortisation                                   |  |             | (85    | ) |      |  | (4        | )         |  |    | (13       | ) |       |            | (47    | ) |        |  | (3    | )            |  |  | (25    | ) |  |  |         |   |  |  | (177    | )
|Impairment losses                                               |  |             | (51    | ) |      |  |          |           |  |    | (38       | ) |       |            | 10     |   |        |  |      |              |  |  | 100    |   |  |  |         |   |  |  | 21      |  
|Income from associates and joint ventures                       |  |             | (2     | ) |      |  |          |           |  |    |          |   |       |            | 32     |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | 30      |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Profit before taxation                                          |  |             | 470    |   |      |  | 161       |           |  |    | 334       |   |       |            | 334    |   |        |  | 125   |              |  |  | (114   | ) |  |  |         |   |  |  | 1,310   |  
|Sale of business activities                                     |  |             |       |   |      |  |          |           |  |    |          |   |       |            | 20     |   |        |  |      |              |  |  | (31    | ) |  |  |         |   |  |  | (11     | )
|Gross up of policyholder tax in the Life business               |  |             |       |   |      |  | (26       | )         |  |    |          |   |       |            |       |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  | (26     | )
|Hedge ineffectiveness on transition to IFRS                     |  |             |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  |       |   |  |  |         |   |  |  |        |  
|Loan loss write back                                            |  |             |       |   |      |  |          |           |  |    |          |   |       |            |       |   |        |  |      |              |  |  | (100   | ) |  |  |         |   |  |  | (100    | )
|Restructuring programme                                         |  |             | 4      |   |      |  |          |           |  |    |          |   |       |            | 2      |   |        |  |      |              |  |  | 117    |   |  |  |         |   |  |  | 123     |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Group profit before tax excluding the impact of above
    items |  |             | 474    |   |      |  | 135       |           |  |    | 334       |   |       |            | 356    |   |        |  | 125   |              |  |  | (128   | ) |  |  |         |   |  |  | 1,296   |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total assets                                                    |  |             | 57,830 |   |      |  | 8,977     |           |  |    | 101,203   |   |       |            | 42,941 |   |        |  | 2,980 |              |  |  | 18,113 |   |  |  | (104,264 | ) |  |  | 127,780 |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Total liabilities                                               |  |             | 56,427 |   |      |  | 8,876     |           |  |    | 100,473   |   |       |            | 41,221 |   |        |  | 2,600 |              |  |  | 18,035 |   |  |  | (104,264 | ) |  |  | 123,368 |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  
|Capital expenditure                                             |  |             | 59     |   |      |  | 7         |           |  |    | 14        |   |       |            | 88     |   |        |  | 4     |              |  |  | 15     |   |  |  |         |   |  |  | 187     |  
|                                                                |  |             |        |   |      |  |           |           |  |    |           |   |       |            |        |   |        |  |       |              |  |  |        |  



Geographical Segments


|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |        |   |  |  |       | 
|---------------------- |  | ------- | ----- | ------ | ------- |  | ------- | ----- |  | ------------- | ------- |  |  | ----- | ------ | - |  |  | ----- | 
|                       |  | 2006    |      
|                       |  |         |      
|                       |  |         |       | United |         |  | Rest of |       |  | Inter-segment |         |  | 
|                       |  | Ireland |       |        | Kingdom |  |         | World |  |               | Revenue |  |  | Total |       
|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |       
|                       |  | m      |       |        | m      |  |         | m    |  |               | m      |  |  | m    |       
|Revenue                |  |         | 5,327 |        |         |  | 3,861   |       |  |               | 234     |  |  |       | (1,883 | ) |  |  | 7,539 | 
|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |       
|Profit before taxation |  |         | 1,078 |        |         |  | 478     |       |  |               | 43      |  |  |       |       |   |  |  | 1,599 | 
|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |       

F-33



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|  |                                 
|- | --------------------------------
|2 | SEGMENTAL REPORTING  (continued)

|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |         |   |  |  |         | 
|------------------- |  | ------- | ------- | ------ | ------- |  | ------- | ----- |  |  | ------------ |  |  | ----- | ------- | - |  |  | ------- | 
|                    |  |         |         | United |         |  | Rest of |       |  |  |              | 
|                    |  | Ireland |         |        | Kingdom |  |         | World |  |  | Eliminations |  |  | Total |        
|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |        
|                    |  | m      |         |        | m      |  |         | m    |  |  | m           |  |  | m    |        
|Total assets        |  |         | 143,484 |        |         |  | 63,680  |       |  |  | 3,885        |  |  |       | (48,695 | ) |  |  | 162,354 | 
|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |        
|Capital expenditure |  |         | 95      |        |         |  | 58      |       |  |  | 26           |  |  |       |        |   |  |  | 179     | 
|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |        

|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |        |   |  |  |       | 
|---------------------- |  | ------- | ----- | ------ | ------- |  | ------- | ----- |  | ------------- | ------- |  |  | ----- | ------ | - |  |  | ----- | 
|                       |  | 2005    |      
|                       |  |         |      
|                       |  |         |       | United |         |  | Rest of |       |  | Inter-segment |         |  | 
|                       |  | Ireland |       |        | Kingdom |  |         | World |  |               | Revenue |  |  | Total |       
|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |       
|                       |  | m      |       |        | m      |  |         | m    |  |               | m      |  |  | m    |       
|Revenue                |  |         | 3,594 |        |         |  | 3,170   |       |  |               | 192     |  |  |       | (1,021 | ) |  |  | 5,935 | 
|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |       
|Profit before taxation |  |         | 991   |        |         |  | 273     |       |  |               | 46      |  |  |       |       |   |  |  | 1,310 | 
|                       |  |         |       |        |         |  |         |       |  |               |         |  |  |       |       

|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |         |   |  |  |         | 
|------------------- |  | ------- | ------- | ------ | ------- |  | ------- | ----- |  |  | ------------ |  |  | ----- | ------- | - |  |  | ------- | 
|                    |  |         |         | United |         |  | Rest of |       |  |  |              | 
|                    |  | Ireland |         |        | Kingdom |  |         | World |  |  | Eliminations |  |  | Total |        
|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |        
|                    |  | m      |         |        | m      |  |         | m    |  |  | m           |  |  | m    |        
|Total assets        |  |         | 109,606 |        |         |  | 50,551  |       |  |  | 4,262        |  |  |       | (36,639 | ) |  |  | 127,780 | 
|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |        
|Capital expenditure |  |         | 95      |        |         |  | 87      |       |  |  | 5            |  |  |       |        |   |  |  | 187     | 
|                    |  |         |         |        |         |  |         |       |  |  |              |  |  |       |        



|  |                    
|- | -------------------
|3 | NET INTEREST INCOME

|                                      |  |      |       |  |      |  |       | 
|------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                                      |  | 2006 |       |  | 2005 | 
|                                      |  |      |       |  |      | 
|                                      |  | m   |       |  | m   | 
|Interest and similar income           |  |      |       |  |      |  |       | 
|Loans and advances to banks           |  |      | 238   |  |      |  | 215   | 
|Loans and advances to customers       |  |      | 4,576 |  |      |  | 3,353 | 
|Financial assets  available for sale |  |      | 934   |  |      |  | 483   | 
|Finance leasing                       |  |      | 197   |  |      |  | 212   | 
|Other                                 |  |      | 9     |  |      |  |      | 
|                                      |  |      |       |  |      | 
|Total interest income                 |  |      | 5,954 |  |      |  | 4,263 | 
|                                      |  |      |       |  |      | 
|Interest expense and similar charges  |  |      |       |  |      |  |       | 
|Interest on subordinated liabilities  |  |      | 250   |  |      |  | 225   | 
|Other interest payable                |  |      | 3,397 |  |      |  | 2,107 | 
|                                      |  |      |       |  |      | 
|Total interest expense                |  |      | 3,647 |  |      |  | 2,332 | 
|                                      |  |      |       |  |      | 



|  |                   
|- | ------------------
|4 | NET TRADING INCOME

|                                         |  |      |     |   |      |  |    | 
|---------------------------------------- |  | ---- | --- | - | ---- |  | -- | 
|                                         |  | 2006 |     |   | 2005 | 
|                                         |  |      |     |   |      | 
|                                         |  | m   |     |   | m   | 
|Foreign exchange                         |  |      | 24  |   |      |  | 26 | 
|Securities and interest rate contracts   |  |      | 49  |   |      |  | 40 | 
|Equities and equity derivative contracts |  |      | (29 | ) |      |  |   | 
|Hedge ineffectiveness                    |  |      | (14 | ) |      |  |   | 
|                                         |  |      |     |   |      | 
|                                         |  |      | 30  |   |      |  | 66 | 
|                                         |  |      |     |   |      | 

F-34



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|  |                                
|- | -------------------------------
|4 | NET TRADING INCOME  (continued)






|  |                       
|- | ----------------------
|5 | OTHER OPERATING INCOME

|                                                                |  |      |    |    |      |  |     |      |  |  |     | 
|--------------------------------------------------------------- |  | ---- | -- | -- | ---- |  | --- | ---- |  |  | --- | 
|                                                                |  | Note |    |    | 2006 |  |     | 2005 | 
|                                                                |  |      |    |    |      |  |     |      | 
|                                                                |  |      |    | m |      |  | m  |     
|Profit on disposal of financial assets  available for
    sale |  |      | 18 |    |      |  | 4   |      |  |  | 2   | 
|Other insurance income                                          |  |      |    |    |      |  | 151 |      |  |  | 84  | 
|Other income                                                    |  |      |    |    |      |  | 10  |      |  |  | 52  | 
|                                                                |  |      |    |    |      |  |     |      | 
|                                                                |  |      |    |    |      |  | 165 |      |  |  | 138 | 
|                                                                |  |      |    |    |      |  |     |      | 



|  |                              
|- | -----------------------------
|6 | DISPOSAL OF BUSINESS ACTIVITY



|                                      |  |      |     | 
|------------------------------------- |  | ---- | --- | 
|                                      |  | 2006 |    
|                                      |  |      |    
|                                      |  | m   |    
|Carrying value of net tangible assets |  |      | 8   | 
|Cost of disposal                      |  |      | 43  | 
|Gain on disposal of branch operations |  |      | 176 | 
|                                      |  |      |    
|Cash consideration received           |  |      | 227 | 
|                                      |  |      |    



|  |                         
|- | ------------------------
|7 | OTHER OPERATING EXPENSES

|                                |  |       |    |    |      |  |       |      |  |  |       | 
|------------------------------- |  | ----- | -- | -- | ---- |  | ----- | ---- |  |  | ----- | 
|                                |  | Notes |    |    | 2006 |  |       | 2005 | 
|                                |  |       |    |    |      |  |       |      | 
|                                |  |       |    | m |      |  | m    |     
|Staff costs                     |  |       | 9  |    |      |  | 1,167 |      |  |  | 1,109 | 
|Administrative expenses         |  |       |    |    |      |  | 687   |      |  |  | 765   | 
|Depreciation                    |  |       |    |    |      |  |       |      |  |  |       | 
| Intangibles                   |  |       | 23 |    |      |  | 106   |      |  |  | 101   | 
| Property, plant and equipment |  |       | 24 |    |      |  | 60    |      |  |  | 76    | 
|                                |  |       |    |    |      |  |       |      | 
|                                |  |       |    |    |      |  | 2,020 |      |  |  | 2,051 | 
|                                |  |       |    |    |      |  |       |      | 

F-35



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|  |                                       
|- | --------------------------------------
|8 | AUDITORS REMUNERATION (EXCLUDING VAT)

|                                     |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |     |  |  |  |     | 
|------------------------------------ |  | ----- | ----- | --------------- | --- |  | ---- | ----------- |  |  | ----- |  |  | ----- | --- |  |  |  | --- | 
|                                     |  |       |       | 2006            |     |  | 2005 |            
|                                     |  |       |       |                 |     |  |      |            
|                                     |  | Notes |       |                 | ROI |  |      | Overseas(i) |  |  | Total |  |  | Total |    
|                                     |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |    
|                                     |  |       |       | (in  millions) |     |  |     
|Audit and assurance services         |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |     |  |  |  |     | 
|Statutory audit (including expenses) |  |       |       |                 |     |  | 3.0  |             |  |  | 1.1   |  |  |       | 4.1 |  |  |  | 3.1 | 
|Other audit and assurance services   |  |       | (ii)  |                 |     |  | 2.1  |             |  |  | 0.6   |  |  |       | 2.7 |  |  |  | 0.7 | 
|                                     |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |    
|                                     |  |       |       |                 |     |  | 5.1  |             |  |  | 1.7   |  |  |       | 6.8 |  |  |  | 3.8 | 
|                                     |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |    
|Other services                       |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |     |  |  |  |     | 
|Transaction services                 |  |       | (iii) |                 |     |  | 0.0  |             |  |  | 0.1   |  |  |       | 0.1 |  |  |  | 0.7 | 
|Taxation services                    |  |       |       |                 |     |  | 0.7  |             |  |  | 1.5   |  |  |       | 2.2 |  |  |  | 3.9 | 
|Other services                       |  |       |       |                 |     |  | 0.0  |             |  |  | 0.2   |  |  |       | 0.2 |  |  |  | 0.7 | 
|                                     |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |    
|                                     |  |       |       |                 |     |  | 0.7  |             |  |  | 1.8   |  |  |       | 2.5 |  |  |  | 5.3 | 
|                                     |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |    
|                                     |  |       |       |                 |     |  | 5.8  |             |  |  | 3.5   |  |  |       | 9.3 |  |  |  | 9.1 | 
|                                     |  |       |       |                 |     |  |      |             |  |  |       |  |  |       |    





| |       |                                                                                                                                                                                                                    
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)   | Fees to overseas auditors principally consist of fees to PwC in
    the United Kingdom.                                                                                                                            
|
| | (ii)  | Other audit and assurance services consist primarily of fees in
    connection with reporting to regulators, letters of comfort,
    transition to IFRS, preparation for Sarbanes Oxley and
    accountancy advice.
|
| | (iii) | Transaction service costs relate primarily to financial due
    diligence and other assignments.                                                                                                                   





|  |            
|- | -----------
|9 | STAFF COSTS

|                                                |  |      |       |  |      |  |       | 
|----------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                                                |  | 2006 |       |  | 2005 | 
|                                                |  |      |       |  |      | 
|                                                |  | m   |       |  | m   | 
|Wages and salaries                              |  |      | 911   |  |      |  | 895   | 
|Social security costs                           |  |      | 81    |  |      |  | 80    | 
|Pension costs  defined contribution plans      |  |      | 5     |  |      |  | 2     | 
|Pension costs  defined benefit plans (Note 35) |  |      | 139   |  |      |  | 97    | 
|Share based payment schemes                     |  |      | 11    |  |      |  | 11    | 
|Other                                           |  |      | 20    |  |      |  | 24    | 
|                                                |  |      |       |  |      | 
|                                                |  |      | 1,167 |  |      |  | 1,109 | 
|                                                |  |      |       |  |      | 



|   |              
|-- | -------------
|10 | STAFF NUMBERS



F-36



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                           
|-- | --------------------------
|10 | STAFF NUMBERS  (continued)

|                             |  |      |        |  |      |  |        | 
|---------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|                             |  | 2006 |        |  | 2005 | 
|                             |  |      |        |  |      | 
|Retail Republic of Ireland   |  |      | 7,987  |  |      |  | 7,927  | 
|BOI Life                     |  |      | 1,063  |  |      |  | 1,051  | 
|Wholesale Financial Services |  |      | 1,436  |  |      |  | 1,263  | 
|UK Financial Services        |  |      | 3,930  |  |      |  | 4,963  | 
|Asset Management Services    |  |      | 655    |  |      |  | 634    | 
|Group Centre                 |  |      | 1,119  |  |      |  | 1,122  | 
|                             |  |      |        |  |      | 
|                             |  |      | 16,190 |  |      |  | 16,960 | 
|                             |  |      |        |  |      | 



|   |                   
|-- | ------------------
|11 | INCOME TAX EXPENSE

|                                                |              |      |     |     |      |  |     |     | 
|----------------------------------------------- | ------------ | ---- | --- | --- | ---- |  | --- | --- | 
|                                                |              | 2006 |     |     | 2005 | 
|                                                |              |      |     |     |      | 
|                                                |              | m   |     |     | m   | 
|Current Tax                                     |              |      |     |     |      |  |     |    
|Irish Corporation Tax                           |              |      |     |     |      |  |     |    
|                                                | Current Year |      |     | 191 |      |  |     | 142 | 
|                                                | Prior Year   |      |     | 8   |      |  |     | 2   | 
|Double Taxation Relief                          |              |      | (20 | )   |      |  | (19 | )  
|Foreign Tax                                     |              |      |     |     |      |  |     |    
|                                                | Current Year |      |     | 86  |      |  |     | 75  | 
|                                                | Prior Year   |      |     | (3  | )    |  |     | 3   | 
|                                                |              |      |     |     |      | 
|                                                |              |      | 262 |     |      |  | 203 |    
|Deferred Tax                                    |              |      |     |     |      |  |     |    
|Origination & reversal of temporary differences |              |      | 41  |     |      |  | 53  |    
|                                                |              |      |     |     |      | 
|                                                |              |      | 303 |     |      |  | 256 |    
|                                                |              |      |     |     |      | 



F-37



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                
|-- | -------------------------------
|11 | INCOME TAX EXPENSE  (continued)



|                                                                                                                                |  |      |     |   |      |  |     |  
|------------------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | - | ---- |  | --- | -
|                                                                                                                                |  | 2006 |     |   | 2005 | 
|                                                                                                                                |  |      |     |   |      | 
|                                                                                                                                |  | m   |     |   | m   | 
|Profit on ordinary activities before tax multiplied by the
    Standard rate of Corporate tax in Ireland of 12.5% (2005: 12.5%) |  |      | 200 |   |      |  | 165 |  
|Effects of:                                                                                                                     |  |      |     |   |      |  |     |  
|Levy on certain financial institutions                                                                                          |  |      | 20  |   |      |  | 26  |  
|Foreign earnings subject to different rates of tax                                                                              |  |      | 78  |   |      |  | 49  |  
|Life Assurance  different basis of tax                                                                                         |  |      | 61  |   |      |  | 31  |  
|Tax exempted profits and income at a reduced Irish tax rate                                                                     |  |      | (71 | ) |      |  | (18 | )
|Non-deductible expenses                                                                                                         |  |      | 12  |   |      |  | 1   |  
|Prior year under provision                                                                                                      |  |      | 5   |   |      |  | 5   |  
|Share of Associates profits shown post tax in income statement                                                                  |  |      | (6  | ) |      |  | (5  | )
|Other adjustments for income tax purposes                                                                                       |  |      | 4   |   |      |  | 2   |  
|                                                                                                                                |  |      |     |   |      | 
|Income tax charge                                                                                                               |  |      | 303 |   |      |  | 256 |  
|                                                                                                                                |  |      |     |   |      | 



|   |                   
|-- | ------------------
|12 | EARNINGS PER SHARE




|                                                                                                                                                |  |      |        |  |      |  |        | 
|----------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|                                                                                                                                                |  | 2006 |        |  | 2005 | 
|                                                                                                                                                |  |      |        |  |      | 
|Basic                                                                                                                                           |  |      |        |  |      |  |        | 
|Profit attributable to Ordinary Stockholders                                                                                                    |  |      | 1,292m |  |      |  | 1,047m | 
|Weighted average number of shares in issue excluding Treasury
    stock and own shares held for the benefit of life assurance
    policyholders |  |      | 947m   |  |      |  | 942m   | 
|Basic earnings per share                                                                                                                        |  |      | 136.4c |  |      |  | 111.1c | 
|                                                                                                                                                |  |      |        |  |      | 



|                                                                                                                                                |  |      |        |  |      |  |        | 
|----------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|                                                                                                                                                |  | 2006 |        |  | 2005 | 
|                                                                                                                                                |  |      |        |  |      | 
|Diluted                                                                                                                                         |  |      |        |  |      |  |        | 
|Profit attributable to Ordinary Stockholders                                                                                                    |  |      | 1,292m |  |      |  | 1,047m | 
|                                                                                                                                                |  |      |        |  |      | 
|Weighted average number of shares in issue excluding Treasury
    stock and own shares held for the benefit of life assurance
    policyholders |  |      | 947m   |  |      |  | 942m   | 
|Effect of all dilutive potential Ordinary Stock                                                                                                 |  |      | 7m     |  |      |  | 8m     | 
|                                                                                                                                                |  |      |        |  |      | 
|                                                                                                                                                |  |      | 954m   |  |      |  | 950m   | 
|                                                                                                                                                |  |      |        |  |      | 
|Diluted earnings per share                                                                                                                      |  |      | 135.4c |  |      |  | 110.2c | 
|                                                                                                                                                |  |      |        |  |      | 

F-38



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                            
|-- | -------------------------------------------
|13 | CENTRAL GOVERNMENT AND OTHER ELIGIBLE BILLS

|                   |  |      |   |  |      |  |       | 
|------------------ |  | ---- | - |  | ---- |  | ----- | 
|                   |  | 2006 |   |  | 2005 | 
|                   |  |      |   |  |      | 
|                   |  | m   |   |  | m   | 
|At fair value      |  |      |  |  |      |  | 1,607 | 
|Available for sale |  |      | 8 |  |      |  |      | 
|                   |  |      |   |  |      | 
|                   |  |      | 8 |  |      |  | 1,607 | 
|                   |  |      |   |  |      | 



|   |                                                                               
|-- | ------------------------------------------------------------------------------
|14 | FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS
    (INCLUDING TRADING)

|                                                                                               |  |      |        |  |      |  |   | 
|---------------------------------------------------------------------------------------------- |  | ---- | ------ |  | ---- |  | - | 
|                                                                                               |  | 2006 |        |  | 2005 | 
|                                                                                               |  |      |        |  |      | 
|                                                                                               |  | m   |        |  | m   | 
|Trading                                                                                        |  |      |        |  |      |  |   | 
|Government bonds                                                                               |  |      | 156    |  |      |  |  | 
|Other debt securities                                                                          |  |      |        |  |      |  |   | 
| Listed                                                                                       |  |      | 440    |  |      |  |  | 
| Unlisted                                                                                     |  |      |       |  |      |  |  | 
|Equity securities                                                                              |  |      |        |  |      |  |   | 
| Listed                                                                                       |  |      | 23     |  |      |  |  | 
| Unlisted                                                                                     |  |      | 1      |  |      |  |  | 
|                                                                                               |  |      |        |  |      | 
|Total trading                                                                                  |  |      | 620    |  |      |  |  | 
|                                                                                               |  |      |        |  |      | 
|Financial assets at fair value through profit and loss
    (designated at initial recognition) |  |      |        |  |      |  |   | 
|Government bonds                                                                               |  |      | 2,033  |  |      |  |  | 
|Debt securities                                                                                |  |      | 725    |  |      |  |  | 
|Equity securities                                                                              |  |      | 7,822  |  |      |  |  | 
|                                                                                               |  |      |        |  |      | 
|                                                                                               |  |      | 10,580 |  |      |  |  | 
|                                                                                               |  |      |        |  |      | 



|   |                                 
|-- | --------------------------------
|15 | DERIVATIVE FINANCIAL INSTRUMENTS

RISK MANAGEMENT








F-39



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                     
|-- | ----------------------------------------------------
|15 | DERIVATIVE FINANCIAL
    INSTRUMENTS     (continued)





CREDIT RISK












MARKET RISK






Trading Book






F-40



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                     
|-- | ----------------------------------------------------
|15 | DERIVATIVE FINANCIAL
    INSTRUMENTS     (continued)



Banking Book








STRUCTURAL FOREIGN EXCHANGE






|                             |  |                |       |  |                |  |       | 
|---------------------------- |  | -------------- | ----- |  | -------------- |  | ----- | 
|                             |  | March 31, 2006 |       |  | March 31, 2005 | 
|                             |  |                |       |  |                | 
|                             |  | m             |       |  | m             | 
|GBP                          |  |                | 3,373 |  |                |  | 2,908 | 
|USD                          |  |                | 264   |  |                |  | 248   | 
|                             |  |                |       |  |                | 
|Total structural FX position |  |                | 3,637 |  |                |  | 3,156 | 
|                             |  |                |       |  |                | 

 


LIQUIDITY RISK






F-41



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                     
|-- | ----------------------------------------------------
|15 | DERIVATIVE FINANCIAL
    INSTRUMENTS     (continued)

DERIVATIVE POLICY


















F-42



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                     
|-- | ----------------------------------------------------
|15 | DERIVATIVE FINANCIAL
    INSTRUMENTS     (continued)



|                                                       |  |           |         |  |             |  |       |             |  |  |       | 
|------------------------------------------------------ |  | --------- | ------- |  | ----------- |  | ----- | ----------- |  |  | ----- | 
|                                                       |  | Contract/ |         |  | Fair values | 
|                                                       |  | notional  |         |  |             | 
|Year ended March 31, 2006                              |  | amount    |         |  | Assets      |  |       | Liabilities | 
|                                                       |  |           |         |  |             |  |       |             | 
|                                                       |  | m        |         |  | m          |  |       | m          | 
|Derivatives held for trading                           |  |           |         |  |             |  |       |             |  |  |       | 
|Foreign exchange derivatives                           |  |           |         |  |             |  |       |             |  |  |       | 
|Currency forwards                                      |  |           | 18,880  |  |             |  | 113   |             |  |  | 69    | 
|Currency swaps                                         |  |           | 630     |  |             |  | 22    |             |  |  | 37    | 
|OTC currency options                                   |  |           | 1,659   |  |             |  | 3     |             |  |  | 3     | 
|Currency futures                                       |  |           | 31      |  |             |  |      |             |  |  |      | 
|                                                       |  |           |         |  |             |  |       |             | 
|Total foreign exchange derivatives held for trading    |  |           | 21,200  |  |             |  | 138   |             |  |  | 109   | 
|                                                       |  |           |         |  |             |  |       |             | 
|Interest rate derivatives                              |  |           |         |  |             |  |       |             |  |  |       | 
|Interest rate swaps                                    |  |           | 89,830  |  |             |  | 394   |             |  |  | 446   | 
|Cross-currency interest rate swaps                     |  |           | 9,065   |  |             |  | 132   |             |  |  | 48    | 
|Forward rate agreements                                |  |           | 9,402   |  |             |  | 2     |             |  |  | 4     | 
|OTC interest rate options                              |  |           | 2,385   |  |             |  | 6     |             |  |  | 8     | 
|Interest rate futures                                  |  |           | 5,378   |  |             |  |      |             |  |  |      | 
|                                                       |  |           |         |  |             |  |       |             | 
|Total interest rate derivatives held for trading       |  |           | 116,060 |  |             |  | 534   |             |  |  | 506   | 
|                                                       |  |           |         |  |             |  |       |             | 
|Equity index linked contracts held                     |  |           | 8,294   |  |             |  | 915   |             |  |  | 615   | 
|                                                       |  |           |         |  |             |  |       |             | 
|Credit derivatives                                     |  |           | 60      |  |             |  |      |             |  |  |      | 
|                                                       |  |           |         |  |             |  |       |             | 
|Total derivative assets / liabilities held for trading |  |           | 145,614 |  |             |  | 1,587 |             |  |  | 1,230 | 
|                                                       |  |           |         |  |             |  |       |             | 
|Derivatives held for hedging                           |  |           |         |  |             |  |       |             |  |  |       | 
|Derivatives designated as fair value hedges            |  |           |         |  |             |  |       |             |  |  |       | 
|Interest rate swaps                                    |  |           | 11,917  |  |             |  | 215   |             |  |  | 187   | 
|Cross currency interest rate swaps                     |  |           | 616     |  |             |  | 4     |             |  |  | 14    | 
|                                                       |  |           |         |  |             |  |       |             | 
|Total fair value hedges                                |  |           | 12,533  |  |             |  | 219   |             |  |  | 201   | 
|Derivatives designated as cash flow hedges             |  |           |         |  |             |  |       |             |  |  |       | 
|Interest rate swaps                                    |  |           | 78,021  |  |             |  | 279   |             |  |  | 216   | 
|                                                       |  |           |         |  |             |  |       |             | 
|Total derivative assets / liabilities held for hedging |  |           | 90,554  |  |             |  | 498   |             |  |  | 417   | 
|                                                       |  |           |         |  |             |  |       |             | 
|Total recognised derivative assets / liabilities       |  |           | 236,168 |  |             |  | 2,085 |             |  |  | 1,647 | 
|                                                       |  |           |         |  |             |  |       |             | 



Trading Instruments




F-43



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                     
|-- | ----------------------------------------------------
|15 | DERIVATIVE FINANCIAL
    INSTRUMENTS     (continued)



|                                             |                             |                |         |  |       |  |         |       |   |  |  |      |  
|-------------------------------------------- | --------------------------- | -------------- | ------- |  | ----- |  | ------- | ----- | - |  |  | ---- | -
|                                             |                             | March 31, 2005 |        
|                                             |                             |                |        
|                                             |                             | Underlying     |         |  |       |  | Average |      
|                                             |                             | Principal      |         |  | Fair  |  |         | Fair  |  
|                                             |                             | Amount(1)      |         |  | Value |  |         | Value |  
|                                             |                             |                |         |  |       |  |         |       |  
|                                             |                             | m             |         |  | m    |  |         | m    |  
|Interest rate contracts:                     |                             |                |         |  |       |  |         |       |   |  |  |     
|Interest rate swaps                          |                             |                | 70,180  |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         | 785   |   |  |  | 782  |  
|                                             | in an unfavourable position |                |         |  |       |  |         | (394  | ) |  |  | (402 | )
|Interest rate caps, floors & options held    |                             |                | 10,728  |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         | 2     |   |  |  | 3    |  
|                                             | in an unfavourable position |                |         |  |       |  |         |      |   |  |  |     |  
|Interest rate caps, floors & options written |                             |                | 967     |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         | 1     |   |  |  | 1    |  
|                                             | in an unfavourable position |                |         |  |       |  |         | (1    | ) |  |  | (2   | )
|Forward rate agreements                      |                             |                | 12,361  |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         | 5     |   |  |  | 5    |  
|                                             | in an unfavourable position |                |         |  |       |  |         | (5    | ) |  |  | (4   | )
|Financial futures                            |                             |                | 3,012   |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         |      |   |  |  |     |  
|                                             | in an unfavourable position |                |         |  |       |  |         |      |   |  |  |     |  
|                                             |                             |                |         |  |       |  |         |       |  
|                                             |                             |                | 97,248  |  |       |  | 393     |       |   |  |  |     
|                                             |                             |                |         |  |       |  |         |       |  
|Foreign exchange contracts:                  |                             |                |         |  |       |  |         |       |   |  |  |     
|Forward foreign exchange                     |                             |                | 11,571  |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         | 125   |   |  |  | 127  |  
|                                             | in an unfavourable position |                |         |  |       |  |         | (91   | ) |  |  | (158 | )
|Currency Swaps                               |                             |                | 1,062   |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         | 54    |   |  |  | 33   |  
|                                             | in an unfavourable position |                |         |  |       |  |         | (32   | ) |  |  | (24  | )
|                                             |                             |                |         |  |       |  |         |       |  
|                                             |                             |                | 12,633  |  |       |  | 56      |       |   |  |  |     
|                                             |                             |                |         |  |       |  |         |       |  
|Credit Contracts:                            |                             |                |         |  |       |  |         |       |   |  |  |     
|Credit Default Swaps                         |                             |                | 60      |  |       |  |         |       |   |  |  |     
|                                             | in a favourable position    |                |         |  |       |  |         |      |   |  |  |     |  
|                                             | in an unfavourable position |                |         |  |       |  |         |      |   |  |  | (1   | )
|                                             |                             |                |         |  |       |  |         |       |  
|                                             |                             |                | 109,941 |  |       |  | 449     |       |   |  |  |     
|                                             |                             |                |         |  |       |  |         |       |  






|    |                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The underlying principal amount represents the notional amount
    upon which the instruments are based and does not generally
    represent the amounts exchanged by the parties to the
    instruments.

Non Trading Derivatives




F-44



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                     
|-- | ----------------------------------------------------
|15 | DERIVATIVE FINANCIAL
    INSTRUMENTS     (continued)









|                           |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |     |  
|-------------------------- | -------------- | -------------- | ------ | -------- | -------- |  |  | ------- |  |  | -------- | ---- |  | ----- |  | ---- |  |  | ---- | --- | -
|                           |                | March 31, 2005 |       
|                           |                |                |       
|                           |                |                |        | Weighted |          |  | 
|                           |                | Underlying     |        |          | Weighted |  |  | Average |  |  | Weighted |      |  |      
|                           |                | Principal      |        |          | Average  |  |  | Receive |  |  | Average  |      |  | Fair  | 
|                           |                | Amount         |        |          | Maturity |  |  | Rate    |  |  | Pay Rate |      |  | Value | 
|                           |                |                |        |          |          |  |  |         |  |  |          |      |  |       | 
|                           |                | m             |        |          | in Years |  |  | %       |  |  | %        |      |  | m    | 
|Interest rate contracts:   |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
|Interest Rate Swaps        |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
| receive fixed            |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
|                           | 1 year or less |                |        | 13,235   |          |  |  | 0.36    |  |  |          | 3.29 |  |       |  | 3.31 |  |  |      | 65  |  
|                           | 1-5 years      |                |        | 3,342    |          |  |  | 2.76    |  |  |          | 2.23 |  |       |  | 3.98 |  |  |      | 15  |  
|                           | 5-10 years     |                |        | 1,837    |          |  |  | 6.39    |  |  |          | 4.05 |  |       |  | 4.46 |  |  |      | (9  | )
|                           | Over 10 years  |                |        | 115      |          |  |  | 22.05   |  |  |          | 5.45 |  |       |  | 4.92 |  |  |      | 7   |  
|Interest Rate Swaps        |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
| pay fixed                |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
|                           | 1 year or less |                |        | 13,855   |          |  |  | 0.26    |  |  |          | 4.13 |  |       |  | 4.18 |  |  |      | (48 | )
|                           | 1-5 years      |                |        | 10,783   |          |  |  | 2.47    |  |  |          | 4.70 |  |       |  | 4.98 |  |  |      | (41 | )
|                           | 5-10 years     |                |        | 1,614    |          |  |  | 7.65    |  |  |          | 3.53 |  |       |  | 4.93 |  |  |      | (73 | )
|                           | Over 10 years  |                |        | 731      |          |  |  | 15.09   |  |  |          | 3.29 |  |       |  | 5.46 |  |  |      | (81 | )
|Interest Rate Swaps        |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
| pay and receive floating |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
|                           | 1 year or less |                |        | 20       |          |  |  | 0.57    |  |  |          | 2.44 |  |       |  | 2.22 |  |  |      |    |  
|                           | 1-5 years      |                |        | 390      |          |  |  | 3.32    |  |  |          | 3.19 |  |       |  | 2.83 |  |  |      | 10  |  
|                           | 5-10 years     |                |        | 122      |          |  |  | 7.32    |  |  |          | 3.79 |  |       |  | 2.23 |  |  |      | 5   |  
|                           | Over 10 years  |                |        | 254      |          |  |  | 26.57   |  |  |          | 2.20 |  |       |  | 2.20 |  |  |      | 2   |  
|Interest Rate Caps         |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
|                           | 1 year or less |                |        | 3        |          |  |  | 0.68    |  |  |          | 7.5  |  |       |  | 0.0  |  |  |      |    |  
|                           | 1-5 years      |                |        | 89       |          |  |  | 1.17    |  |  |          | 6.14 |  |       |  | 0.0  |  |  |      |    |  
|Interest Rate Floors       |                |                |        |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  |      |    
|                           | 1-5 years      |                |        | 73       |          |  |  | 1.01    |  |  |          | 5.0  |  |       |  | 0.0  |  |  |      |    |  
|                           |                |                |        |          |          |  |  |         |  |  |          |      |  |       | 
|                           |                |                | 46,463 |          |          |  |  |         |  |  |          |      |  |       |  |      |  |  | (148 | )  
|                           |                |                |        |          |          |  |  |         |  |  |          |      |  |       | 

F-45



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                     
|-- | ----------------------------------------------------
|15 | DERIVATIVE FINANCIAL
    INSTRUMENTS     (continued)

|                                   |                |                |        |       |          |  |  |       |  |  |     |     |  
|---------------------------------- | -------------- | -------------- | ------ | ----- | -------- |  |  | ----- |  |  | --- | --- | -
|                                   |                | March 31, 2005 |       
|                                   |                |                |       
|                                   |                | Underlying     |        |       | Weighted |  |  |      
|                                   |                | Principal      |        |       | Average  |  |  | Fair  | 
|                                   |                | Amount         |        |       | Maturity |  |  | Value | 
|                                   |                |                |        |       |          |  |  |       | 
|                                   |                | m             |        |       | in Years |  |  | m    | 
|Exchange rate contracts:           |                |                |        |       |          |  |  |       |  |  |     |    
|Forward Foreign Exchange           |                |                |        |       |          |  |  |       |  |  |     |    
|                                   | 1 year or less |                |        | 2,502 |          |  |  | 0.15  |  |  |     | (6  | )
|                                   | 1-5 years      |                |        | 63    |          |  |  | 1.41  |  |  |     |    |  
|Currency Swaps                     |                |                |        |       |          |  |  |       |  |  |     |    
|                                   | 1 year or less |                |        | 1,070 |          |  |  | 0.56  |  |  |     | 50  |  
|                                   | 1-5 years      |                |        | 1,896 |          |  |  | 1.55  |  |  |     | (52 | )
|                                   | 5-10 years     |                |        | 96    |          |  |  | 6.78  |  |  |     | (1  | )
|Currency Options                   |                |                |        |       |          |  |  |       |  |  |     |    
|                                   | 1 year or less |                |        | 530   |          |  |  | 0.42  |  |  |     |    |  
|                                   |                |                |        |       |          |  |  |       | 
|                                   |                |                | 6,157  |       |          |  |  |       |  |  | (9  | )  
|                                   |                |                |        |       |          |  |  |       | 
|Credit Contracts:                  |                |                |        |       |          |  |  |       |  |  |     |    
|Credit Default Swaps               |                |                |        |       |          |  |  |       |  |  |     |    
|                                   | 1-5 years      |                |        | 55    |          |  |  | 2.7   |  |  |     | 1   |  
|                                   |                |                |        |       |          |  |  |       | 
|Equity and commodity contracts:    |                |                |        |       |          |  |  |       |  |  |     |    
|Equity Index Linked Contracts held |                |                |        |       |          |  |  |       |  |  |     |    
|                                   | 1 year or less |                |        | 397   |          |  |  | 0.59  |  |  |     | (8  | )
|                                   | 1-5 years      |                |        | 3,073 |          |  |  | 2.95  |  |  |     | 40  |  
|                                   | 5-10 years     |                |        | 858   |          |  |  | 5.91  |  |  |     | 47  |  
|                                   |                |                |        |       |          |  |  |       | 
|                                   |                |                | 4,328  |       |          |  |  |       |  |  | 79  |    
|                                   |                |                |        |       |          |  |  |       | 
|                                   |                |                | 57,003 |       |          |  |  |       |  |  | (77 | )  
|                                   |                |                |        |       |          |  |  |       | 

16  LOANS AND ADVANCES TO BANKS


|                                                        |  |      |        |   |      |  |       | 
|------------------------------------------------------- |  | ---- | ------ | - | ---- |  | ----- | 
|                                                        |  | 2006 |        |   | 2005 | 
|                                                        |  |      |        |   |      | 
|                                                        |  | m   |        |   | m   | 
|Funds placed with central banks                         |  |      | 131    |   |      |  | 117   | 
|Mandatory deposit with central banks                    |  |      | 870    |   |      |  | 52    | 
|Securities purchased with agreement to resell           |  |      | 3,773  |   |      |  | 1,101 | 
|Placements with other banks                             |  |      | 5,803  |   |      |  | 7,077 | 
|                                                        |  |      |        |   |      | 
|                                                        |  |      | 10,577 |   |      |  | 8,347 | 
|Provision for impairment on loans and advances to banks |  |      | (1     | ) |      |  |      | 
|                                                        |  |      |        |   |      | 
|                                                        |  |      | 10,576 |   |      |  | 8,347 | 
|                                                        |  |      |        |   |      | 

F-46



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


17  LOANS AND ADVANCES TO CUSTOMERS


(a)  Loans and advances to customers


|                                                                                   |  |      |         |   |      |  |        |  
|---------------------------------------------------------------------------------- |  | ---- | ------- | - | ---- |  | ------ | -
|                                                                                   |  | 2006 |         |   | 2005 | 
|                                                                                   |  |      |         |   |      | 
|                                                                                   |  | m   |         |   | m   | 
|Loans and advances to customers                                                    |  |      | 98,497  |   |      |  | 77,076 |  
|Loans and advances to customers  finance leases and
    hire purchase receivables |  |      | 3,108   |   |      |  | 3,079  |  
|                                                                                   |  |      |         |   |      | 
|Gross loans and advances                                                           |  |      | 101,605 |   |      |  | 80,155 |  
|Less allowance for losses on loans and advances                                    |  |      | (359    | ) |      |  | (319   | )
|                                                                                   |  |      |         |   |      | 
|                                                                                   |  |      | 101,246 |   |      |  | 79,836 |  
|                                                                                   |  |      |         |   |      | 



|    |                                                                      
|--- | ---------------------------------------------------------------------
|(b) | Allowance for losses on loans and advances to customers and
    banks

|                                                                       |  |      |     |   |      |  |      |  
|---------------------------------------------------------------------- |  | ---- | --- | - | ---- |  | ---- | -
|                                                                       |  | 2006 |     |   | 2005 | 
|                                                                       |  |      |     |   |      | 
|                                                                       |  | m   |     |   | m   | 
|Movement in allowance for losses on loans and advances as
    follows: |  |      |     |   |      |  |      |  
|Opening balance                                                        |  |      | 319 |   |      |  | 472  |  
|Exchange adjustments                                                   |  |      | (1  | ) |      |  | (9   | )
|Implementation of IAS 32/39 on April 1, 2005                           |  |      |    |   |      |  |     |  
|Charge against profits                                                 |  |      | 100 |   |      |  | (21  | )
|Amounts written off                                                    |  |      | (85 | ) |      |  | (144 | )
|Recoveries                                                             |  |      | 21  |   |      |  | 21   |  
|Transfer of provisions to subsidiary undertakings                      |  |      |    |   |      |  |     |  
|Other movements                                                        |  |      | 6   |   |      |  |     |  
|                                                                       |  |      |     |   |      | 
|Closing balance                                                        |  |      | 360 |   |      |  | 319  |  
|                                                                       |  |      |     |   |      | 
|Of which relates to:                                                   |  |      |     |   |      |  |      |  
|Loans and advances to customers                                        |  |      | 359 |   |      |  | 319  |  
|Loans and advances to banks                                            |  |      | 1   |   |      |  |     |  
|                                                                       |  |      |     |   |      | 
|                                                                       |  |      | 360 |   |      |  | 319  |  
|                                                                       |  |      |     |   |      | 

(c)  Concentration of exposure to credit risk






 


F-47



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                    
|-- | ---------------------------------------------------
|17 | LOANS AND ADVANCES TO
    CUSTOMERS     (continued)

(d) Finance Leases




|                                                                 |  |      |       |   |      |  |       |  
|---------------------------------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | -
|                                                                 |  | 2006 |       |   | 2005 | 
|                                                                 |  |      |       |   |      | 
|                                                                 |  | m   |       |   | m   | 
|Gross investment in finance leases:                              |  |      |       |   |      |  |       |  
|Not later than 1 year                                            |  |      | 1,513 |   |      |  | 1,419 |  
|Later than 1 year and not later than 5 years                     |  |      | 1,708 |   |      |  | 1,788 |  
|Later than 5 years                                               |  |      | 212   |   |      |  | 207   |  
|                                                                 |  |      |       |   |      | 
|                                                                 |  |      | 3,433 |   |      |  | 3,414 |  
|                                                                 |  |      |       |   |      | 
|Unguaranteed residual values accruing to the lessor              |  |      |      |   |      |  |       |  
|Unearned future finance income on finance leases                 |  |      | (325  | ) |      |  | (335  | )
|                                                                 |  |      |       |   |      | 
|Net investment in finance leases                                 |  |      | 3,108 |   |      |  | 3,079 |  
|                                                                 |  |      |       |   |      | 
|The net investment in finance leases may be analysed as follows: |  |      |       |   |      |  |       |  
|Not later than 1 year                                            |  |      | 1,373 |   |      |  | 1,288 |  
|Later than 1 year and not later than 5 years                     |  |      | 1,540 |   |      |  | 1,594 |  
|Later than 5 years                                               |  |      | 195   |   |      |  | 197   |  
|                                                                 |  |      |       |   |      | 
|                                                                 |  |      | 3,108 |   |      |  | 3,079 |  
|                                                                 |  |      |       |   |      | 



|   |                                    
|-- | -----------------------------------
|18 | AVAILABLE FOR SALE FINANCIAL ASSETS



|                                         |            |      |        |        |      |  |   |   | 
|---------------------------------------- | ---------- | ---- | ------ | ------ | ---- |  | - | - | 
|                                         |            | 2006 |        |        | 2005 | 
|                                         |            |      |        |        |      | 
|                                         |            | m   |        |        | m   | 
|Investment Securities available-for-sale |            |      |        |        |      |  |   |  
|Government bonds                         |            |      | 5,881  |        |      |  |  |  
|Other debt securities                    |            |      |        |        |      |  |   |  
|                                         |  Listed   |      |        | 20,062 |      |  |   |  | 
|                                         |  Unlisted |      |        | 2,237  |      |  |   |  | 
|Equity securities                        |            |      |        |        |      |  |   |  
|                                         |  Listed   |      |        | 3      |      |  |   |  | 
|                                         |  Unlisted |      |        | 22     |      |  |   |  | 
|                                         |            |      |        |        |      | 
|Total securities available-for-sale      |            |      | 28,205 |        |      |  |  |  
|                                         |            |      |        |        |      | 

 


F-48



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                 
|-- | ------------------------------------------------
|18 | AVAILABLE FOR SALE FINANCIAL ASSETS  (continued)



|                                            |  |    |         |  
|------------------------------------------- |  | -- | ------- | -
|                                            |  | m |        
|At April 1, 2005                            |  |    | 20,752  |  
|Revaluation, exchange and other adjustments |  |    | 150     |  
|Additions                                   |  |    | 27,784  |  
|Disposals (sale and redemption)             |  |    | (20,576 | )
|Amortisation                                |  |    | 98      |  
|Provision for impairment                    |  |    | (3      | )
|                                            |  |    |        
|At March 31, 2006                           |  |    | 28,205  |  
|                                            |  |    |        



|   |                
|-- | ---------------
|19 | DEBT SECURITIES

F-92 F-95 F-104.


|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |     |   |  |        |        | 
|----------------------- | --------------------------------------------------- | ----------------- | ------ | ------ | ---------- |  | ----- | ---------- |  |  | ----- | --- | - |  | ------ | ------ | 
|                        |                                                     | At March 31, 2005 |       
|                        |                                                     |                   |       
|                        |                                                     |                   |        | Gross  |            |  | Gross |            |  | 
|                        |                                                     | Book              |        |        | Unrealised |  |       | Unrealised |  |  | Fair  |    
|                        |                                                     | Value             |        |        | Gains      |  |       | Losses     |  |  | Value |    
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|                        |                                                     | m                |        |        | m         |  |       | m         |  |  | m    |    
|Issued by public bodies |                                                     |                   |        |        |            |  |       |            |  |  |       |     |   |  |        |       
|Investment securities   |                                                     |                   |        |        |            |  |       |            |  |  |       |     |   |  |        |       
|                        |  government securities                             |                   |        | 394    |            |  |       | 17         |  |  |       | (4  | ) |  |        | 407    | 
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|Other securities        |                                                     |                   |        |        |            |  |       |            |  |  |       |     |   |  |        |       
|                        |  government securities                             |                   |        | 5,774  |            |  |       |            |  |  |       |     |   |  |        | 5,774  | 
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|                        |                                                     |                   | 5,774  |        |            |  |       |            |  |  |       |     |   |  | 5,774  |       
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|Issued by other issuers |                                                     |                   |        |        |            |  |       |            |  |  |       |     |   |  |        |       
|Investment securities   |                                                     |                   |        |        |            |  |       |            |  |  |       |     |   |  |        |       
|                        |  bank and building society certificates of deposit |                   |        | 1,126  |            |  |       | 12         |  |  |       |    |   |  |        | 1,138  | 
|                        |  other debt securities                             |                   |        | 13,556 |            |  |       | 100        |  |  |       | (43 | ) |  |        | 13,613 | 
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|                        |                                                     |                   | 14,682 |        |            |  | 112   |            |  |  | (43   | )   |   |  | 14,751 |       
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|Other securities        |                                                     |                   |        |        |            |  |       |            |  |  |       |     |   |  |        |       
|                        |  bank and building society certificates of deposit |                   |        |       |            |  |       |            |  |  |       |     |   |  |        |       | 
|                        |  other debt securities                             |                   |        | 471    |            |  |       |            |  |  |       |     |   |  |        | 471    | 
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|                        |                                                     |                   | 471    |        |            |  |       |            |  |  |       |     |   |  | 471    |       
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    
|                        |                                                     |                   | 21,321 |        |            |  | 129   |            |  |  | (47   | )   |   |  | 21,403 |       
|                        |                                                     |                   |        |        |            |  |       |            |  |  |       |    

F-49



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|20 | INTEREST IN ASSOCIATED UNDERTAKINGS

|                           |  |      |    |   |      |  |    |  
|-------------------------- |  | ---- | -- | - | ---- |  | -- | -
|                           |  | 2006 |    |   | 2005 | 
|                           |  |      |    |   |      | 
|                           |  | m   |    |   | m   | 
|At April 1,                |  |      | 17 |   |      |  | 14 |  
|Share of results after tax |  |      | 5  |   |      |  | (1 | )
|Increase in investments    |  |      | 4  |   |      |  | 5  |  
|Decrease in investments    |  |      | (5 | ) |      |  | (1 | )
|                           |  |      |    |   |      | 
|At March 31,               |  |      | 21 |   |      |  | 17 |  
|                           |  |      |    |   |      | 





|   |                           
|-- | --------------------------
|21 | INTEREST IN JOINT VENTURES

|                               |  |      |     |   |      |  |      |  
|------------------------------ |  | ---- | --- | - | ---- |  | ---- | -
|                               |  | 2006 |     |   | 2005 | 
|                               |  |      |     |   |      | 
|                               |  | m   |     |   | m   | 
|At April 1,                    |  |      | 61  |   |      |  | 243  |  
|Disposals                      |  |      |    |   |      |  | (4   | )
|Share of results after tax     |  |      | 40  |   |      |  | 31   |  
|Exchange adjustments           |  |      | (1  | ) |      |  | (9   | )
|Dividends received             |  |      | (25 | ) |      |  | (14  | )
|Transfer to Group undertakings |  |      |    |   |      |  | (186 | )
|                               |  |      |     |   |      | 
|At March 31,                   |  |      | 75  |   |      |  | 61   |  
|                               |  |      |     |   |      | 



| |                         |                             
| | ----------------------- | ----------------------------
| | The joint ventures are: | First Rate Exchange Services





F-50



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                  
|-- | -----------------
|22 | INTANGIBLE ASSETS

|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |   |  |  |       |  
|------------------------------------------------------------ |  | -------- | --- | - | ----------------- | ---------------- | ---- | ----------- |  |  | ----- | - |  |  | ----- | -
|                                                             |  |          |     |   |                   | Other externally |      |             | 
|                                                             |  |          |     |   |                   | purchased        |      |             | 
|                                                             |  | Goodwill |     |   | Computer Software |                  |      | intangibles |  |  | Total |  
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|                                                             |  | m       |     |   | m                |                  |      | m          |  |  | m    |  
|Cost                                                         |  |          |     |   |                   |                  |      |             |  |  |       |   |  |  |       |  
|At April 1, 2005                                             |  |          | 219 |   |                   |                  | 868  |             |  |  | 124   |   |  |  | 1,211 |  
|Implementation of IAS 32/39 as at April 1, 2005              |  |          | 53  |   |                   |                  |     |             |  |  |      |   |  |  | 53    |  
|Goodwill/intangibles arising on acquisitions during the year |  |          | 92  |   |                   |                  |     |             |  |  | 23    |   |  |  | 115   |  
|Exchange adjustments                                         |  |          | 11  |   |                   |                  | (2   | )           |  |  | (1    | ) |  |  | 8     |  
|Reclassifications                                            |  |          |    |   |                   |                  | 14   |             |  |  |      |   |  |  | 14    |  
|Additions                                                    |  |          |    |   |                   |                  | 106  |             |  |  |      |   |  |  | 106   |  
|Disposals                                                    |  |          |    |   |                   |                  | (16  | )           |  |  |      |   |  |  | (16   | )
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|At March 31, 2006                                            |  |          | 375 |   |                   |                  | 970  |             |  |  | 146   |   |  |  | 1,491 |  
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|Accumulated impairment and amortisation losses               |  |          |     |   |                   |                  |      |             |  |  |       |   |  |  |       |  
|At April 1, 2005                                             |  |          |    |   |                   |                  | (404 | )           |  |  | (15   | ) |  |  | (419  | )
|Exchange adjustments                                         |  |          |    |   |                   |                  |     |             |  |  | 1     |   |  |  | 1     |  
|Reclassifications                                            |  |          |    |   |                   |                  | (10  | )           |  |  |      |   |  |  | (10   | )
|Disposals                                                    |  |          |    |   |                   |                  | 8    |             |  |  |      |   |  |  | 8     |  
|Charge for period                                            |  |          |    |   |                   |                  | (93  | )           |  |  | (13   | ) |  |  | (106  | )
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|At March 31, 2006                                            |  |          |    |   |                   |                  | (499 | )           |  |  | (27   | ) |  |  | (526  | )
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|Net Book Value                                               |  |          | 375 |   |                   |                  | 471  |             |  |  | 119   |   |  |  | 965   |  
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|Cost                                                         |  |          |     |   |                   |                  |      |             |  |  |       |   |  |  |       |  
|At April 1, 2004                                             |  |          | 147 |   |                   |                  | 733  |             |  |  | 44    |   |  |  | 924   |  
|Goodwill arising on acquisitions during the year             |  |          | 81  |   |                   |                  |     |             |  |  |      |   |  |  | 81    |  
|Additions                                                    |  |          |    |   |                   |                  | 138  |             |  |  | 80    |   |  |  | 218   |  
|Exchange adjustments                                         |  |          | (6  | ) |                   |                  | (3   | )           |  |  |      |   |  |  | (9    | )
|Impairment loss reversed in equity                           |  |          | (3  | ) |                   |                  |     |             |  |  |      |   |  |  | (3    | )
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|At March 31, 2005                                            |  |          | 219 |   |                   |                  | 868  |             |  |  | 124   |   |  |  | 1,211 |  
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|Accumulated amortisation and impairment losses               |  |          |     |   |                   |                  |      |             |  |  |       |   |  |  |       |  
|At April 1, 2004                                             |  |          |    |   |                   |                  | (320 | )           |  |  |      |   |  |  | (320  | )
|Amortisation charge for year                                 |  |          |    |   |                   |                  | (86  | )           |  |  | (15   | ) |  |  | (101  | )
|Exchange adjustments                                         |  |          |    |   |                   |                  | 2    |             |  |  |      |   |  |  | 2     |  
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|At March 31, 2005                                            |  |          |    |   |                   |                  | (404 | )           |  |  | (15   | ) |  |  | (419  | )
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  
|Net Book Value                                               |  |          | 219 |   |                   |                  | 464  |             |  |  | 109   |   |  |  | 792   |  
|                                                             |  |          |     |   |                   |                  |      |             |  |  |       |  

F-51



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                               
|-- | ------------------------------
|22 | INTANGIBLE ASSETS  (continued)

Intangible Assets Impairment Review


|                             |  |             |  |          |     |  |      |  |     |                    |  |  |                 |  |  |                
|---------------------------- |  | ----------- |  | -------- | --- |  | ---- |  | --- | ------------------ |  |  | --------------- |  |  | ---------------
|                             |  |             |  | Goodwill |     |  |      |  |    
|                             |  |             |  |          |     |  |      |  |    
|Division                     |  | Acquisition |  | 2006     |     |  | 2005 |  |     | Basis of Valuation |  |  | Key Assumptions
|                             |  |             |  |          |     |  |      |  |     |                    |  |  |                
|                             |  |             |  | m       |     |  | m   |  |     |                    |  | 
|AMS                          |  | Iridian     |  |          | 219 |  |      |  | 156 |                    |  |  | Earnings        |  |  | Constant growth
|AMS                          |  | Guggenheim  |  |          | 92  |  |      |  |    |                    |  |  | Earnings        |  |  | rate after     
|Wholesale Financial Services |  | Burdale     |  |          | 54  |  |      |  | 55  |                    |  |  | Earnings        |  |  | year 5         







|   |                              
|-- | -----------------------------
|23 | PROPERTY, PLANT AND EQUIPMENT

|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       |  |     |   |  |  |       |  
|----------------------------------------- |  | ------------------ | --- | - | ----------- |  | --------- | --------- |  | ----------- | --------- | - | ------------- | ------------ | -- | - | ----- |  | --- | - |  |  | ----- | -
|                                          |  |                    |     |   |             |  |           |           |  | Payments on |           |   |              
|                                          |  |                    |     |   |             |  |           |           |  | account and |           |   |              
|                                          |  | Freehold land and  |     |   |             |  | Computer  |           |  | Finance     |           |   | assets in the |              |    |  
|                                          |  | buildings and long |     |   |             |  | and other |           |  | lease       |           |   | course of     |              |    |  
|                                          |  | leaseholds         |     |   | Adaptations |  |           | equipment |  |             | assets    |   |               | construction |    |   |      
|                                          |  | (at valuation)     |     |   | (at cost)   |  |           | (at cost) |  |             | (at cost) |   |               | (at cost)    |    |   | Total | 
|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       | 
|                                          |  | m                 |     |   | m          |  |           | m        |  |             | m        |   |               | m           |    |   | m    | 
|Cost or valuation                         |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       |  |     |   |  |  |       |  
|At April 1, 2005                          |  |                    | 440 |   |             |  | 120       |           |  |             | 682       |   |               |              | 10 |   |       |  | 28  |   |  |  | 1,280 |  
|Exchange adjustments                      |  |                    | (1  | ) |             |  |          |           |  |             | (2        | ) |               |              |   |   |       |  |    |   |  |  | (3    | )
|Additions                                 |  |                    | 16  |   |             |  | 4         |           |  |             | 24        |   |               |              |   |   |       |  | 6   |   |  |  | 50    |  
|Disposals                                 |  |                    | (39 | ) |             |  | (7        | )         |  |             | (51       | ) |               |              |   |   |       |  |    |   |  |  | (97   | )
|Revaluation                               |  |                    | 212 |   |             |  |          |           |  |             |          |   |               |              |   |   |       |  |    |   |  |  | 212   |  
|Reclassifications                         |  |                    | (1  | ) |             |  | 7         |           |  |             | 23        |   |               |              |   |   |       |  | (28 | ) |  |  | 1     |  
|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       | 
|At March 31, 2006                         |  |                    | 627 |   |             |  | 124       |           |  |             | 676       |   |               |              | 10 |   |       |  | 6   |   |  |  | 1,443 |  
|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       | 
|Accumulated depreciation and amortisation |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       |  |     |   |  |  |       |  
|At April 1, 2005                          |  |                    |    |   |             |  | (22       | )         |  |             | (531      | ) |               |              | (7 | ) |       |  |    |   |  |  | (560  | )
|Exchange adjustments                      |  |                    |    |   |             |  |          |           |  |             | 2         |   |               |              |   |   |       |  |    |   |  |  | 2     |  
|Disposals                                 |  |                    |    |   |             |  | 3         |           |  |             | 42        |   |               |              |   |   |       |  |    |   |  |  | 45    |  
|Charge for year                           |  |                    |    |   |             |  | (15       | )         |  |             | (44       | ) |               |              | (1 | ) |       |  |    |   |  |  | (60   | )
|Reclassifications                         |  |                    |    |   |             |  | 1         |           |  |             | (11       | ) |               |              |   |   |       |  |    |   |  |  | (10   | )
|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       | 
|At March 31, 2006                         |  |                    |    |   |             |  | (33       | )         |  |             | (542      | ) |               |              | (8 | ) |       |  |    |   |  |  | (583  | )
|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       | 
|Net book value At March 31, 2006          |  |                    | 627 |   |             |  | 91        |           |  |             | 134       |   |               |              | 2  |   |       |  | 6   |   |  |  | 860   |  
|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       | 
|At March 31, 2005                         |  |                    | 440 |   |             |  | 98        |           |  |             | 151       |   |               |              | 3  |   |       |  | 28  |   |  |  | 720   |  
|                                          |  |                    |     |   |             |  |           |           |  |             |           |   |               |              |    |   |       | 

F-52



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                           
|-- | ------------------------------------------
|23 | PROPERTY, PLANT AND EQUIPMENT  (continued)

Property and Equipment




|                           |                                                  |      |  |    |      |  |  |    | 
|-------------------------- | ------------------------------------------------ | ---- |  | -- | ---- |  |  | -- | 
|                           |                                                  | 2006 |  |    | 2005 | 
|                           |                                                  |      |  |    |      | 
|                           |                                                  | m   |  |    | m   | 
|Future capital expenditure |                                                  |      |  |    |      |  |  |   
|                           |  contracted but not provided in the accounts    |      |  | 17 |      |  |  | 10 | 
|                           |  authorised by the Directors but not contracted |      |  | 28 |      |  |  | 14 | 



|                                             |  |         |     |  |            |  |   | 
|-------------------------------------------- |  | ------- | --- |  | ---------- |  | - | 
|                                             |  | Payable |     |  | Receivable | 
|                                             |  |         |     |  |            | 
|                                             |  | m      |     |  | m         | 
|Year ended 31 March                          |  |         |     |  |            |  |   | 
|Not later than 1 year                        |  |         | 48  |  |            |  | 3 | 
|Later than 1 year and not later than 5 years |  |         | 161 |  |            |  | 5 | 
|Later than 5 years                           |  |         | 542 |  |            |  | 2 | 



|   |             
|-- | ------------
|24 | OTHER ASSETS

|                                                    |  |      |       |  |      |  |       | 
|--------------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                                                    |  | 2006 |       |  | 2005 | 
|                                                    |  |      |       |  |      | 
|                                                    |  | m   |       |  | m   | 
|Foreign exchange and interest rate contracts        |  |      |      |  |      |  | 1,849 | 
|Sundry debtors & other                              |  |      | 2,045 |  |      |  | 1,665 | 
|Value of life assurance business in force (Note 45) |  |      | 513   |  |      |  | 751   | 
|Accounts receivable and prepayments                 |  |      | 889   |  |      |  | 933   | 
|                                                    |  |      |       |  |      | 
|                                                    |  |      | 3,447 |  |      |  | 5,198 | 
|                                                    |  |      |       |  |      | 



|   |                  
|-- | -----------------
|25 | DEPOSITS BY BANKS

|                                              |  |      |        |  |      |  |        | 
|--------------------------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|                                              |  | 2006 |        |  | 2005 | 
|                                              |  |      |        |  |      | 
|                                              |  | m   |        |  | m   | 
|Securities sold under agreement to repurchase |  |      | 9,927  |  |      |  | 3,326  | 
|Deposits from other banks                     |  |      | 21,896 |  |      |  | 16,897 | 
|Other bank borrowings                         |  |      | 489    |  |      |  | 642    | 
|                                              |  |      |        |  |      | 
|                                              |  |      | 32,312 |  |      |  | 20,865 | 
|                                              |  |      |        |  |      | 
|Of which:                                     |  |      |        |  |      |  |        | 
|Domestic                                      |  |      | 29,944 |  |      |  | 19,586 | 
|Foreign                                       |  |      | 2,368  |  |      |  | 1,279  | 
|                                              |  |      |        |  |      | 
|                                              |  |      | 32,312 |  |      |  | 20,865 | 
|                                              |  |      |        |  |      | 

F-53



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                  
|-- | -----------------
|26 | CUSTOMER ACCOUNTS

|                                                            |  |      |        |  |      |  |        | 
|----------------------------------------------------------- |  | ---- | ------ |  | ---- |  | ------ | 
|                                                            |  | 2006 |        |  | 2005 | 
|                                                            |  |      |        |  |      | 
|                                                            |  | m   |        |  | m   | 
|Current accounts                                            |  |      | 15,876 |  |      |  | 13,422 | 
|Demand deposits                                             |  |      | 18,344 |  |      |  | 21,316 | 
|Term deposits and other products                            |  |      | 25,877 |  |      |  | 24,785 | 
|Other short term borrowings                                 |  |      | 1,373  |  |      |  | 662    | 
|Securities sold under agreement to repurchase               |  |      | 240    |  |      |  |       | 
|                                                            |  |      |        |  |      | 
|                                                            |  |      | 61,710 |  |      |  | 60,185 | 
|                                                            |  |      |        |  |      | 
|Of which:                                                   |  |      |        |  |      |  |        | 
|Non interest bearing current accounts                       |  |      |        |  |      |  |        | 
|Domestic                                                    |  |      | 11,065 |  |      |  | 9,001  | 
|Foreign                                                     |  |      | 1,057  |  |      |  | 944    | 
|                                                            |  |      |        |  |      | 
|                                                            |  |      | 12,122 |  |      |  | 9,945  | 
|                                                            |  |      |        |  |      | 
|Interest bearing current accounts and short term borrowings |  |      |        |  |      |  |        | 
|Domestic                                                    |  |      | 30,066 |  |      |  | 27,855 | 
|Foreign                                                     |  |      | 19,522 |  |      |  | 22,385 | 
|                                                            |  |      |        |  |      | 
|                                                            |  |      | 49,588 |  |      |  | 50,240 | 
|                                                            |  |      |        |  |      | 



|   |                         
|-- | ------------------------
|27 | DEBT SECURITIES IN ISSUE

|                               |  |      |        |  |      |  |        | 
|------------------------------ |  | ---- | ------ |  | ---- |  | ------ | 
|                               |  | 2006 |        |  | 2005 | 
|                               |  |      |        |  |      | 
|                               |  | m   |        |  | m   | 
|Bonds & medium term notes      |  |      | 20,249 |  |      |  | 6,956  | 
|Other debt securities in issue |  |      | 16,565 |  |      |  | 14,261 | 
|                               |  |      |        |  |      | 
|                               |  |      | 36,814 |  |      |  | 21,217 | 
|                               |  |      |        |  |      | 

F-54



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                         
|-- | ------------------------
|28 | SUBORDINATED LIABILITIES

|                                |                                                                                                             |      |       |     |      |  |       |     | 
|------------------------------- | ----------------------------------------------------------------------------------------------------------- | ---- | ----- | --- | ---- |  | ----- | --- | 
|                                |                                                                                                             | 2006 |       |     | 2005 | 
|                                |                                                                                                             |      |       |     |      | 
|                                |                                                                                                             | m   |       |     | m   | 
|Undated Loan Capital            |                                                                                                             |      |       |     |      |  |       |    
|Bank of Ireland                 |                                                                                                             |      |       |     |      |  |       |    
|                                | U.S.$150m Undated Floating Rate Primary Capital Notes                                                       |      |       |    |      |  |       | 114 | 
|Bank of Ireland UK Holdings plc |                                                                                                             |      |       |     |      |  |       |    
|                                | 600m 7.40%
    Guaranteed Step-up Callable Perpetual Preferred Securities                                  |      |       | 636 |      |  |       | 596 | 
|                                | Stg£350m 6.25% Guaranteed Callable Perpetual Preferred
    Securities                                       |      |       | 461 |      |  |       | 503 | 
|BOI Capital Funding (No 1) LP   |                                                                                                             |      |       |     |      |  |       |    
|                                | 600m Fixed Rate/
    Variable Rate Guaranteed Non-voting Non-Cumulative Perpetual
    Preferred Securities |      |       | 588 |      |  |       | 587 | 
|BOI Capital Funding (No 2) LP   |                                                                                                             |      |       |     |      |  |       |    
|                                | U.S.$800m Fixed Rate/ Variable Rate Guaranteed Non-voting
    Non-Cumulative Perpetual Preferred Securities |      |       | 627 |      |  |       |    | 
|BOI Capital Funding (No 3) LP   |                                                                                                             |      |       |     |      |  |       |    
|                                | U.S.$400m Fixed Rate/ Variable Rate Guaranteed Non-voting
    Non-Cumulative Perpetual Preferred Securities |      |       | 318 |      |  |       |    | 
|Bristol & West                  |                                                                                                             |      |       |     |      |  |       |    
|                                | Stg£75m
    133/8%
    Perpetual Subordinated Bonds                                                         |      |       | 178 |      |  |       | 180 | 
|                                | Stg£50.4m
    81/8 per
    cent Non-Cumulative Preference Shares                                            |      |       | 72  |      |  |       |    | 
|                                |                                                                                                             |      |       |     |      | 
|                                |                                                                                                             |      | 2,880 |     |      |  | 1,980 |    
|                                |                                                                                                             |      |       |     |      | 
|Dated loan capital              |                                                                                                             |      |       |     |      |  |       |    
|Bank of Ireland                 |                                                                                                             |      |       |     |      |  |       |    
|                                | 750m 6.45%
    Subordinated Bonds 2010                                                                     |      |       | 798 |      |  |       | 748 | 
|                                | 600m
    Subordinated Floating Rate Notes 2013                                                             |      |       | 595 |      |  |       | 599 | 
|                                | 650m Fixed/
    Floating Rate Subordinated Notes 2019                                                      |      |       | 662 |      |  |       | 650 | 
|                                | 600m
    Subordinated Floating Rate Notes due 2017                                                         |      |       | 598 |      |  |       |    | 
|                                | Can$400m Fixed/ Floating Rate Subordinated Notes 2015                                                       |      |       | 275 |      |  |       |    | 
|                                | Stg£400m Fixed/ Floating Rate Subordinated Notes 2018                                                       |      |       | 570 |      |  |       |    | 
|Bristol & West                  |                                                                                                             |      |       |     |      |  |       |    
|                                | Stg£75m
    103/4%
    Subordinated Bonds 2018                                                              |      |       | 115 |      |  |       | 109 | 
|                                |                                                                                                             |      |       |     |      | 
|                                |                                                                                                             |      | 3,613 |     |      |  | 2,106 |    
|                                |                                                                                                             |      |       |     |      | 
|                                |                                                                                                             |      | 6,493 |     |      |  | 4,086 |    
|                                |                                                                                                             |      |       |     |      | 



 Step-up




F-55



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                      
|-- | -------------------------------------
|28 | SUBORDINATED LIABILITIES  (continued)













 Non-voting Non-cumulative








F-56



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                      
|-- | -------------------------------------
|28 | SUBORDINATED LIABILITIES  (continued)



non-cumulative




Non-voting Non-cumulative




three-month








F-57



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                      
|-- | -------------------------------------
|28 | SUBORDINATED LIABILITIES  (continued)

Non-voting Non-cumulative




three-month




non-cumulative




3 8


1 8 Non-Cumulative Non-Equity


   




F-58



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                      
|-- | -------------------------------------
|28 | SUBORDINATED LIABILITIES  (continued)

non-cumulative




   


       





Inter-Bank






|   |                  
|-- | -----------------
|29 | OTHER LIABILITIES

|                                             |  |      |       |  |      |  |       | 
|-------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                                             |  | 2006 |       |  | 2005 | 
|                                             |  |      |       |  |      | 
|                                             |  | m   |       |  | m   | 
|Current taxation                             |  |      | 75    |  |      |  | 91    | 
|Notes in circulation                         |  |      | 791   |  |      |  | 785   | 
|Foreign exchange and interest rate contracts |  |      |      |  |      |  | 1,831 | 
|Sundry creditors                             |  |      | 1,792 |  |      |  | 1,931 | 
|Other                                        |  |      | 1,131 |  |      |  | 1,349 | 
|Accruals and deferred income                 |  |      | 922   |  |      |  | 770   | 
|                                             |  |      |       |  |      | 
|                                             |  |      | 4,711 |  |      |  | 6,757 | 
|                                             |  |      |       |  |      | 



F-59



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |           
|-- | ----------
|30 | PROVISIONS

|                                                  |  |      |     |   |      |  |     |  
|------------------------------------------------- |  | ---- | --- | - | ---- |  | --- | -
|                                                  |  | 2006 |     |   | 2005 | 
|                                                  |  |      |     |   |      | 
|                                                  |  | m   |     |   | m   | 
|At April 1,                                       |  |      | 179 |   |      |  | 63  |  
|Exchange differences                              |  |      | (1  | ) |      |  | (2  | )
|Additional provisions charged to income statement |  |      | 47  |   |      |  | 164 |  
|Utilised during year                              |  |      | (64 | ) |      |  | (23 | )
|Unused amounts reversed during the period         |  |      |    |   |      |  | (23 | )
|Other movements                                   |  |      | (8  | ) |      |  |    |  
|                                                  |  |      |     |   |      | 
|At 31 March                                       |  |      | 153 |   |      |  | 179 |  
|                                                  |  |      |     |   |      | 

 


F-60



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                      
|-- | ---------------------
|31 | DEFERRED INCOME TAXES

|                                                                                        |                                  |      |     |    |      |  |     |    | 
|--------------------------------------------------------------------------------------- | -------------------------------- | ---- | --- | -- | ---- |  | --- | -- | 
|                                                                                        |                                  | 2006 |     |    | 2005 | 
|                                                                                        |                                  |      |     |    |      | 
|                                                                                        |                                  | m   |     |    | m   | 
|The movement on the deferred income tax account is as follows                           |                                  |      |     |    |      |  |     |   
|Opening balance                                                                         |                                  |      | 113 |    |      |  | 118 |   
|Income Statement Charge for Year                                                        |                                  |      | 41  |    |      |  | 53  |   
|Available for Sale Securities  Fair Value Gain on
    transition as at April 1, 2005   |                                  |      | 18  |    |      |  |    |   
|Available for Sale Securities  Transferred to Net
    Profit                           |                                  |      | (15 | )  |      |  |    |   
|Cash Flow Hedges  Fair Value Gain on transition as at
    April 1, 2005                |                                  |      | 12  |    |      |  |    |   
|Cash Flow Hedges  Transferred to Net Profit                                            |                                  |      | (1  | )  |      |  |    |   
|Revaluation of Property During Year                                                     |                                  |      | 25  |    |      |  | 5   |   
|Other Movements                                                                         |                                  |      | (16 | )  |      |  | (63 | ) 
|                                                                                        |                                  |      |     |    |      | 
|Closing balance                                                                         |                                  |      | 177 |    |      |  | 113 |   
|                                                                                        |                                  |      |     |    |      | 
|(See Note 39 for further information on deferred tax
    charged directly to equity)    |                                  |      |     |    |      |  |     |   
|Deferred income tax assets and liabilities are attributable to
    the following items: |                                  |      |     |    |      |  |     |   
|Deferred Tax Liabilities                                                                |                                  |      |     |    |      |  |     |   
|Accelerated Capital Allowances:                                                         |                                  |      |     |    |      |  |     |   
|                                                                                        |  on finance leases              |      |     | 62 |      |  |     | 80 | 
|                                                                                        |  on equipment used by the Group |      |     | 26 |      |  |     | 26 | 
|Available for Sale Securities                                                           |                                  |      | 3   |    |      |  |    |   
|Cash Flow Hedges                                                                        |                                  |      | 11  |    |      |  |    |   
|Property Revaluation Surplus                                                            |                                  |      | 69  |    |      |  | 44  |   
|Life Companies                                                                          |                                  |      | 134 |    |      |  | 123 |   
|Other temporary differences                                                             |                                  |      | 22  |    |      |  | 9   |   
|                                                                                        |                                  |      |     |    |      | 
|Deferred Tax Liabilities                                                                |                                  |      | 327 |    |      |  | 282 |   
|                                                                                        |                                  |      |     |    |      | 
|Deferred Tax Assets                                                                     |                                  |      |     |    |      |  |     |   
|Pensions and Other Post Retirement Benefits                                             |                                  |      | 116 |    |      |  | 130 |   
|Provision for Loan Impairment                                                           |                                  |      | 6   |    |      |  | 24  |   
|Other provisions                                                                        |                                  |      | 15  |    |      |  | 13  |   
|Other                                                                                   |                                  |      | 13  |    |      |  | 2   |   
|                                                                                        |                                  |      |     |    |      | 
|Deferred Tax Assets                                                                     |                                  |      | 150 |    |      |  | 169 |   
|                                                                                        |                                  |      |     |    |      | 
|Represented on the balance sheet as follows:                                            |                                  |      |     |    |      |  |     |   
|Deferred tax assets                                                                     |                                  |      | (30 | )  |      |  | (99 | ) 
|Deferred tax liabilities                                                                |                                  |      | 207 |    |      |  | 212 |   
|                                                                                        |                                  |      |     |    |      | 
|                                                                                        |                                  |      | 177 |    |      |  | 113 |   
|                                                                                        |                                  |      |     |    |      | 

F-61



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                   
|-- | ----------------------------------
|31 | DEFERRED INCOME TAXES  (continued)



|                                            |  |      |    |   |      |  |    |  
|------------------------------------------- |  | ---- | -- | - | ---- |  | -- | -
|                                            |  | 2006 |    |   | 2005 | 
|                                            |  |      |    |   |      | 
|                                            |  | m   |    |   | m   | 
|Accelerated Tax Depreciation                |  |      | (8 | ) |      |  | 3  |  
|Pensions and other post Retirement Benefits |  |      |   |   |      |  | 4  |  
|Provision for Loan Losses                   |  |      | (1 | ) |      |  | 26 |  
|Other Provisions                            |  |      | (2 | ) |      |  | (1 | )
|Other Temporary Differences                 |  |      | 52 |   |      |  | 21 |  
|                                            |  |      |    |   |      | 
|                                            |  |      | 41 |   |      |  | 53 |  
|                                            |  |      |    |   |      | 



|   |                   
|-- | ------------------
|32 | INTEREST RATE RISK







F-62



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                
|-- | -------------------------------
|32 | INTEREST RATE RISK  (continued)



Non Trading Interest Rate Repricing  Total


|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |   |  |  |       |   |  |  |         | 
|---------------------------------------------------- |  | --------------- | ------- | ------------ | ---------- |  | ---------- | --------- |  | -------- | ---------- | - |  | ---------- | ------- | --- | -------- |  | ------ | ------- |  |  | ------- | - |  |  | ----- | - |  |  | ------- | 
|                                                     |  | 31 March 2006   |        
|                                                     |  |                 |        
|                                                     |  |                 |         | Over         |            |  | Over       |           |  | Over     |            |   | 
|                                                     |  |                 |         | three months |            |  | six months |           |  | one year |            |   | 
|                                                     |  | Not             |         |              | but not    |  |            | but not   |  |          | but not    |   |  |            |         | Non |          |  |       
|                                                     |  | more than       |         |              | more than  |  |            | more than |  |          | more than  |   |  | Over       |         |     | interest |  |        | Trading |  |  |        
|                                                     |  | three months    |         |              | six months |  |            | one year  |  |          | five years |   |  | five years |         |     | bearing  |  |        | Book    |  |  | Total   |  
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|                                                     |  | (in  millions) |        
|Assets                                               |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |   |  |  |       |   |  |  |         | 
|Cash and balances with central banks                 |  |                 | 1,615   |              |            |  |           |           |  |          |           |   |  |            |        |     |          |  |       |         |  |  | 284     |   |  |  |      |   |  |  | 1,899   | 
|Central Government bills and other eligible bills    |  |                 | 8       |              |            |  |           |           |  |          |           |   |  |            |        |     |          |  |       |         |  |  |        |   |  |  |      |   |  |  | 8       | 
|Trading securities                                   |  |                 |        |              |            |  |           |           |  |          |           |   |  |            |        |     |          |  |       |         |  |  |        |   |  |  | 620   |   |  |  | 620     | 
|Loans and advances to banks                          |  |                 | 7,777   |              |            |  | 1,434      |           |  |          | 454        |   |  |            | 51      |     |          |  |       |         |  |  | 860     |   |  |  |      |   |  |  | 10,576  | 
|Derivative financial instruments                     |  |                 |        |              |            |  |           |           |  |          |           |   |  |            |        |     |          |  |       |         |  |  | 552     |   |  |  | 1,533 |   |  |  | 2,085   | 
|Loans and advances to customers                      |  |                 | 67,640  |              |            |  | 3,874      |           |  |          | 5,382      |   |  |            | 21,153  |     |          |  | 2,966  |         |  |  | 231     |   |  |  |      |   |  |  | 101,246 | 
|Investment Securities  AFS                          |  |                 | 17,781  |              |            |  | 2,260      |           |  |          | 2,164      |   |  |            | 3,892   |     |          |  | 2,095  |         |  |  | 13      |   |  |  |      |   |  |  | 28,205  | 
|Other assets at fair value through P/ L*             |  |                 | 265     |              |            |  | 15         |           |  |          |           |   |  |            | 26      |     |          |  | 28     |         |  |  | 10,246  |   |  |  |      |   |  |  | 10,580  | 
|Other assets                                         |  |                 | 495     |              |            |  |           |           |  |          |           |   |  |            |        |     |          |  |       |         |  |  | 5,465   |   |  |  | 1,145 |   |  |  | 7,105   | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|Total assets                                         |  |                 | 95,581  |              |            |  | 7,583      |           |  |          | 8,000      |   |  |            | 25,122  |     |          |  | 5,089  |         |  |  | 17,651  |   |  |  | 3,298 |   |  |  | 162,324 | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|Liabilities                                          |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |   |  |  |       |   |  |  |         | 
|Deposits by banks                                    |  |                 | 27,352  |              |            |  | 2,576      |           |  |          | 1,763      |   |  |            | 79      |     |          |  | 20     |         |  |  | 12      |   |  |  | 510   |   |  |  | 32,312  | 
|Customer accounts                                    |  |                 | 44,334  |              |            |  | 1,728      |           |  |          | 1,501      |   |  |            | 3,055   |     |          |  | 1,214  |         |  |  | 9,878   |   |  |  |      |   |  |  | 61,710  | 
|Derivative financial instruments                     |  |                 |        |              |            |  |           |           |  |          |           |   |  |            |        |     |          |  |       |         |  |  | 456     |   |  |  | 1,191 |   |  |  | 1,647   | 
|Debt securities in issue                             |  |                 | 27,609  |              |            |  | 2,835      |           |  |          | 2,044      |   |  |            | 2,115   |     |          |  | 2,211  |         |  |  |        |   |  |  |      |   |  |  | 36,814  | 
|Subordinated liabilities                             |  |                 | 599     |              |            |  |           |           |  |          |           |   |  |            | 806     |     |          |  | 5,164  |         |  |  | (76     | ) |  |  |      |   |  |  | 6,493   | 
|Other liabilities*                                   |  |                 | 522     |              |            |  | 1          |           |  |          | 3          |   |  |            | 27      |     |          |  | 43     |         |  |  | 16,029  |   |  |  | 1,343 |   |  |  | 17,968  | 
|Total equity                                         |  |                 | 122     |              |            |  |           |           |  |          |           |   |  |            |        |     |          |  |       |         |  |  | 5,258   |   |  |  |      |   |  |  | 5,380   | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|Total liabilities                                    |  |                 | 100,538 |              |            |  | 7,140      |           |  |          | 5,311      |   |  |            | 6,082   |     |          |  | 8,652  |         |  |  | 31,557  |   |  |  | 3,044 |   |  |  | 162,324 | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|Net derivative financial instrument nominal values   |  |                 | 8,395   |              |            |  | 10,086     |           |  |          | (1,698     | ) |  |            | (16,401 | )   |          |  | (372   | )       |  |  |        |   |  |  | (10   | ) |  |  |        | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|Interest rate repricing gap                          |  |                 | 3,438   |              |            |  | 10,529     |           |  |          | 991        |   |  |            | 2,639   |     |          |  | (3,935 | )       |  |  | (13,906 | ) |  |  | 244   |   |  |  |        | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|Cumulative interest rate repricing gap               |  |                 | 3,438   |              |            |  | 13,967     |           |  |          | 14,958     |   |  |            | 17,597  |     |          |  | 13,662 |         |  |  | (244    | ) |  |  |      |   |  |  |        | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|EURO                                                 |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |   |  |  |       |   |  |  |         | 
|Cumulative interest rate repricing gap 31 March 2006 |  |                 | 382     |              |            |  | 5,032      |           |  |          | 6,230      |   |  |            | 7,057   |     |          |  | 4,684  |         |  |  | (365    | ) |  |  |       |   |  |  |         | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  
|Sterling                                             |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |   |  |  |       |   |  |  |         | 
|Cumulative interest rate repricing gap 31 March 2006 |  |                 | 10,783  |              |            |  | 17,834     |           |  |          | 17,629     |   |  |            | 18,518  |     |          |  | 18,968 |         |  |  | 4,490   |   |  |  |       |   |  |  |         | 
|                                                     |  |                 |         |              |            |  |            |           |  |          |            |   |  |            |         |     |          |  |        |         |  |  |         |  






|  |                                                                                                                                                                                                                                                                                                                                                                                                                                    
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | Long term assets and liabilities associated with the life
    business are measured on a different basis and the underlying
    cashflows are not directly subject to interest rate risk.
    Therefore these assets and liabilities have been included in
    non-interest bearing items in the Table above. Details of the
    sensitivity of the impact of these items on the Group income
    statement are set out in Note 46.

F-63



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                
|-- | -------------------------------
|32 | INTEREST RATE RISK  (continued)

As permitted by IFRS 1 the comparative interest rate
sensitivity table for 31 March 2005 is disclosed as previously
reported in the March 2005 Report and Accounts.


Non Trading Interest Rate Repricing  Total


|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       |  |  |         |   |  |  |         |  
|-------------------------------------------------------- |  | --------------- | ------ | ------------ | ---------- |  | ---------- | --------- |  | -------- | ---------- | - |  | ---------- | ------ | --- | -------- |  | ------ | ----- |  |  | ------- | - |  |  | ------- | -
|                                                         |  | 31 March 2005   |       
|                                                         |  |                 |       
|                                                         |  |                 |        | Over         |            |  | Over       |           |  | Over     |            |   | 
|                                                         |  |                 |        | three months |            |  | six months |           |  | one year |            |   | 
|                                                         |  | Not             |        |              | but not    |  |            | but not   |  |          | but not    |   |  |            |        | Non |          |  |       
|                                                         |  | more than       |        |              | more than  |  |            | more than |  |          | more than  |   |  | Over       |        |     | interest |  |        |      
|                                                         |  | three months    |        |              | six months |  |            | one year  |  |          | five years |   |  | five years |        |     | bearing  |  |        | Total | 
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|                                                         |  | (in  millions) |       
|Assets                                                   |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       |  |  |         |   |  |  |         |  
|Central Government bills and other eligible bills        |  |                 | 92     |              |            |  |           |           |  |          |           |   |  |            |       |     |          |  |       |       |  |  |        |   |  |  | 92      |  
|Loans and advances to banks                              |  |                 | 4,667  |              |            |  | 2,140      |           |  |          | 271        |   |  |            | 19     |     |          |  |       |       |  |  | 243     |   |  |  | 7,340   |  
|Loans and advances to customers                          |  |                 | 52,359 |              |            |  | 3,817      |           |  |          | 6,108      |   |  |            | 14,235 |     |          |  | 2,611  |       |  |  | 526     |   |  |  | 79,656  |  
|Investment securities  AFS                              |  |                 | 11,378 |              |            |  | 1,539      |           |  |          | 306        |   |  |            | 1,657  |     |          |  | 1,026  |       |  |  | 31      |   |  |  | 15,937  |  
|Other assets                                             |  |                 | 1,909  |              |            |  |           |           |  |          |           |   |  |            |       |     |          |  |       |       |  |  | 3,792   |   |  |  | 5,701   |  
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Total assets                                             |  |                 | 70,405 |              |            |  | 7,496      |           |  |          | 6,685      |   |  |            | 15,911 |     |          |  | 3,637  |       |  |  | 4,592   |   |  |  | 108,726 |  
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Liabilities                                              |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       |  |  |         |   |  |  |         |  
|Deposits by banks                                        |  |                 | 17,869 |              |            |  | 1,129      |           |  |          | 1,174      |   |  |            | 7      |     |          |  | 22     |       |  |  |        |   |  |  | 20,201  |  
|Customer accounts                                        |  |                 | 42,012 |              |            |  | 1,787      |           |  |          | 2,633      |   |  |            | 2,092  |     |          |  | 1,107  |       |  |  | 10,379  |   |  |  | 60,010  |  
|Debt securities in issue                                 |  |                 | 15,156 |              |            |  | 1,514      |           |  |          | 1,461      |   |  |            | 2,387  |     |          |  | 21     |       |  |  |        |   |  |  | 20,539  |  
|Other liabilities                                        |  |                 | 633    |              |            |  | 34         |           |  |          | 6          |   |  |            | 54     |     |          |  | 70     |       |  |  | 2,916   |   |  |  | 3,713   |  
|Subordinated liabilities                                 |  |                 | 714    |              |            |  |           |           |  |          |           |   |  |            | 1,397  |     |          |  | 1,975  |       |  |  |        |   |  |  | 4,086   |  
|Minority interests and shareholders funds               |  |                 |       |              |            |  |           |           |  |          |           |   |  |            |       |     |          |  |       |       |  |  | 4,924   |   |  |  | 4,924   |  
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Total liabilities                                        |  |                 | 76,384 |              |            |  | 4,464      |           |  |          | 5,274      |   |  |            | 5,937  |     |          |  | 3,195  |       |  |  | 18,219  |   |  |  | 113,473 |  
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Net amounts due from/to Group units                      |  |                 | 63     |              |            |  | (1,306     | )         |  |          | (225       | ) |  |            | 2,681  |     |          |  | 3,101  |       |  |  | 650     |   |  |  | 4,964   |  
|Off balance sheet items                                  |  |                 | 1,038  |              |            |  | 3,025      |           |  |          | 1,658      |   |  |            | (6,797 | )   |          |  | 791    |       |  |  |        |   |  |  | (285    | )
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Interest rate repricing gap                              |  |                 | (4,878 | )            |            |  | 4,751      |           |  |          | 2,844      |   |  |            | 5,858  |     |          |  | 4,334  |       |  |  | (12,977 | ) |  |  | (68     | )
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Cumulative interest rate repricing gap                   |  |                 | (4,878 | )            |            |  | (127       | )         |  |          | 2,717      |   |  |            | 8,575  |     |          |  | 12,909 |       |  |  | (68     | ) |  |  |         |  
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Euro                                                     |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       |  |  |         |   |  |  |         |  
|Cumulative interest rate repricing gap
    31 March 2005 |  |                 | 772    |              |            |  | 2,624      |           |  |          | 4,517      |   |  |            | 8,615  |     |          |  | 11,202 |       |  |  | 863     |   |  |  |         |  
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 
|Sterling                                                 |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       |  |  |         |   |  |  |         |  
|Cumulative interest rate repricing gap
    31 March 2005 |  |                 | (3,545 | )            |            |  | (2,783     | )         |  |          | (1,741     | ) |  |            | (30    | )   |          |  | 1,685  |       |  |  | (848    | ) |  |  |         |  
|                                                         |  |                 |        |              |            |  |            |           |  |          |            |   |  |            |        |     |          |  |        |       | 

F-64



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


33  LIQUIDITY RISK




Maturities of financial assets and liabilities


|                                           |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       |  |  |    |  |  |  |         | 
|------------------------------------------ |  | --------------- | ------ | ------- | ------ |  | ------ | ------ |  | --- | ----- |  | ------ | ----- | ------ | ------ | ------ |  | ------ | ----- |  |  | -- |  |  |  | ------- | 
|                                           |  |                 |        | Up to 3 |        |  | 3-12   |        |  | 1-5 |       |  | Over 5 |       |        | Equity |        |  |       
|As at 31 March 2006                        |  | Demand          |        |         | months |  |        | months |  |     | years |  |        | years |        |        | Shares |  |        | Total | 
|                                           |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       | 
|                                           |  | (in  millions) |       
|Assets                                     |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       |  |  |    |  |  |  |         | 
|Cash and balances at central banks         |  |                 | 287    |         |        |  | 1,612  |        |  |     |      |  |        |       |       |        |        |  |       |       |  |  |   |  |  |  | 1,899   | 
|Treasury and other eligible bills          |  |                 |       |         |        |  | 8      |        |  |     |      |  |        |       |       |        |        |  |       |       |  |  |   |  |  |  | 8       | 
|Loans and advances to banks                |  |                 | 2,937  |         |        |  | 5,321  |        |  |     | 2,225 |  |        |       | 54     |        |        |  | 39     |       |  |  |   |  |  |  | 10,576  | 
|Loans and advances to customers            |  |                 | 3,999  |         |        |  | 3,597  |        |  |     | 6,577 |  |        |       | 25,052 |        |        |  | 62,021 |       |  |  |   |  |  |  | 101,246 | 
|Trading securities                         |  |                 | 11     |         |        |  | 155    |        |  |     | 22    |  |        |       | 269    |        |        |  | 163    |       |  |  |   |  |  |  | 620     | 
|Derivative financial instruments           |  |                 | 13     |         |        |  | 185    |        |  |     | 175   |  |        |       | 301    |        |        |  | 1,411  |       |  |  |   |  |  |  | 2,085   | 
|Financial assets at fair value through P/L |  |                 | 2      |         |        |  | 314    |        |  |     | 49    |  |        |       | 472    |        |        |  | 9,743  |       |  |  |   |  |  |  | 10,580  | 
|Investment securities  available for sale |  |                 | 70     |         |        |  | 3,608  |        |  |     | 4,484 |  |        |       | 13,921 |        |        |  | 6,097  |       |  |  |   |  |  |  | 28,180  | 
|Equity shares  available for sale         |  |                 |       |         |        |  |       |        |  |     |      |  |        |       |       |        |        |  |       |       |  |  | 25 |  |  |  | 25      | 
|Liabilities                                |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       |  |  |    |  |  |  |         | 
|Deposits by banks                          |  |                 | 1,699  |         |        |  | 26,195 |        |  |     | 3,608 |  |        |       | 709    |        |        |  | 101    |       |  |  |   |  |  |  | 32,312  | 
|Customer accounts                          |  |                 | 34,389 |         |        |  | 18,381 |        |  |     | 5,112 |  |        |       | 2,380  |        |        |  | 1,448  |       |  |  |   |  |  |  | 61,710  | 
|Debt securities in issue                   |  |                 | 174    |         |        |  | 17,714 |        |  |     | 4,708 |  |        |       | 11,212 |        |        |  | 3,006  |       |  |  |   |  |  |  | 36,814  | 
|Derivative financial instruments           |  |                 | 23     |         |        |  | 136    |        |  |     | 159   |  |        |       | 195    |        |        |  | 1,134  |       |  |  |   |  |  |  | 1,647   | 
|Subordinated debt  dated                  |  |                 |       |         |        |  |       |        |  |     |      |  |        |       | 806    |        |        |  | 2,807  |       |  |  |   |  |  |  | 3,613   | 

Maturities of financial assets and liabilities


|                                   |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       |  |  |    |  |  |  |        | 
|---------------------------------- |  | --------------- | ------ | ------- | ------ |  | ------ | ------ |  | --- | ----- |  | ------ | ----- | ------ | ------ | ------ |  | ------ | ----- |  |  | -- |  |  |  | ------ | 
|                                   |  |                 |        | Up to 3 |        |  | 3-12   |        |  | 1-5 |       |  | Over 5 |       |        | Equity |        |  |       
|As at 31 March 2005                |  | Demand          |        |         | months |  |        | months |  |     | years |  |        | years |        |        | Shares |  |        | Total | 
|                                   |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       | 
|                                   |  | (in  millions) |       
|Assets                             |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       |  |  |    |  |  |  |        | 
|Cash and balances at central banks |  |                 | 451    |         |        |  | 1,149  |        |  |     |      |  |        |       |       |        |        |  |       |       |  |  |   |  |  |  | 1,600  | 
|Treasury and other eligible bills  |  |                 |       |         |        |  | 92     |        |  |     |      |  |        |       |       |        |        |  |       |       |  |  |   |  |  |  | 92     | 
|Loans and advances to banks        |  |                 | 1,382  |         |        |  | 3,662  |        |  |     | 2,682 |  |        |       | 23     |        |        |  | 34     |       |  |  |   |  |  |  | 7,783  | 
|Loans and advances to customers    |  |                 | 2,990  |         |        |  | 3,670  |        |  |     | 6,152 |  |        |       | 18,156 |        |        |  | 49,268 |       |  |  |   |  |  |  | 80,236 | 
|Debt securities                    |  |                 |       |         |        |  |       |        |  |     | 5,887 |  |        |       | 15,434 |        |        |  |       |       |  |  |   |  |  |  | 21,321 | 
|Equity shares                      |  |                 |       |         |        |  |       |        |  |     |      |  |        |       |       |        |        |  |       |       |  |  | 52 |  |  |  | 52     | 
|Liabilities                        |  |                 |        |         |        |  |        |        |  |     |       |  |        |       |        |        |        |  |        |       |  |  |    |  |  |  |        | 
|Deposits by banks                  |  |                 | 4,186  |         |        |  | 13,217 |        |  |     | 2,100 |  |        |       | 661    |        |        |  | 90     |       |  |  |   |  |  |  | 20,254 | 
|Customer accounts                  |  |                 | 32,847 |         |        |  | 16,724 |        |  |     | 4,643 |  |        |       | 4,776  |        |        |  | 1,275  |       |  |  |   |  |  |  | 60,265 | 
|Debt securities in issue           |  |                 |       |         |        |  | 11,445 |        |  |     | 4,529 |  |        |       | 2,546  |        |        |  | 2,019  |       |  |  |   |  |  |  | 20,539 | 
|Derivative financial instruments   |  |                 |       |         |        |  |       |        |  |     |      |  |        |       |       |        |        |  |       |       |  |  |   |  |  |  |       | 
|Subordinated debt  dated          |  |                 |       |         |        |  |       |        |  |     |      |  |        |       | 748    |        |        |  | 1,358  |       |  |  |   |  |  |  | 2,106  | 

F-65



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                
|-- | -----------------------------------------------
|34 | FAIR VALUES OF FINANCIAL ASSETS AND LIABILITIES







|                                                     |  |          |         |  |        |  |         |          |  |  |        |  |  |  |        | 
|---------------------------------------------------- |  | -------- | ------- |  | ------ |  | ------- | -------- |  |  | ------ |  |  |  | ------ | 
|                                                     |  | 2006     |         |  | 2005   | 
|                                                     |  |          |         |  |        | 
|                                                     |  | Carrying |         |  | Fair   |  |         | Carrying |  |  | Fair   | 
|                                                     |  | Amount   |         |  | Values |  |         | Amount   |  |  | Values | 
|                                                     |  |          |         |  |        |  |         |          |  |  |        | 
|                                                     |  | m       |         |  | m     |  |         | m       |  |  | m     | 
|Financial instruments held for trading               |  |          |         |  |        |  |         |          |  |  |        |  |  |  |        | 
|Debt securities(1)                                   |  |          | 596     |  |        |  | 596     |          |  |  | 6,264  |  |  |  | 6,264  | 
|Equity shares(1)                                     |  |          | 24      |  |        |  | 24      |          |  |  | 23     |  |  |  | 23     | 
|Trading derivative financial instruments            |  |          |         |  |        |  |         |          |  |  |        |  |  |  |        | 
|Interest rate contracts                              |  |          | 28      |  |        |  | 28      |          |  |  | 393    |  |  |  | 393    | 
|Foreign exchange contracts                           |  |          | 29      |  |        |  | 29      |          |  |  | 56     |  |  |  | 56     | 
|Equity and commodity contracts                       |  |          | 300     |  |        |  | 300     |          |  |  |       |  |  |  |       | 
|Non trading financial instruments                    |  |          |         |  |        |  |         |          |  |  |        |  |  |  |        | 
|Assets                                               |  |          |         |  |        |  |         |          |  |  |        |  |  |  |        | 
|Cash and balances at central banks(1)                |  |          | 1,899   |  |        |  | 1,899   |          |  |  | 1,600  |  |  |  | 1,600  | 
|Items in course of collection(1)                     |  |          | 930     |  |        |  | 930     |          |  |  | 560    |  |  |  | 560    | 
|Central government bills and other eligible bills(1) |  |          | 8       |  |        |  | 8       |          |  |  | 92     |  |  |  | 92     | 
|Loans and advances to banks                          |  |          | 10,576  |  |        |  | 10,576  |          |  |  | 7,783  |  |  |  | 8,013  | 
|Loans and advances to customers                      |  |          | 101,246 |  |        |  | 101,516 |          |  |  | 79,917 |  |  |  | 79,950 | 
|Securitisation and loan transfers(1)                 |  |          |        |  |        |  |        |          |  |  | 16     |  |  |  | 16     | 
|Debt securities                                      |  |          |        |  |        |  |        |          |  |  | 15,057 |  |  |  | 15,139 | 
|Financial assets available for sale                  |  |          | 28,205  |  |        |  | 28,205  |          |  |  |       |  |  |  |       | 
|Securitisation                                       |  |          |        |  |        |  |        |          |  |  | 19     |  |  |  | 19     | 
|Equity shares                                        |  |          |        |  |        |  |        |          |  |  | 29     |  |  |  | 29     | 
|Financial assets at fair value through P/ L          |  |          | 10,580  |  |        |  | 10,580  |          |  |  |       |  |  |  |       | 

F-66



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                 
|-- | ----------------------------------------------------------------
|34 | FAIR VALUES OF FINANCIAL ASSETS AND
    LIABILITIES  (continued)

|                                                    |  |          |        |  |        |  |        |          |  |  |        |  |  |  |        |  
|--------------------------------------------------- |  | -------- | ------ |  | ------ |  | ------ | -------- |  |  | ------ |  |  |  | ------ | -
|                                                    |  | 2006     |        |  | 2005   | 
|                                                    |  |          |        |  |        | 
|                                                    |  | Carrying |        |  | Fair   |  |        | Carrying |  |  | Fair   | 
|                                                    |  | Amount   |        |  | Values |  |        | Amount   |  |  | Values | 
|                                                    |  |          |        |  |        |  |        |          |  |  |        | 
|                                                    |  | m       |        |  | m     |  |        | m       |  |  | m     | 
|Liabilities                                         |  |          |        |  |        |  |        |          |  |  |        |  |  |  |        |  
|Deposits by banks                                   |  |          | 32,312 |  |        |  | 32,315 |          |  |  | 20,254 |  |  |  | 20,262 |  
|Customer accounts                                   |  |          | 61,710 |  |        |  | 61,751 |          |  |  | 60,265 |  |  |  | 60,259 |  
|Debt securities in issue                            |  |          | 36,814 |  |        |  | 36,879 |          |  |  | 20,539 |  |  |  | 20,577 |  
|Items in course of transmission(1)                  |  |          | 284    |  |        |  | 284    |          |  |  | 230    |  |  |  | 230    |  
|Subordinated liabilities                            |  |          | 6,493  |  |        |  | 6,654  |          |  |  | 4,086  |  |  |  | 4,434  |  
|Minority interests: non equity                      |  |          |       |  |        |  |       |          |  |  | 73     |  |  |  | 103    |  
|Liabilities to customers under investment contracts |  |          | 6,650  |  |        |  | 6,650  |          |  |  |       |  |  |  |       |  
|Insurance contract liabilities                      |  |          | 5,192  |  |        |  | 5,199  |          |  |  |       |  |  |  |       |  
|Derivative financial instruments  Hedging          |  |          |        |  |        |  |        |          |  |  |        |  |  |  |        |  
|Interest rate contracts                             |  |          | 81     |  |        |  | 81     |          |  |  |       |  |  |  | (148   | )
|Exchange rate contracts                             |  |          |       |  |        |  |       |          |  |  |       |  |  |  | (9     | )
|Equity and commodity contracts                      |  |          |       |  |        |  |       |          |  |  |       |  |  |  | 79     |  
|Credit contracts                                    |  |          |       |  |        |  |       |          |  |  |       |  |  |  | 1      |  






|    |                                                                                                                                                                                                                                          
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The fair value of these financial instruments is equal to the
    carrying value. These instruments are either carried at market
    value, or have minimal credit losses and are either short term
    in nature or repriced frequently.



Due from other banks


inter-bank




Loans and advances to customers




Investment securities


available-for


F-67



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                 
|-- | ----------------------------------------------------------------
|34 | FAIR VALUES OF FINANCIAL ASSETS AND
    LIABILITIES  (continued)

Deposits and borrowings


non-interest




Debt securities in issue






|   |                               
|-- | ------------------------------
|35 | RETIREMENT BENEFIT OBLIGATIONS







F-68



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                            
|-- | -------------------------------------------
|35 | RETIREMENT BENEFIT OBLIGATIONS  (continued)



Financial assumptions


|                                        |  |               |      |   |               |  |      | 
|--------------------------------------- |  | ------------- | ---- | - | ------------- |  | ---- | 
|                                        |  | 31 March 2006 |      |   | 31 March 2005 | 
|                                        |  |               |      |   |               | 
|                                        |  | % pa          |      |   | % pa          | 
|Irish Schemes                           |  |               |      |   |               |  |      | 
|Inflation rate                          |  |               | 2.10 |   |               |  | 2.25 | 
|Discount rate                           |  |               | 4.60 |   |               |  | 4.85 | 
|Rate of general increase in salaries    |  |               | 3.26 | * |               |  | 2.99 | 
|Rate of increase in pensions in payment |  |               | 2.93 | * |               |  | 2.66 | 
|Rate of increase to deferred pensions   |  |               | 2.10 |   |               |  | 2.25 | 
|                                        |  |               |      |   |               | 
|UK Schemes                              |  |               |      |   |               |  |      | 
|Inflation rate                          |  |               | 2.75 |   |               |  | 2.75 | 
|Discount rate                           |  |               | 4.95 |   |               |  | 5.40 | 
|Rate of general increase in salaries    |  |               | 3.97 | * |               |  | 3.50 | 
|Rate of increase in pensions in payment |  |               | 3.33 | * |               |  | 2.74 | 
|Rate of increase to deferred pensions   |  |               | 2.75 |   |               |  | 2.75 | 






|  |                                                                                          
|- | -----------------------------------------------------------------------------------------
|* | Allows for additional 0.5% for 5 years beginning
    April 1, 2005 for Staff Pension Fund

Mortality assumptions






|                                                 |  |                    |     |          |               |  |           |                |  |  |              |  |  |  |        |  
|------------------------------------------------ |  | ------------------ | --- | -------- | ------------- |  | --------- | -------------- |  |  | ------------ |  |  |  | ------ | -
|                                                 |  | 31 March 2006      |     |          | 31 March 2005 | 
|                                                 |  |                    |     |          |               | 
|                                                 |  |                    |     | Expected |               |  |          
|                                                 |  | Expected long term |     |          |               |  | long term |                |  | 
|                                                 |  | rate of return     |     |          | Market Value  |  |           | rate of return |  |  | Market Value | 
|                                                 |  |                    |     |          |               |  |           |                |  |  |              | 
|                                                 |  | %                  |     |          | m            |  |           | %              |  |  | m           | 
|Equities                                         |  |                    | 7.5 |          |               |  | 2,687     |                |  |  | 7.8          |  |  |  | 2,177  |  
|Bonds                                            |  |                    | 4.2 |          |               |  | 860       |                |  |  | 4.1          |  |  |  | 752    |  
|Property                                         |  |                    | 6.5 |          |               |  | 487       |                |  |  | 6.8          |  |  |  | 400    |  
|Cash                                             |  |                    | 3.3 |          |               |  | 36        |                |  |  | 3.5          |  |  |  | 88     |  
|                                                 |  |                    |     |          |               |  |           |                |  |  |              | 
|Total market value of schemes assets             |  |                    | 6.6 |          |               |  | 4,070     |                |  |  | 6.8          |  |  |  | 3,417  |  
|Actuarial value of liabilities of funded schemes |  |                    |     |          |               |  | (4,866    | )              |  |  |              |  |  |  | (4,341 | )
|                                                 |  |                    |     |          |               |  |           |                |  |  |              | 
|Aggregate deficit in schemes                     |  |                    |     |          |               |  | (796      | )              |  |  |              |  |  |  | (924   | )
|Unfunded schemes                                 |  |                    |     |          |               |  | (12       | )              |  |  |              |  |  |  |       |  
|                                                 |  |                    |     |          |               |  |           |                |  |  |              | 
|Net pension deficit                              |  |                    |     |          |               |  | (808      | )              |  |  |              |  |  |  | (924   | )
|                                                 |  |                    |     |          |               |  |           |                |  |  |              | 

F-69



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                            
|-- | -------------------------------------------
|35 | RETIREMENT BENEFIT OBLIGATIONS  (continued)

   




Components of pension expenses


|                                              |  |      |      |   |      |  |      |  
|--------------------------------------------- |  | ---- | ---- | - | ---- |  | ---- | -
|                                              |  | 2006 |      |   | 2005 | 
|                                              |  |      |      |   |      | 
|                                              |  | m   |      |   | m   | 
|Current service cost                          |  |      | 158  |   |      |  | 119  |  
|Past service cost                             |  |      | 14   |   |      |  | 1    |  
|Curtailments                                  |  |      | (11  | ) |      |  | (7   | )
|Expected return on pension scheme assets      |  |      | (232 | ) |      |  | (209 | )
|Interest on pension scheme liabilities        |  |      | 210  |   |      |  | 193  |  
|                                              |  |      |      |   |      | 
|Cost of providing defined retirement benefits |  |      | 139  |   |      |  | 97   |  
|                                              |  |      |      |   |      | 

Actual return on scheme assets


|                                   |  |      |     |  |      |  |     | 
|---------------------------------- |  | ---- | --- |  | ---- |  | --- | 
|                                   |  | 2006 |     |  | 2005 | 
|                                   |  |      |     |  |      | 
|                                   |  | m   |     |  | m   | 
|Expected return on scheme assets   |  |      | 232 |  |      |  | 209 | 
|Asset gain (loss) on scheme assets |  |      | 401 |  |      |  | 114 | 
|                                   |  |      |     |  |      | 
|Actual return on scheme assets     |  |      | 633 |  |      |  | 323 | 
|                                   |  |      |     |  |      | 

Reconciliation of defined benefit obligations during the
year


|                                                |  |      |       |   |      |  |       |  
|----------------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | -
|                                                |  | 2006 |       |   | 2005 | 
|                                                |  |      |       |   |      | 
|                                                |  | m   |       |   | m   | 
|Defined benefit obligation at beginning of year |  |      | 4,341 |   |      |  | 3,554 |  
|Current service cost                            |  |      | 158   |   |      |  | 119   |  
|Actual member contributions                     |  |      | 13    |   |      |  | 12    |  
|Past service cost                               |  |      | 14    |   |      |  | 1     |  
|Interest cost                                   |  |      | 210   |   |      |  | 193   |  
|Actuarial gains and losses                      |  |      | 270   |   |      |  | 579   |  
|Benefits paid                                   |  |      | (120  | ) |      |  | (99   | )
|Curtailments                                    |  |      | (11   | ) |      |  | (7    | )
|Settlements                                     |  |      | 6     |   |      |  |      |  
|Currency gain/loss                              |  |      | (3    | ) |      |  | (11   | )
|                                                |  |      |       |   |      | 
|Defined benefit obligation at end of year       |  |      | 4,878 |   |      |  | 4,341 |  
|                                                |  |      |       |   |      | 

F-70



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                            
|-- | -------------------------------------------
|35 | RETIREMENT BENEFIT OBLIGATIONS  (continued)

Reconciliation of the fair value of scheme assets during the
year


|                                                 |  |      |       |   |      |  |       |  
|------------------------------------------------ |  | ---- | ----- | - | ---- |  | ----- | -
|                                                 |  | 2006 |       |   | 2005 | 
|                                                 |  |      |       |   |      | 
|                                                 |  | m   |       |   | m   | 
|Fair value of scheme assets at beginning of year |  |      | 3,417 |   |      |  | 3,102 |  
|Expected return                                  |  |      | 232   |   |      |  | 209   |  
|Actual member contributions                      |  |      | 13    |   |      |  | 12    |  
|Actuarial gains and losses                       |  |      | 401   |   |      |  | 114   |  
|Contributions by employer                        |  |      | 124   |   |      |  | 87    |  
|Benefits paid                                    |  |      | (120  | ) |      |  | (99   | )
|Settlements                                      |  |      | 6     |   |      |  |      |  
|Currency gain/loss                               |  |      | (3    | ) |      |  | (8    | )
|                                                 |  |      |       |   |      | 
|Fair value of scheme assets at end of year       |  |      | 4,070 |   |      |  | 3,417 |  
|                                                 |  |      |       |   |      | 

Analysis of the amount recognised in Statement of Recognised
Income and Expense (SORIE)


|                                                                                          |  |      |      |   |      |  |      |  
|----------------------------------------------------------------------------------------- |  | ---- | ---- | - | ---- |  | ---- | -
|                                                                                          |  | 2006 |      |   | 2005 | 
|                                                                                          |  |      |      |   |      | 
|                                                                                          |  | m   |      |   | m   | 
|Actuarial gain/(loss) on scheme assets                                                    |  |      | 401  |   |      |  | 114  |  
|Experience gain/(loss) on liabilities                                                     |  |      | (46  | ) |      |  | 43   |  
|(Loss)/gain on change of assumptions (financial and demographic)                          |  |      | (224 | ) |      |  | (622 | )
|Currency gain/(loss)                                                                      |  |      |     |   |      |  | 3    |  
|                                                                                          |  |      |      |   |      | 
|Total gains/(losses) recognised in the SORIE during the year
    before adjustment of tax |  |      | 131  |   |      |  | (462 | )
|                                                                                          |  |      |      |   |      | 
|Cumulative amount of gains/(losses) recognised in SORIE to end
    of year                |  |      | (331 | ) |      |  | (462 | )
|                                                                                          |  |      |      |   |      | 

History of experience gains and losses


|                                                 |  |      |      |   |      |  |       |  
|------------------------------------------------ |  | ---- | ---- | - | ---- |  | ----- | -
|                                                 |  | 2006 |      |   | 2005 | 
|                                                 |  |      |      |   |      | 
|                                                 |  | m   |      |   | m   | 
|Actuarial gain/(loss) on scheme assets:          |  |      |      |   |      |  |       |  
|Amount                                           |  |      | 401  |   |      |  | 114   |  
|Percentage of scheme assets                      |  |      | 9.9  | % |      |  | 3.3   | %
|Experience gains/(losses) on scheme liabilities: |  |      |      |   |      |  |       |  
|Amount                                           |  |      | (46) |   |      |  | 43    |  
|Percentage of scheme liabilities                 |  |      | 0.9  | % |      |  | 1.0   | %
|Total actuarial gain/(loss) recognised in SORIE: |  |      |      |   |      |  |       |  
|Amount                                           |  |      | 131  |   |      |  | (462) |  
|Percentage of scheme liabilities                 |  |      | 2.7  | % |      |  | 10.6  | %

Defined benefit pension plans


|                                    |  |      |       |  |      |  |       | 
|----------------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                                    |  | 2006 |       |  | 2005 | 
|                                    |  |      |       |  |      | 
|                                    |  | m   |       |  | m   | 
|Present value of funded obligations |  |      | 4,866 |  |      |  | 4,341 | 
|Scheme assets                       |  |      | 4,070 |  |      |  | 3,417 | 
|                                    |  |      |       |  |      | 
|Deficit/(Surplus) within schemes    |  |      | 796   |  |      |  | 924   | 
|                                    |  |      |       |  |      | 

F-71



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                            
|-- | -------------------------------------------
|35 | RETIREMENT BENEFIT OBLIGATIONS  (continued)

Additional information


|                                |  |               |     | 
|------------------------------- |  | ------------- | --- | 
|For year ending:                |  | 31 March 2007 |    
|                                |  |               |    
|                                |  | m            |    
|Expected employer contributions |  |               | 106 | 
|Expected employee contributions |  |               | 13  | 



|   |                                       
|-- | --------------------------------------
|36 | CONTINGENT LIABILITIES AND COMMITMENTS

non-performance


|                                                     |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |       |        |  |       |       |       | 
|---------------------------------------------------- | ------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------- | ------ | ----- | -------- |  | ----- | -------- | ----- |  | -------- | ----- | ------ |  | ----- | ----- | ----- | 
|                                                     |                                                                                                   | 2006                                                                         |        |       | 2005     | 
|                                                     |                                                                                                   |                                                                              |        |       |          | 
|                                                     |                                                                                                   |                                                                              |        | Risk  |          |  | Risk  |          |       | 
|                                                     |                                                                                                   | Contract                                                                     |        |       | Weighted |  |       | Contract |       |  | Weighted |      
|Contingent Liabilities                               |                                                                                                   | Amount                                                                       |        |       | Amount   |  |       | Amount   |       |  | Amount   |      
|                                                     |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |      
|                                                     |                                                                                                   | m                                                                           |        |       | m       |  |       | m       |       |  | m       |      
|Acceptances and endorsements                         |                                                                                                   |                                                                              | 37     |       |          |  | 21    |          |       |  | 34       |       |        |  | 17    |      
|Guarantees and assets pledged as collateral security |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |       |        |  |       |      
|                                                     |  Assets pledged                                                                                  |                                                                              |        |      |          |  |       |         |       |  |          |      |        |  |       |      |      
|                                                     |  Guarantees and irrevocable letters of credit                                                    |                                                                              |        | 1,354 |          |  |       | 1,321    |       |  |          | 1,268 |        |  |       | 1,222 |      
|Other contingent liabilities                         |                                                                                                   |                                                                              | 675    |       |          |  | 327   |          |       |  | 643      |       |        |  | 302   |      
|                                                     |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |      
|                                                     |                                                                                                   |                                                                              | 2,066  |       |          |  | 1,669 |          |       |  | 1,945    |       |        |  | 1,541 |      
|                                                     |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |      
|Commitments                                          |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |       |        |  |       |      
|Sale and option to resell transactions               |                                                                                                   |                                                                              |       |       |          |  |      |          |       |  |         |       |        |  |      |      
|Other commitments                                    |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |       |        |  |       |      
|                                                     |  Documentary credits and short-term trade-related
    transactions                               |                                                                              |        | 160   |          |  |       | 36       |       |  |          | 62    |        |  |       | 18    |      
|                                                     |  Forward asset purchases, forward deposits placed and
    forward sale and repurchase agreements |                                                                              |        |      |          |  |       |         |       |  |          |      |        |  |       |      |      
|                                                     |  Undrawn note issuance and revolving underwriting
    facilities                                 |                                                                              |        | 409   |          |  |       |         |       |  |          | 498   |        |  |       |      |      
|                                                     |  Undrawn formal standby facilities, credit lines and
    other commitments to lend               |                                                                              |        |       |          |  |       |          |       |  |          |       |        |  |       |       |      
|                                                     |                                                                                                   |  irrevocable with original maturity of over
    1 year                      |        |       | 8,006    |  |       |          | 3,790 |  |          |       | 7,367  |  |       |       | 3,425 | 
|                                                     |                                                                                                   |  revocable or irrevocable with original maturity of
    1 year or less (ii) |        |       | 22,362   |  |       |          |      |  |          |       | 21,369 |  |       |       |      | 
|                                                     |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |      
|                                                     |                                                                                                   |                                                                              | 30,937 |       |          |  | 3,826 |          |       |  | 29,296   |       |        |  | 3,443 |      
|                                                     |                                                                                                   |                                                                              |        |       |          |  |       |          |       |  |          |      






|     |                                                                                                                                                                                               
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(i)  | Under the Basel agreement, a credit conversion factor is applied
    to the contract amount to obtain the credit equivalent amount,
    which is then risk weighted according to counterparty.
|    
|(ii) | Undrawn loan commitments which are unconditionally cancellable
    at any time or which have a maturity of less than one year have
    a risk weighting of zero.                              

F-72



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                  
|-- | -----------------
|37 | MINORITY INTEREST

|                                    |  |      |     |   |      |  |     |  
|----------------------------------- |  | ---- | --- | - | ---- |  | --- | -
|                                    |  | 2006 |     |   | 2005 | 
|                                    |  |      |     |   |      | 
|                                    |  | m   |     |   | m   | 
|At April 1,                         |  |      | 135 |   |      |  | 130 |  
|Implementation of IAS 32/39/IFRS 4  |  |      | (76 | ) |      |  |    |  
|                                    |  |      |     |   |      | 
|                                    |  |      | 59  |   |      |  | 130 |  
|Exchange adjustments                |  |      | (1  | ) |      |  | (5  | )
|Share of net profit/(losses)        |  |      | (9  | ) |      |  | (1  | )
|Dividends paid to minority interest |  |      | (6  | ) |      |  | (14 | )
|Acquisition of minority interest    |  |      | 2   |   |      |  | 67  |  
|Disposal of minority interest       |  |      |    |   |      |  | (42 | )
|                                    |  |      |     |   |      | 
|                                    |  |      | 45  |   |      |  | 135 |  
|                                    |  |      |     |   |      | 



|   |                                                
|-- | -----------------------------------------------
|38 | SHARE CAPITAL, SHARE PREMIUM AND TREASURY STOCK

Capital Stock


|                                                                  |  |      |       |  |      |  |       | 
|----------------------------------------------------------------- |  | ---- | ----- |  | ---- |  | ----- | 
|                                                                  |  | 2006 |       |  | 2005 | 
|                                                                  |  |      |       |  |      | 
|                                                                  |  | m   |       |  | m   | 
|Authorised                                                        |  |      |       |  |      |  |       | 
|1,500m units of
    0.64 of Ordinary
    Stock                   |  |      | 960   |  |      |  | 960   | 
|8m units of Non-Cumulative Preference Stock of U.S.$25 each       |  |      | 165   |  |      |  | 154   | 
|100m units of Non-Cumulative Preference Stock of
    Stg£1 each   |  |      | 144   |  |      |  | 145   | 
|100m units of Non-Cumulative Preference Stock of
    1.27 each   |  |      | 127   |  |      |  | 127   | 
|100m units of Undesignated Preference Stock of
    U.S.$0.25 each |  |      | 21    |  |      |  |      | 
|100m units of Undesignated Preference Stock of
    Stg£0.25 each  |  |      | 36    |  |      |  |      | 
|100m units of Undesignated Preference Stock of
    0.25 each     |  |      | 25    |  |      |  |      | 
|                                                                  |  |      |       |  |      | 
|                                                                  |  |      | 1,478 |  |      |  | 1,386 | 
|                                                                  |  |      |       |  |      | 

Allotted and fully paid


|                                                                |  |      |     |  |      |  |     | 
|--------------------------------------------------------------- |  | ---- | --- |  | ---- |  | --- | 
|                                                                |  | 2006 |     |  | 2005 | 
|                                                                |  |      |     |  |      | 
|947.9m units of
    0.64 of Ordinary
    Stock                 |  |      | 607 |  |      |  | 604 | 
|77.2m units of
    0.64 of Treasury
    Stock                  |  |      | 49  |  |      |  | 52  | 
|1.9m units of Non-Cumulative Preference Stock of
    Stg£1 each |  |      | 3   |  |      |  | 3   | 
|3.0m units of Non-Cumulative Preference Stock of
    1.27 each |  |      | 4   |  |      |  | 4   | 
|                                                                |  |      |     |  |      | 
|                                                                |  |      | 663 |  |      |  | 663 | 
|                                                                |  |      |     |  |      | 



F-73



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                 
|-- | ----------------------------------------------------------------
|38 | SHARE CAPITAL, SHARE PREMIUM AND TREASURY
    STOCK  (continued)

Movements in issued Ordinary Stock


|                                                                             |  |          |             |   |          |  |            |  
|---------------------------------------------------------------------------- |  | -------- | ----------- | - | -------- |  | ---------- | -
|                                                                             |  | Ordinary |             |   | Treasury | 
|                                                                             |  |          |             |   |          | 
|At April 1, 2005                                                             |  |          | 943,038,140 |   |          |  | 82,077,349 |  
|Stock Option Schemes                                                         |  |          | 1,014,111   |   |          |  | (1,014,111 | )
|Sharesave Scheme                                                             |  |          | 4,885,238   |   |          |  | (4,885,238 | )
|Long Term Performance Stock Plan                                             |  |          | 124,385     |   |          |  | (124,385   | )
|Stock purchased and held for the benefit of life assurance
    policyholders |  |          | (1,158,704  | ) |          |  | 1,158,704  |  
|                                                                             |  |          |             |   |          | 
|At 31 March 2006                                                             |  |          | 947,903,170 |   |          |  | 77,212,319 |  
|                                                                             |  |          |             |   |          | 




 


  re-issue


  


  re-issue






Preference Stock


non-redeemable. non-cumulative  semi-annual






F-74



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                 
|-- | ----------------------------------------------------------------
|38 | SHARE CAPITAL, SHARE PREMIUM AND TREASURY
    STOCK  (continued)





Use of Ordinary Stock in employee stock schemes




|    |                            
|--- | ---------------------------
|(a) | Employee Stock Issue Scheme







To-date,




|    |                                 
|--- | --------------------------------
|(b) | Sharesave Scheme (SAYE Scheme)

  


F-75



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                 
|-- | ----------------------------------------------------------------
|38 | SHARE CAPITAL, SHARE PREMIUM AND TREASURY
    STOCK  (continued)

|                             |  |      |           |  |          |  |           |          |  |  |           |  |  |          |           |  |          |  |           |       |  |  |         |  |  |  |            | 
|---------------------------- |  | ---- | --------- |  | -------- |  | --------- | -------- |  |  | --------- |  |  | -------- | --------- |  | -------- |  | --------- | ----- |  |  | ------- |  |  |  | ---------- | 
|                             |  | ROI  |           |  | UK       |  |           |         
|                             |  |      |           |  |          |  |           |         
|March 2006                   |  | 2000 |           |  | 2003 3yr |  |           | 2003 5yr |  |  | 2000      |  |  | 2003 3yr |           |  | 2003 5yr |  |           | Total | 
|                             |  |      |           |  |          |  |           |          |  |  |           |  |  |          |           |  |          |  |           |       | 
|Opening balance              |  |      | 6,234,943 |  |          |  | 3,690,316 |          |  |  | 2,317,593 |  |  |          | 1,885,811 |  |          |  | 1,021,436 |       |  |  | 569,328 |  |  |  | 15,719,427 | 
|Exercised                    |  |      | 3,606,565 |  |          |  | 3,452     |          |  |  | 750       |  |  |          | 1,116,473 |  |          |  | 58,325    |       |  |  | 22,361  |  |  |  | 4,807,926  | 
|Lapsed                       |  |      | 99,442    |  |          |  | 256,029   |          |  |  | 107,586   |  |  |          | 173,758   |  |          |  | 136,260   |       |  |  | 96,036  |  |  |  | 869,111    | 
|Close                        |  |      | 2,528,936 |  |          |  | 3,430,835 |          |  |  | 2,209,257 |  |  |          | 595,580   |  |          |  | 826,851   |       |  |  | 450,931 |  |  |  | 10,042,390 | 
|                             |  |      |           |  |          |  |           |          |  |  |           |  |  |          |           |  |          |  |           |       | 
|Weighted average share price |  |      | 5.40     |  |          |  | 7.84     |          |  |  | 7.84     |  |  |          | 5.40     |  |          |  | 8.37     |       |  |  | 8.37   |  |  |  | 7.15      | 

(c)  Stock Option Scheme




|                                   |  |                   |           |                  |                |  |          |                   |                  |  |                |  |  |  |          | 
|---------------------------------- |  | ----------------- | --------- | ---------------- | -------------- |  | -------- | ----------------- | ---------------- |  | -------------- |  |  |  | -------- | 
|                                   |  | March 2006        |           |                  | March 2005     | 
|                                   |  |                   |           |                  |                | 
|                                   |  |                   |           | Weighted average |                |  |          |                   | Weighted average | 
|                                   |  | Number of options |           |                  | exercise price |  |          | Number of options |                  |  | exercise price | 
|                                   |  |                   |           |                  |                |  |          |                   |                  |  |                | 
|Outstanding at beginning of period |  |                   | 6,611,900 |                  |                |  | 9.6809  |                   |                  |  | 6,585,000      |  |  |  | 8.9894  | 
|Granted during the period          |  |                   | 1,267,514 |                  |                |  | 12.8811 |                   |                  |  | 1,661,500      |  |  |  | 10.76   | 
|Exercised during period            |  |                   | 1,014,111 |                  |                |  | 7.1695  |                   |                  |  | 853,500        |  |  |  | 5.5684  | 
|Expired during period              |  |                   | 132,500   |                  |                |  | 9.8688  |                   |                  |  | 781,100        |  |  |  | 10.6398 | 
|Outstanding at end of period       |  |                   | 6,732,803 |                  |                |  | 10.658  |                   |                  |  | 6,611,900      |  |  |  | 9.6809  | 
|Exercisable at end of period       |  |                   | 2,407,289 |                  |                |  | 9.3693  |                   |                  |  | 2,643,400      |  |  |  | 7.5393  | 
|                                   |  |                   |           |                  |                |  |          |                   |                  |  |                | 

|                     |  |                   |           | 
|-------------------- |  | ----------------- | --------- | 
|Exercise Price Range |  | Number of options |          
|                     |  |                   |          
|2.819-6.99          |  |                   | 686,934   | 
|8.264-10.77         |  |                   | 3,702,900 | 
|11.05-13.68         |  |                   | 2,342,969 | 
|                     |  |                   |          
|Total                |  |                   | 6,732,803 | 
|                     |  |                   |          




F-76



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                 
|-- | ----------------------------------------------------------------
|38 | SHARE CAPITAL, SHARE PREMIUM AND TREASURY
    STOCK  (continued)



|    |                                 
|--- | --------------------------------
|(d) | Long Term Performance Stock Plan





three-year


|                                           |  |                                            
|------------------------------------------ |  | -------------------------------------------
|                                          
|TSR ranking relative to a Peer Group of 17 |  |                                            
|Financial Services Companies               |  | Level of Vesting                           
|                                          
|1st or 2nd                                 |  | 100%                                       
|                                          
|3rd to 8th                                 |  | Scaled level of vesting between 91% and 44%
|                                          
|9th (Median)                               |  | 35%                                        
|                                          
|Below Median                               |  | Nil                                        
|                                          

three-year


|                                   |  |                   |           |                  |                |  |        |                   |                  |  |                |  |  |  |        | 
|---------------------------------- |  | ----------------- | --------- | ---------------- | -------------- |  | ------ | ----------------- | ---------------- |  | -------------- |  |  |  | ------ | 
|                                   |  | March 2006        |           |                  | March 2005     | 
|                                   |  |                   |           |                  |                | 
|                                   |  |                   |           | Weighted average |                |  |        |                   | Weighted average | 
|                                   |  | Number of options |           |                  | exercise price |  |        | Number of options |                  |  | exercise price | 
|                                   |  |                   |           |                  |                |  |        |                   |                  |  |                | 
|Outstanding at beginning of period |  |                   | 1,229,805 |                  |                |  | 11.06 |                   |                  |  | 808,895        |  |  |  | 9.35  | 
|Granted during the period          |  |                   | 698,682   |                  |                |  | 12.92 |                   |                  |  | 694,500        |  |  |  | 10.76 | 
|Exercised during period            |  |                   | 98,101    |                  |                |  | 12.73 |                   |                  |  |               |  |  |  |       | 
|Expired during period              |  |                   | 168,953   |                  |                |  | 12.05 |                   |                  |  | 273,590        |  |  |  | 10.58 | 
|Outstanding at end of period       |  |                   | 1,661,432 |                  |                |  | 11.64 |                   |                  |  | 1,229,805      |  |  |  | 11.06 | 

10.61-12.85.


F-77



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                 
|-- | ----------------------------------------------------------------
|38 | SHARE CAPITAL, SHARE PREMIUM AND TREASURY
    STOCK  (continued)

(e)  Options Pricing Model




|               |  |                     |         |  |            |  |         |            |  |  |            |  |  |  |        | 
|-------------- |  | ------------------- | ------- |  | ---------- |  | ------- | ---------- |  |  | ---------- |  |  |  | ------ | 
|               |  | Stock Option Scheme |         |  | LTPSP      | 
|               |  |                     |         |  |            | 
|               |  | March 2006          |         |  | March 2005 |  |         | March 2006 |  |  | March 2005 | 
|               |  |                     |         |  |            |  |         |            |  |  |            | 
|Volatility     |  |                     | 30%     |  |            |  | 30%     |            |  |  | 30%        |  |  |  | 30%    | 
|Dividend Yield |  |                     | 3.60%   |  |            |  | 3.50%   |            |  |  | 3.60%      |  |  |  | 3.50%  | 
|Risk free rate |  |                     | 3.1%    |  |            |  | 4%      |            |  |  | N/A        |  |  |  | N/A    | 
|Implied term   |  |                     | 8yrs    |  |            |  | 8yrs    |            |  |  | 3yrs       |  |  |  | 3yrs   | 
|Fair value     |  |                     | 2.65   |  |            |  | 2.81   |            |  |  | 5.2       |  |  |  | 4.56  | 
|Exercise price |  |                     | 12.85  |  |            |  | 10.76  |            |  |  | 12.85     |  |  |  | 10.76 | 
|No of options  |  |                     | 1,259.5 |  |            |  | 1,639.5 |            |  |  | 689.2      |  |  |  | 694.5  | 
|Vesting period |  |                     | 3yrs    |  |            |  | 3yrs    |            |  |  | 3yrs       |  |  |  | 3yrs   | 

|               |  |            |         |  |           |  |         |       |  |  |       |  |  |  |       | 
|-------------- |  | ---------- | ------- |  | --------- |  | ------- | ----- |  |  | ----- |  |  |  | ----- | 
|               |  | SAYE (ROI) |         |  | SAYE (UK) | 
|               |  |            |         |  |           | 
|               |  | 3Year      |         |  | 5Year     |  |         | 3Year |  |  | 5Year | 
|               |  |            |         |  |           |  |         |       |  |  |       | 
|Volatility     |  |            | 30%     |  |           |  | 30%     |       |  |  | 30%   |  |  |  | 30%   | 
|Dividend Yield |  |            | 3.3%    |  |           |  | 3.3%    |       |  |  | 3.3%  |  |  |  | 3.3%  | 
|Risk free rate |  |            | 3.0%    |  |           |  | 3.6%    |       |  |  | 3.0%  |  |  |  | 3.6%  | 
|Implied term   |  |            | 3yrs    |  |           |  | 5yrs    |       |  |  | 3yrs  |  |  |  | 5yrs  | 
|Fair value     |  |            | 3.28   |  |           |  | 3.54   |       |  |  | 3.00 |  |  |  | 3.31 | 
|Exercise price |  |            | 7.84   |  |           |  | 7.84   |       |  |  | 8.37 |  |  |  | 8.37 | 
|No of options  |  |            | 3,430.8 |  |           |  | 2,209.2 |       |  |  | 826.8 |  |  |  | 450.9 | 
|Vesting period |  |            | 3yrs    |  |           |  | 5yrs    |       |  |  | 3yrs  |  |  |  | 5yrs  | 

(f)  Limitations on Employee Stock Issue and Stock
Option Schemes




F-78



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                               
|-- | ------------------------------
|39 | RESERVES AND RETAINED EARNINGS

|                                                            |  |      |       |   |      |  |       |  
|----------------------------------------------------------- |  | ---- | ----- | - | ---- |  | ----- | -
|                                                            |  | 2006 |       |   | 2005 | 
|                                                            |  |      |       |   |      | 
|                                                            |  | m   |       |   | m   | 
|Stock premium account                                       |  |      |       |   |      |  |       |  
|Opening balance                                             |  |      | 767   |   |      |  | 767   |  
|                                                            |  |      |       |   |      | 
|Closing balance                                             |  |      | 767   |   |      |  | 767   |  
|                                                            |  |      |       |   |      | 
|Capital reserve                                             |  |      |       |   |      |  |       |  
|Opening balance                                             |  |      | 562   |   |      |  | 503   |  
|Implementation of IAS32/ IAS39 & IFRS4 on April 1,
    2005 |  |      | (251  | ) |      |  |      |  
|                                                            |  |      |       |   |      | 
|                                                            |  |      | 311   |   |      |  | 503   |  
|Transfer from retained profit                               |  |      | 48    |   |      |  | 43    |  
|Reserve on cancellation of stock                            |  |      |      |   |      |  | 16    |  
|                                                            |  |      |       |   |      | 
|Closing balance                                             |  |      | 359   |   |      |  | 562   |  
|                                                            |  |      |       |   |      | 
|Retained profit                                             |  |      |       |   |      |  |       |  
|Opening balance                                             |  |      | 2,424 |   |      |  | 2,215 |  
|Implementation of IAS32/ IAS39 on April 1, 2005             |  |      | (32   | ) |      |  |      |  
|                                                            |  |      |       |   |      | 
|                                                            |  |      | 2,392 |   |      |  | 2,215 |  
|Profit for period                                           |  |      | 1,296 |   |      |  | 1,054 |  
|Equity dividends                                            |  |      | (459  | ) |      |  | (417  | )
|Dividends on other equity interests                         |  |      | (13   | ) |      |  | (8    | )
|Transfer to capital reserves                                |  |      | (48   | ) |      |  | (43   | )
|Minority interest                                           |  |      | 9     |   |      |  | 1     |  
|                                                            |  |      |       |   |      | 
|Profit retained                                             |  |      | 785   |   |      |  | 587   |  
|Reissue of treasury stock under employee stock schemes      |  |      | 36    |   |      |  | 7     |  
|Reissue of treasury stock previously held by subsidiary     |  |      |      |   |      |  | 1     |  
|Transfer from revaluation reserve                           |  |      | 4     |   |      |  | 6     |  
|Actuarial gains/(losses) on pension funds                   |  |      | 113   |   |      |  | (386  | )
|Reserves transferred to/from other units                    |  |      |      |   |      |  |      |  
|Other                                                       |  |      |      |   |      |  | (6    | )
|                                                            |  |      |       |   |      | 
|Closing balance                                             |  |      | 3,330 |   |      |  | 2,424 |  
|                                                            |  |      |       |   |      | 
|Share based payments reserve                                |  |      |       |   |      |  |       |  
|Opening balance                                             |  |      | 16    |   |      |  | 5     |  
|Charge to the income statement                              |  |      | 11    |   |      |  | 11    |  
|                                                            |  |      |       |   |      | 
|Closing balance                                             |  |      | 27    |   |      |  | 16    |  
|                                                            |  |      |       |   |      | 
|Foreign exchange reserve                                    |  |      |       |   |      |  |       |  
|Opening balance                                             |  |      | (108  | ) |      |  |      |  
|Exchange adjustments during year                            |  |      | (17   | ) |      |  | (108  | )
|                                                            |  |      |       |   |      | 
|Closing balance                                             |  |      | (125  | ) |      |  | (108  | )
|                                                            |  |      |       |   |      | 

F-79



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                            
|-- | -------------------------------------------
|39 | RESERVES AND RETAINED EARNINGS  (continued)

|                                                |  |      |      |   |      |  |     |  
|----------------------------------------------- |  | ---- | ---- | - | ---- |  | --- | -
|                                                |  | 2006 |      |   | 2005 | 
|                                                |  |      |      |   |      | 
|                                                |  | m   |      |   | m   | 
|Revaluation reserve                             |  |      |      |   |      |  |     |  
|Opening balance                                 |  |      | 159  |   |      |  | 122 |  
|Transfer to revenue reserve on sale of property |  |      | (4   | ) |      |  | (6  | )
|Revaluation of property                         |  |      | 212  |   |      |  | 48  |  
|Deferred tax on revaluation of property         |  |      | (25  | ) |      |  | (5  | )
|                                                |  |      |      |   |      | 
|Closing balance                                 |  |      | 342  |   |      |  | 159 |  
|                                                |  |      |      |   |      | 
|Available for sale reserve                      |  |      |      |   |      |  |     |  
|Implementation of IAS32/ IAS39 on April 1, 2005 |  |      | 130  |   |      |  |    |  
|Net changes in fair value                       |  |      | (115 | ) |      |  |    |  
|Deferred tax on fair value changes              |  |      | 15   |   |      |  |    |  
|Profit/loss on disposal                         |  |      | (4   | ) |      |  |    |  
|                                                |  |      |      |   |      | 
|Closing balance                                 |  |      | 26   |   |      |  |    |  
|                                                |  |      |      |   |      | 
|Cash flow hedge reserve                         |  |      |      |   |      |  |     |  
|Implementation of IAS32/ IAS39 on April 1, 2005 |  |      | 67   |   |      |  |    |  
|Net changes in fair value                       |  |      | (8   | ) |      |  |    |  
|Deferred tax of fair value changes              |  |      | 1    |   |      |  |    |  
|                                                |  |      |      |   |      | 
|Closing balance                                 |  |      | 60   |   |      |  |    |  
|                                                |  |      |      |   |      | 
|Other equity reserve                            |  |      |      |   |      |  |     |  
|Implementation of IAS32/ IAS39 on April 1, 2005 |  |      | 114  |   |      |  |    |  
|Movement during period                          |  |      |     |   |      |  |    |  
|                                                |  |      |      |   |      | 
|Closing balance                                 |  |      | 114  |   |      |  |    |  
|                                                |  |      |      |   |      | 



|   |                    
|-- | -------------------
|40 | DIVIDENDS PER SHARE

  




|   |                          
|-- | -------------------------
|41 | CASH AND CASH EQUIVALENTS



|                                                                                  |  |       |    |    |      |  |       |      |  |  |       | 
|--------------------------------------------------------------------------------- |  | ----- | -- | -- | ---- |  | ----- | ---- |  |  | ----- | 
|                                                                                  |  | Notes |    |    | 2006 |  |       | 2005 | 
|                                                                                  |  |       |    |    |      |  |       |      | 
|                                                                                  |  |       |    | m |      |  | m    |     
|Cash and balances with central banks                                              |  |       |    |    |      |  | 1,899 |      |  |  | 1,613 | 
|Loans and advances to banks (with an original maturity of less
    than 3 months) |  |       | 16 |    |      |  | 4,255 |      |  |  | 3,597 | 
|Central government and other eligible bills                                       |  |       | 13 |    |      |  | 8     |      |  |  | 7     | 
|                                                                                  |  |       |    |    |      |  |       |      | 
|                                                                                  |  |       |    |    |      |  | 6,162 |      |  |  | 5,217 | 
|                                                                                  |  |       |    |    |      |  |       |      | 

F-80



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


42  GENERAL




| |     |                                                                                                                                                                                                                                                                                   
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) | The Bank has given letters of credit in respect of certain of
    its subsidiaries to the relevant regulatory authorities for the
    protection of the depositors of certain of its banking
    subsidiaries in the various jurisdictions in which such
    subsidiaries operate.



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (b) | The Bank has provided a guarantee under Section 17 of the
    Companies (Amendment) Act, 1986 for the following companies:
    Addano Limited, Bank of Ireland Asset Management (U.S.) Limited,
    Bank of Ireland Asset Management Limited, Bank of Ireland Car
    Loans Limited, Bank of Ireland Commercial Finance Limited, Bank
    of Ireland Insurance Services Limited, Bank of Ireland
    International Finance Limited, Bank of Ireland Outsourcing
    Services Limited, Bank of Ireland Unit Trust Managers
    Limited, Bushfield Leasing Limited, Clonvern Limited, Davy
    Corporate Finance Limited, Davy Holdings (International)
    Limited, Davy International, Davy International Financial
    Services Limited, Davy Nominees Limited, Davy Pensioneer
    Trustees Limited, Davycrest Nominees Limited, Davy Property
    Holdings Limited, Davy Property Investments Limited, Davy
    Research Limited, Davy Securities Limited, Edendork Leasing
    Limited, First Rate Enterprises Limited, Florenville Limited,
    Focus Investments Limited, Glenswilly Leasing Limited, IBI
    Corporate Finance Limited, J & E Davy,
    J & E Davy Holdings Limited, Nerling Limited,
    Nestland Limited, Premier  Direct Management Limited,
    Premier  Direct Insurance Services Limited and Tustin
    Limited.



| |     |                                                                                                                                                                       
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (c) | There exists a contingent liability to repay in whole or in part
    grants received on finance leases if certain events set out in
    the relevant agreements occur.



| |     |                      
| | --- | ---------------------
| | (d) | Bank Income Statement



| |                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | In accordance with section 148(8) of the Companies Act,
    1963 and section 7(1A) of the Companies (Amendment) Act,
    1986, the company is availing of the exemption from presenting
    its individual profit and loss account to the annual general
    meeting and from filing it with the Registrar of Companies. The
    companys profit for the financial year determined in
    accordance with IFRS
    is 670m.

43  RELATED PARTY TRANSACTIONS


year-end


(a)  Associated Undertakings and Joint Ventures




| |                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------
| | The Group provides and receives from its associated undertakings
    and joint ventures certain banking and financial services.

(b)  Pension Funds




| |                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Group provides a number of normal banking and financial
    services for various pension funds operated by the Group for the
    benefit of its employees (principally for the Bank Staff Pension
    Fund), which are conducted on similar terms to third party
    transactions and are not material to the Group. Further details
    on pensions are set out in Note 35.

F-81



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




43  RELATED PARTY
TRANSACTIONS  (continued)


(c)  Transactions with key management personnel




| |                                                                                                                                                                                                                                                                                                                                                                                                         
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | For the purposes of IAS 24, key management
    personnel comprises the Directors of the Court, the Group
    Secretary and the members of the Group Executive Committee,
    (collectively Directors and Executive Officers).                                                                                                                                                                         
|
| | Directors emoluments are set out in the Remuneration
    Report on
    pages  l to  l and
    details of compensation paid to key management personnel are
    provided below.                                                                                                                                                                                                                         
|
| | In the year to 31 March 2006, the late Mr Donal
    Geaney, former Director, was a partner in The Common Street
    Partnership, the owner of New Century House, Mayor Street, IFSC,
    Dublin 1, which is leased ultimately to Bank of Ireland,
    for 9 years, 11 months at an annual rent of
    1.97m. The lease
    was entered into prior to the late Mr Geaneys appointment
    to the Court.






 






|                                    |  |                  |        |  |           |  |        |      |  |  |      |  |  |  |      | 
|----------------------------------- |  | ---------------- | ------ |  | --------- |  | ------ | ---- |  |  | ---- |  |  |  | ---- | 
|                                    |  | Aggregate Amount |        |  | Number of | 
|                                    |  | Outstanding      |        |  | Persons   | 
|                                    |  |                  |        |  |           | 
|                                    |  | 2006             |        |  | 2005      |  |        | 2006 |  |  | 2005 | 
|                                    |  |                  |        |  |           |  |        |      |  |  |      | 
|                                    |  | 000            |        |  | 000     |  |        |      |  | 
|Directors                           |  |                  |        |  |           |  |        |      |  |  |      |  |  |  |      | 
|Loans                               |  |                  | 28,519 |  |           |  | 28,376 |      |  |  | 12   |  |  |  | 15   | 
|Quasi-loans and credit transactions |  |                  |       |  |           |  |       |      |  |  | None |  |  |  | None | 
|Executive Officers                  |  |                  |        |  |           |  |        |      |  |  |      |  |  |  |      | 
|Loans                               |  |                  | 6,968  |  |           |  | 2,887  |      |  |  | 7    |  |  |  | 6    | 
|Quasi-loans and credit transactions |  |                  |       |  |           |  |       |      |  |  | None |  |  |  | None | 
|                                    |  |                  |        |  |           |  |        |      |  |  |      | 
|Total                               |  |                  | 35,487 |  |           |  | 31,263 |      |  |  | 19   |  |  |  | 21   | 
|                                    |  |                  |        |  |           |  |        |      |  |  |      | 

 


F-82



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




43  RELATED PARTY
TRANSACTIONS  (continued)


(d) Compensation of key management




|                                                   |  |       |        |  |       |  |        | 
|-------------------------------------------------- |  | ----- | ------ |  | ----- |  | ------ | 
|                                                   |  | 2006  |        |  | 2005  | 
|                                                   |  |       |        |  |       | 
|                                                   |  | 000 |        |  | 000 | 
|Remuneration                                       |  |       |        |  |       |  |        | 
|Salaries and other short term employee benefits(1) |  |       | 12,551 |  |       |  | 8,508  | 
|Post employment benefits(2)                        |  |       | 2,433  |  |       |  | 1,060  | 
|Termination benefits                               |  |       | 1,465  |  |       |  | 2,700  | 
|Equity compensation benefits(3)                    |  |       | 2,370  |  |       |  | 1,410  | 
|                                                   |  |       |        |  |       | 
|Total remuneration                                 |  |       | 18,819 |  |       |  | 13,678 | 
|                                                   |  |       |        |  |       | 






|    |                                                                                                                                     
|--- | ------------------------------------------------------------------------------------------------------------------------------------
|(1) | Comprises salary, bonus, car allowance, club membership fees,
    profit share schemes and other short term benefits.               
|   
|(2) | Employer contributions to pension funds.                                                                                            
|   
|(3) | Value of awards made under the Groups executive share
    option scheme, SAYE schemes and LTPSP which are described in
    Note 38.

44  ACQUISITIONS


Guggenheim Advisors






|                   |  |        |      |   |    |  |      |  
|------------------ |  | ------ | ---- | - | -- |  | ---- | -
|                   |  | U.S.$m |      |   | m | 
|                   |  |        |      |   |    | 
|Operating income   |  |        | 5.8  |   |    |  | 4.8  |  
|Operating expenses |  |        | (3.2 | ) |    |  | (2.7 | )
|                   |  |        |      |   |    | 
|Operating profit   |  |        | 2.6  |   |    |  | 2.1  |  
|                   |  |        |      |   |    | 



|                  |  |             |      |  |             |  |      | 
|----------------- |  | ----------- | ---- |  | ----------- |  | ---- | 
|                  |  | U.S.$m      |      |  | m          | 
|                  |  |             |      |  |             | 
|                  |  | (unaudited) |      |  | (unaudited) | 
|Revenue           |  |             | 33.1 |  |             |  | 27.3 | 
|Profit before tax |  |             | 10.7 |  |             |  | 8.9  | 

F-83



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




44  ACQUISITIONS     (continued)




|                              |  |        |      |             |        |  |       |    |  |  |       |  
|----------------------------- |  | ------ | ---- | ----------- | ------ |  | ----- | -- |  |  | ----- | -
|                              |  |        |      | Group Share |        |  |      
|                              |  | U.S.$m |      |             | U.S.$m |  |       | m | 
|                              |  |        |      |             |        |  |       |    | 
|Debtors                       |  |        | 6.0  |             |        |  | 4.3   |    |  |  | 3.6   |  
|Cash and cash equivalents     |  |        | 1.1  |             |        |  | 0.8   |    |  |  | 0.7   |  
|Other Assets                  |  |        | 2.2  |             |        |  | 1.6   |    |  |  | 1.3   |  
|Creditors Due Within One Year |  |        | (1.5 | )           |        |  | (1.1  | )  |  |  | (0.9  | )
|                              |  |        |      |             |        |  |       |    | 
|Net Assets                    |  |        | 7.8  |             |        |  | 5.6   |    |  |  | 4.7   |  
|                              |  |        |      |             |        |  |       |    | 
|Intangible assets*            |  |        |      |             |        |  | 27.9  |    |  |  | 23.0  |  
|Goodwill                      |  |        |      |             |        |  | 111.8 |    |  |  | 92.4  |  
|                              |  |        |      |             |        |  |       |    | 
|Total acquisition cost        |  |        |      |             |        |  | 145.3 |    |  |  | 120.1 |  
|                              |  |        |      |             |        |  |       |    | 
|Acquisition expenses          |  |        |      |             |        |  | 7.0   |    |  |  | 5.8   |  
|Consideration                 |  |        |      |             |        |  | 138.3 |    |  |  | 114.3 |  
|                              |  |        |      |             |        |  |       |    | 
|                              |  |        |      |             |        |  | 145.3 |    |  |  | 120.1 |  
|                              |  |        |      |             |        |  |       |    | 






|  |                                                                                                                                                                                                                                                   
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | The intangible represents an estimate of the value of the
    business model and risk management systems acquired. It is
    calculated with reference to similar transactions in the market
    and external advice received from market experts.

Iridian










F-84



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                        
|-- | -----------------------
|45 | LIFE ASSURANCE BUSINESS

Value of In-force Life Assurance Business


|                                                             |  |    |      |  
|------------------------------------------------------------ |  | -- | ---- | -
|                                                             |  | m |     
|                                                             |  |    |     
|At 31 March 2005                                             |  |    | 751  |  
|Change in accounting policy on adoption of IFRS 4 and IAS 39 |  |    | (323 | )
|                                                             |  |    |     
|At April 1, 2005                                             |  |    | 428  |  
|Profit and Loss movement in value of in-force                |  |    | 73   |  
|Asset Reallocation                                           |  |    | 12   |  
|                                                             |  |    |     
|At 31 March 2006                                             |  |    | 513  |  
|                                                             |  |    |     





|                     |  |            |       |  |            |  |       | 
|-------------------- |  | ---------- | ----- |  | ---------- |  | ----- | 
|                     |  | March 2006 |       |  | March 2005 | 
|                     |  |            |       |  |            | 
|Risk Discount Rate   |  |            | 7.5%  |  |            |  | 8.0%  | 
|Unit Growth Rate     |  |            | 5.5%  |  |            |  | 6.0%  | 
|Shareholder Tax Rate |  |            | 12.5% |  |            |  | 12.5% | 





|                         |  |                                                                                                                                                                                                                                                 
|------------------------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Risk Discount Rate:      |  | The risk discount rate is the rate used to discount the
    surpluses that will arise on insurance business in the long-term
    fund. The rate reflects the yield available on government bonds
    of appropriate duration plus a risk margin.
|                        
|Unit Growth Rate:        |  | The unit growth rate is the assumed rate of return on the
    Companys unit-linked assets before taxation and management
    fees in future years. The growth rate reflects the mix of assets
    held.                                        
|                        
|Shareholder Tax Rate:    |  | The current rate of corporation tax is assumed to be maintained
    over the term of the business. Deferred tax is allowed for on
    the release of retained surplus in the life business.                                                     
|                        
|Mortality and Morbidity: |  | Mortality and morbidity assumptions, which include allowances
    for improvements in longevity for annuitants, are set by
    reference to the Groups actual experience and/or relevant
    industry data.                                    
|                        
|Persistency:             |  | Persistency rates refer to the rate of policy termination for
    insurance policies. These rates are based on historical
    experience and managements views on future experience.                                                           
|                        
|Maintenance expenses:    |  | Allowance is made for future policy costs by reference to
    current and expected future costs. Explicit allowance is made
    for future expense inflation.                                                                                   

F-85



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                     
|-- | ------------------------------------
|45 | LIFE ASSURANCE BUSINESS  (continued)

Sensitivities




|                                        |  |                             |     |  
|--------------------------------------- |  | --------------------------- | --- | -
|                                        |  | Impact on Profit After Tax/ |    
|Change in Risk Discount Rate Assumption |  | Shareholders Equity m     |    
|                                        |  |                             |    
|+100bps                                 |  |                             | (24 | )
|-100 bps                                |  |                             | 27  |  



Insurance Contract Liabilities




|                                                             |  |    |        |  
|------------------------------------------------------------ |  | -- | ------ | -
|                                                             |  | m |       
|                                                             |  |    |       
|At 31 March 2005                                             |  |    | 8,713  |  
|Change in accounting policy on adoption of IFRS 4 and IAS 39 |  |    | (4,928 | )
|                                                             |  |    |       
|At April 1, 2005                                             |  |    | 3,785  |  
|Movement during the period                                   |  |    | 1,407  |  
|                                                             |  |    |       
|At 31 March 2006                                             |  |    | 5,192  |  
|                                                             |  |    |       



Non-Linked Life Assurance Contracts




Non-Linked Annuity Contracts




Linked Insurance Contracts








|               |  |                                                                                                                                                                       
|-------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Interest Rate: |  | The interest rates are derived in accordance with the guidelines
    in the Insurance Regulations. Margins for risk are allowed for
    in the derived interest rates.

F-86



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                     
|-- | ------------------------------------
|45 | LIFE ASSURANCE BUSINESS  (continued)



|                         |  |                                                                                                                                                                                                                  
|------------------------ |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Mortality and morbidity: |  | The mortality and morbidity assumptions, which include an
    allowance for improvements in longevity for annuitants, are set
    with regard to the Groups actual experience and/or
    relevant industry data.
|                        
|Maintenance expenses:    |  | Allowance is made for future policy costs and expense inflation
    explicitly.                                                                                                                                  



Options & Guarantees




Uncertainties associated with insurance contract cash flows
and risk management activities




Credit risk




Capital Management & Available Resources




|                                          |  |                   |       |  |                   |  |       | 
|----------------------------------------- |  | ----------------- | ----- |  | ----------------- |  | ----- | 
|                                          |  | December 31, 2005 |       |  | December 31, 2004 | 
|                                          |  |                   |       |  |                   | 
|                                          |  |  million         |       |  |  million         | 
|Minimum regulatory solvency margin        |  |                   | 144.8 |  |                   |  | 107.7 | 
|Shareholder equity held for life business |  |                   | 317.9 |  |                   |  | 294.2 | 





|   |                                  
|-- | ---------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS





F-87



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)















Reconciliation of Movements in Stockholders Funds


|                                                               |  |    |      |   |    |  |       |  
|-------------------------------------------------------------- |  | -- | ---- | - | -- |  | ----- | -
|                                                               |  | m |      |   | m | 
|                                                               |  |    |      |   |    | 
|Opening Irish GAAP Stockholders funds as at 31 March
    2004 |  |    |      |   |    |  | 4,281 |  
|IFRS Impact April 1, 2004                                      |  |    |      |   |    |  |       |  
|Ordinary Dividends                                             |  |    | 257  |   |    |  |       |  
|Pensions                                                       |  |    | (286 | ) |    |  |       |  
|SPEs                                                          |  |    | (63  | ) |    |  |       |  
|Leasing                                                        |  |    | 52   |   |    |  |       |  
|Consolidation                                                  |  |    | 12   |   |    |  |       |  
|Property                                                       |  |    | (145 | ) |    |  |       |  
|                                                               |  |    |      |   |    | 
|Total IFRS adjustments April 1, 2004                           |  |    |      |   |    |  | (173  | )
|                                                               |  |    |      |   |    | 
|Opening IFRS Stockholders funds as at April 1,
    2004       |  |    |      |   |    |  | 4,108 |  
|IFRS Retained Profit for the year to 31 March 2005             |  |    |      |   |    |  | 1,054 |  
|Dividends (IFRS)                                               |  |    |      |   |    |  | (417  | )
|                                                               |  |    |      |   |    | 
|                                                               |  |    |      |   |    |  | 637   |  
|Minority interests/preference dividends                        |  |    |      |   |    |  | (7    | )
|Exchange adjustments as per IR GAAP                            |  |    |      |   |    |  | (108  | )
|Movements in own shares                                        |  |    |      |   |    |  | (15   | )
|                                                               |  |    |      |   |    | 
|                                                               |  |    |      |   |    |  | 507   |  

F-88



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                               |  |    |      |   |  |  |       |  
|---------------------------------------------- |  | -- | ---- | - |  |  | ----- | -
|Reserve Movements (IFRS)                       |  | m |      |   | 
|                                               |  |    |      |   | 
|Pensions                                       |  |    | (386 | ) |  |  |       |  
|Consolidation                                  |  |    | (5   | ) |  |  |       |  
|Employee benefits                              |  |    | 11   |   |  |  |       |  
|Goodwill                                       |  |    | (1   | ) |  |  |       |  
|Property                                       |  |    | 43   |   |  |  |       |  
|                                               |  |    |      |   |  | 
|                                               |  |    |      |   |  |  | (338  | )
|                                               |  |    |      |   |  | 
|Net movements in reserves 31 March 2005        |  |    |      |   |  |  | 169   |  
|                                               |  |    |      |   |  | 
|Closing IFRS Stockholders funds 31 March 2005 |  |    |      |   |  |  | 4,277 |  

|                                                         |  |    |      |   |  |  |       | 
|-------------------------------------------------------- |  | -- | ---- | - |  |  | ----- | 
|IFRS Impact April 1, 2005                                |  | m |      |   | 
|                                                         |  |    |      |   | 
|Reclassification                                         |  |    | 127  |   |  |  |       | 
|Hedging                                                  |  |    | 15   |   |  |  |       | 
|VIF in life business                                     |  |    | (251 | ) |  |  |       | 
|Debt/equity reclassification                             |  |    | 114  |   |  |  |       | 
|Effective interest rate                                  |  |    | 20   |   |  |  |       | 
|Other                                                    |  |    | 3    |   |  |  |       | 
|                                                         |  |    |      |   |  | 
|                                                         |  |    |      |   |  |  | 28    | 
|                                                         |  |    |      |   |  | 
|Opening IFRS Stockholders funds as at April 1,
    2005 |  |    |      |   |  |  | 4,305 | 
|                                                         |  |    |      |   |  | 

F-89



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

Summary Consolidated IFRS Income Statement for the year ended
31 March 2005


|                                                       |  |                  |        |   |             |  |        |      |  |  |        |  
|------------------------------------------------------ |  | ---------------- | ------ | - | ----------- |  | ------ | ---- |  |  | ------ | -
|                                                       |  | Total Irish GAAP |        |   | IFRS Impact |  |        | IFRS | 
|                                                       |  |                  |        |   |             |  |        |      | 
|                                                       |  | m               |        |   | m          |  |        | m   | 
|Net interest income                                    |  |                  | 1,898  |   |             |  | 33     |      |  |  | 1,931  |  
|Insurance net premium income                           |  |                  |       |   |             |  | 1,791  |      |  |  | 1,791  |  
|Fees and commissions income                            |  |                  | 1,200  |   |             |  | (37    | )    |  |  | 1,163  |  
|Fees and commissions expense                           |  |                  | (199   | ) |             |  | (64    | )    |  |  | (263   | )
|Net trading income                                     |  |                  | 66     |   |             |  |       |      |  |  | 66     |  
|Contribution from the life assurance business          |  |                  | 161    |   |             |  | (161   | )    |  |  |       |  
|Other operating income                                 |  |                  | 47     |   |             |  | 786    |      |  |  | 833    |  
|                                                       |  |                  |        |   |             |  |        |      | 
|Total operating income                                 |  |                  | 3,173  |   |             |  | 2,348  |      |  |  | 5,521  |  
|Insurance net claims                                   |  |                  |       |   |             |  | (2,222 | )    |  |  | (2,222 | )
|                                                       |  |                  |        |   |             |  |        |      | 
|Total operating income net of insurance claims         |  |                  | 3,173  |   |             |  | 126    |      |  |  | 3,299  |  
|Operating expenses                                     |  |                  | (1,924 | ) |             |  | (127   | )    |  |  | (2,051 | )
|                                                       |  |                  |        |   |             |  |        |      | 
|Operating profit before impairment losses              |  |                  | 1,249  |   |             |  | (1     | )    |  |  | 1,248  |  
|Impairment losses on loans and advances                |  |                  | 21     |   |             |  |       |      |  |  | 21     |  
|                                                       |  |                  |        |   |             |  |        |      | 
|Operating profit                                       |  |                  | 1,270  |   |             |  | (1     | )    |  |  | 1,269  |  
|Profit/loss on disposal of business                    |  |                  |       |   |             |  | 11     |      |  |  | 11     |  
|Other exceptional items                                |  |                  | 5      |   |             |  | (5     | )    |  |  |       |  
|Income from associated undertakings and joint ventures |  |                  | 46     |   |             |  | (16    | )    |  |  | 30     |  
|                                                       |  |                  |        |   |             |  |        |      | 
|Profit before taxation                                 |  |                  | 1,321  |   |             |  | (11    | )    |  |  | 1,310  |  
|Taxation                                               |  |                  | (241   | ) |             |  | (15    | )    |  |  | (256   | )
|                                                       |  |                  |        |   |             |  |        |      | 
|Profit for the period                                  |  |                  | 1,080  |   |             |  | (26    | )    |  |  | 1,054  |  
|                                                       |  |                  |        |   |             |  |        |      | 
|Attributable to minority interests                     |  |                  | (1     | ) |             |  |       |      |  |  | (1     | )
|Attributable to stockholders                           |  |                  | 1,081  |   |             |  | (26    | )    |  |  | 1,055  |  
|                                                       |  |                  |        |   |             |  |        |      | 
|                                                       |  |                  | 1,080  |   |             |  | (26    | )    |  |  | 1,054  |  
|                                                       |  |                  |        |   |             |  |        |      | 
|Basic earnings per ordinary share                      |  |                  | 113.9  |   |             |  | (2.8   | )    |  |  | 111.1  |  
|                                                       |  |                  |        |   |             |  |        |      | 

F-90



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

Consolidated Summary of IFRS Income Adjustments for Year
Ended 31 March 2005


|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      |  |  |     |   |  |  |        |   |  |  |        |  
|------------------------------------------------------ |  | ------------- | ------ | -------- | --- |  | ---------- | --- |  | ------- | ------ | -------- | -------- | --- | ---------- | ----------- | --- |  | -------- | --- | -- | ------- | --- | -- | ----- | --------- | -- | ---------- | ----------- |  | --- | ---- |  |  | --- | - |  |  | ------ | - |  |  | ------ | -
|                                                       |  | Consolidation |       
|                                                       |  |               |       
|                                                       |  |               |        | New      |     |  | Insurance  |     |  |         |        | Employee |          |     | Software & |             |     | 
|                                                       |  |               |        | Entities |     |  | Businesses |     |  | Leasing |        |          | benefits |     |            | Intangibles |     |  | Goodwill |     |    | Pension |     |    | Other |           |    | Total IFRS |             |  |    
|                                                       |  | Irish GAAP    |        |          | (a) |  |            | (b) |  |         | (h)    |          |          | (e) |            |             | (g) |  |          | (d) |    |         | (f) |    |       | (j) & (k) |    |            | adjustments |  |     | IFRS | 
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|                                                       |  | m            |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     | m |         |     | m |      
|Net interest income                                    |  |               | 1,898  |          |     |  | 20         |     |  |         | 12     |          |          |     | 1          |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  | 33     |   |  |  | 1,931  |  
|Insurance premium income net                           |  |               |       |          |     |  |           |     |  |         | 1,791  |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  | 1,791  |   |  |  | 1,791  |  
|Fees and commissions income                            |  |               | 1,200  |          |     |  | (4         | )   |  |         | (29    | )        |          |     | (4         | )           |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  | (37    | ) |  |  | 1,163  |  
|Fees and commissions expense                           |  |               | (199   | )        |     |  | (5         | )   |  |         | (59    | )        |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  | (64    | ) |  |  | (263   | )
|Net trading income                                     |  |               | 66     |          |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  |       |   |  |  | 66     |  
|Contribution from the life assurance business          |  |               | 161    |          |     |  |           |     |  |         | (161   | )        |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  | (161   | ) |  |  |       |  
|Other operating income                                 |  |               | 47     |          |     |  | (2         | )   |  |         | 779    |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  | 9   |   |  |  | 786    |   |  |  | 833    |  
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|Total operating income                                 |  |               | 3,173  |          |     |  | 9          |     |  |         | 2,333  |          |          |     | (3         | )           |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  | 9   |   |  |  | 2,348  |   |  |  | 5,521  |  
|Insurance claims, net                                  |  |               |       |          |     |  |           |     |  |         | (2,222 | )        |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  | (2,222 | ) |  |  | (2,222 | )
|Administrative expenses                                |  |               | (1,738 | )        |     |  | (1         | )   |  |         | (84    | )        |          |     |           |             |     |  | (8       | )   |    |         |    |    |       |           |   |            |             |  | (28 | )    |  |  | (15 | ) |  |  | (136   | ) |  |  | (1,874 | )
|Depreciation of property, plant and equipment          |  |               | (161   | )        |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         | 85  |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  | 85     |   |  |  | (76    | )
|Amortisation/impairment of goodwill and intangibles    |  |               | (25    | )        |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         | (85 | )  |       |           | 13 |            |             |  |    |      |  |  | (4  | ) |  |  | (76    | ) |  |  | (101   | )
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|Total operating expenses                               |  |               | (1,924 | )        |     |  | (1         | )   |  |         | (84    | )        |          |     |           |             |     |  | (8       | )   |    |         |    |    |       |           | 13 |            |             |  | (28 | )    |  |  | (19 | ) |  |  | (127   | ) |  |  | (2,051 | )
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|Operating profit before impairment losses              |  |               | 1,249  |          |     |  | 8          |     |  |         | 27     |          |          |     | (3         | )           |     |  | (8       | )   |    |         |    |    |       |           | 13 |            |             |  | (28 | )    |  |  | (10 | ) |  |  | (1     | ) |  |  | 1,248  |  
|Impairment losses on loans and advances                |  |               | 21     |          |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  |       |   |  |  | 21     |  
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|Operating profit                                       |  |               | 1,270  |          |     |  | 8          |     |  |         | 27     |          |          |     | (3         | )           |     |  | (8       | )   |    |         |    |    |       |           | 13 |            |             |  | (28 | )    |  |  | (10 | ) |  |  | (1     | ) |  |  | 1,269  |  
|Income from associated undertakings and joint ventures |  |               | 46     |          |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  | (16 | ) |  |  | (16    | ) |  |  | 30     |  
|Exceptional items                                      |  |               | 5      |          |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  | (5  | ) |  |  | (5     | ) |  |  |       |  
|Profit/loss on disposal of businesses                  |  |               |       |          |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  | 11  |   |  |  | 11     |   |  |  | 11     |  
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|Profit before taxation                                 |  |               | 1,321  |          |     |  | 8          |     |  |         | 27     |          |          |     | (3         | )           |     |  | (8       | )   |    |         |    |    |       |           | 13 |            |             |  | (28 | )    |  |  | (20 | ) |  |  | (11    | ) |  |  | 1,310  |  
|Taxation                                               |  |               | (241   | )        |     |  |           |     |  |         | (27    | )        |          |     | (5         | )           |     |  |         |     |    |         |    |    |       |           |   |            |             |  | 5   |      |  |  | 12  |   |  |  | (15    | ) |  |  | (256   | )
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|Profit for the period                                  |  |               | 1,080  |          |     |  | 8          |     |  |         |       |          |          |     | (8         | )           |     |  | (8       | )   |    |         |    |    |       |           | 13 |            |             |  | (23 | )    |  |  | (8  | ) |  |  | (26    | ) |  |  | 1,054  |  
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|Profit attributable to minority interests              |  |               | (1     | )        |     |  |           |     |  |         |       |          |          |     |           |             |     |  |         |     |    |         |    |    |       |           |   |            |             |  |    |      |  |  |    |   |  |  |       |   |  |  | (1     | )
|Profit attributable to stockholders                    |  |               | 1,081  |          |     |  | 8          |     |  |         |       |          |          |     | (8         | )           |     |  | (8       | )   |    |         |    |    |       |           | 13 |            |             |  | (23 | )    |  |  | (8  | ) |  |  | (26    | ) |  |  | 1,055  |  
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 
|                                                       |  |               | 1,080  |          |     |  | 8          |     |  |         |       |          |          |     | (8         | )           |     |  | (8       | )   |    |         |    |    |       |           | 13 |            |             |  | (23 | )    |  |  | (8  | ) |  |  | (26    | ) |  |  | 1,054  |  
|                                                       |  |               |        |          |     |  |            |     |  |         |        |          |          |     |            |             |     |  |          |     |    |         |     |    |       |           |    |            |             |  |     |      | 

F-91



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

Consolidated Balance Sheet at 31 March 2005


|                                                          |  |       |         |  |        |  |        |      |  |  |         | 
|--------------------------------------------------------- |  | ----- | ------- |  | ------ |  | ------ | ---- |  |  | ------- | 
|                                                          |  | Irish |         |  | IFRS   |  |        |     
|                                                          |  | GAAP  |         |  | Impact |  |        | IFRS | 
|                                                          |  |       |         |  |        |  |        |      | 
|                                                          |  | m    |         |  | m     |  |        | m   | 
|Assets                                                    |  |       |         |  |        |  |        |      |  |  |         | 
|Cash and balances at central banks                        |  |       | 1,600   |  |        |  | 13     |      |  |  | 1,613   | 
|Items in the course of collection from other banks        |  |       | 560     |  |        |  |       |      |  |  | 560     | 
|Central government and other eligible bills               |  |       | 92      |  |        |  | 1,515  |      |  |  | 1,607   | 
|Loans and advances to banks                               |  |       | 7,783   |  |        |  | 564    |      |  |  | 8,347   | 
|Loans and advances to customers                           |  |       | 79,917  |  |        |  | (81    | )    |  |  | 79,836  | 
|Net securitisation balances                               |  |       | 35      |  |        |  | (35    | )    |  |  |        | 
|Debt securities                                           |  |       | 21,321  |  |        |  | 1,390  |      |  |  | 22,711  | 
|Equity shares                                             |  |       | 52      |  |        |  | 5,664  |      |  |  | 5,716   | 
|Interests in associated undertakings                      |  |       | 17      |  |        |  |       |      |  |  | 17      | 
|Interests in joint ventures                               |  |       | 61      |  |        |  |       |      |  |  | 61      | 
|Intangible assets  Goodwill                              |  |       | 316     |  |        |  | (97    | )    |  |  | 219     | 
|Intangible assets  Other                                 |  |       |        |  |        |  | 573    |      |  |  | 573     | 
|Investment property                                       |  |       |        |  |        |  | 503    |      |  |  | 503     | 
|Property, plant & equipment                               |  |       | 1,236   |  |        |  | (516   | )    |  |  | 720     | 
|Deferred tax asset                                        |  |       |        |  |        |  | 99     |      |  |  | 99      | 
|Other assets                                              |  |       | 4,945   |  |        |  | 253    |      |  |  | 5,198   | 
|Long-term assurance assets                                |  |       | 8,529   |  |        |  | (8,529 | )    |  |  |        | 
|                                                          |  |       |         |  |        |  |        |      | 
|Total assets                                              |  |       | 126,464 |  |        |  | 1,316  |      |  |  | 127,780 | 
|                                                          |  |       |         |  |        |  |        |      | 
|Liabilities                                               |  |       |         |  |        |  |        |      |  |  |         | 
|Deposits by banks                                         |  |       | 20,254  |  |        |  | 611    |      |  |  | 20,865  | 
|Customer accounts                                         |  |       | 60,265  |  |        |  | (80    | )    |  |  | 60,185  | 
|Items in the course of transmission to other banks        |  |       | 230     |  |        |  |       |      |  |  | 230     | 
|Debt securities in issue                                  |  |       | 20,539  |  |        |  | 678    |      |  |  | 21,217  | 
|Other liabilities                                         |  |       | 7,039   |  |        |  | (283   | )    |  |  | 6,756   | 
|Deferred taxation liabilities                             |  |       | 72      |  |        |  | 140    |      |  |  | 212     | 
|Other provisions                                          |  |       | 321     |  |        |  | (141   | )    |  |  | 180     | 
|Post-retirement benefit obligations                       |  |       |        |  |        |  | 924    |      |  |  | 924     | 
|Subordinated liabilities                                  |  |       | 4,086   |  |        |  |       |      |  |  | 4,086   | 
|Life assurance liabilities attributable to policy holders |  |       | 8,734   |  |        |  | (21    | )    |  |  | 8,713   | 
|                                                          |  |       |         |  |        |  |        |      | 
|Total liabilities                                         |  |       | 121,540 |  |        |  | 1,828  |      |  |  | 123,368 | 
|                                                          |  |       |         |  |        |  |        |      | 
|Stockholders funds                                       |  |       | 4,789   |  |        |  | (512   | )    |  |  | 4,277   | 
|Minority interests                                        |  |       | 135     |  |        |  |       |      |  |  | 135     | 
|                                                          |  |       |         |  |        |  |        |      | 
|Total equity and liabilities                              |  |       | 126,464 |  |        |  | 1,316  |      |  |  | 127,780 | 
|                                                          |  |       |         |  |        |  |        |      | 

F-92



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

Consolidated Summary of IFRS Balance Sheet Impacts


Balance Sheet IFRS Reconciliation 31 March 2005


|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      |  |  |      |   |  |  |      |   |  |  |         |  
|--------------------------------------------------------------- |  | ---------- | ------- | ------------- | --- |  | ---------- | --- |  | ------- | -------- | -------- | -------- | --- | --- | ----------- | --- |  | -------- | --- |  | -------- | ---- | - | ------- | --- | --- | ----- | --------- |  | ---- | ---- |  |  | ---- | - |  |  | ---- | - |  |  | ------- | -
|                                                                |  |            |         | Consolidation |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     | 
|                                                                |  |            |         |               |     |  |            |     |  |         | Software |          |          |     |     |             |     |  |          |     |  |         
|                                                                |  |            |         | New           |     |  | Insurance  |     |  |         |          | Employee |          |     | &   |             |     |  |          |     |  |          |      |   |         |    
|                                                                |  |            |         | Entities      |     |  | Businesses |     |  | Leasing |          |          | benefits |     |     | Intangibles |     |  | Goodwill |     |  | Dividend |      |   | Pension |     |     | Other |           |  |     
|                                                                |  | Irish GAAP |         |               | (a) |  |            | (b) |  |         | (h)      |          |          | (e) |     |             | (g) |  |          | (d) |  |          | (i)  |   |         | (f) |     |       | (j) & (k) |  |      | IFRS | 
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 
|                                                                |  | m         |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          | m   |  
|Assets                                                          |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      |  |  |      |   |  |  |      |   |  |  |         |  
|Cash and balances at central banks                              |  |            | 1,600   |               |     |  | 10         |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  | 3    |   |  |  | 1,613   |  
|Items in the course of collection from other banks              |  |            | 560     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 560     |  
|Central government and other eligible bills                     |  |            | 92      |               |     |  |           |     |  |         | 1,515    |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 1,607   |  
|Loans and advances to banks                                     |  |            | 7,783   |               |     |  |           |     |  |         | 567      |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  | (3   | ) |  |  | 8,347   |  
|Loans and advances to customers                                 |  |            | 79,917  |               |     |  | (65        | )   |  |         |         |          |          |     | (16 | )           |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 79,836  |  
|Net securitisation balances                                     |  |            | 35      |               |     |  | (35        | )   |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  |        |  
|Debt securities                                                 |  |            | 21,321  |               |     |  | 1,244      |     |  |         | 146      |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 22,711  |  
|Equity shares                                                   |  |            | 52      |               |     |  |           |     |  |         | 5,664    |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 5,716   |  
|Interests in associated undertakings                            |  |            | 17      |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 17      |  
|Interests in joint ventures                                     |  |            | 61      |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 61      |  
|Intangible assets  Goodwill                                    |  |            | 316     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     | (97 | )     |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 219     |  
|Intangible assets  Other                                       |  |            |        |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          | 464  |   |         |     | 109 |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 573     |  
|Investment property                                             |  |            |        |               |     |  |           |     |  |         | 503      |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 503     |  
|Property, plant & equipment                                     |  |            | 1,236   |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          | (464 | ) |         |     |    |       |           |  |     |      |  |  |     |   |  |  | (52  | ) |  |  | 720     |  
|Deferred tax asset (j)                                          |  |            |        |               |     |  |           |     |  |         |         |          |          |     | 6   |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  | 104  |   |  |  | (11  | ) |  |  | 99      |  
|Other assets                                                    |  |            | 4,945   |               |     |  | 8          |     |  |         | 136      |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  | (42  | ) |  |  | 151  |   |  |  | 5,198   |  
|Life assurance assets attributable to the policyholders         |  |            | 8,529   |               |     |  |           |     |  |         | (8,529   | )        |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  |        |  
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 
|Total assets                                                    |  |            | 126,464 |               |     |  | 1,162      |     |  |         | 2        |          |          |     | (10 | )           |     |  |         |     |  |          |     |   |         |     | 12  |       |           |  |     |      |  |  | 62   |   |  |  | 88   |   |  |  | 127,780 |  
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 
|Equity and liabilities                                          |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      |  |  |      |   |  |  |      |   |  |  |         |  
|Deposits by banks                                               |  |            | 20,254  |               |     |  | 611        |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 20,865  |  
|Customer accounts                                               |  |            | 60,265  |               |     |  | (80        | )   |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 60,185  |  
|Items in the course of transmission to other banks              |  |            | 230     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 230     |  
|Debt securities in issue                                        |  |            | 20,539  |               |     |  | 678        |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 21,217  |  
|Other liabilities                                               |  |            | 7,039   |               |     |  | 8          |     |  |         | 6        |          |          |     | (51 | )           |     |  | (3       | )   |  |          |     |   |         |     |    |       |           |  | (282 | )    |  |  |     |   |  |  | 39   |   |  |  | 6,756   |  
|Deferred tax liabilities (j)                                    |  |            | 72      |               |     |  |           |     |  |         |         |          |          |     | (3  | )           |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  | (26  | ) |  |  | 169  |   |  |  | 212     |  
|Other provisions                                                |  |            | 321     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  | (141 | ) |  |  |     |   |  |  | 180     |  
|Post retirement benefit obligations (f)                         |  |            |        |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  | 924  |   |  |  |     |   |  |  | 924     |  
|Subordinated liabilities                                        |  |            | 4,086   |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 4,086   |  
|Life assurance liabilities attributable to policy holders       |  |            | 8,734   |               |     |  |           |     |  |         | (4       | )        |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  | (17  | ) |  |  | 8,713   |  
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 
|Total liabilities                                               |  |            | 121,540 |               |     |  | 1,217      |     |  |         | 2        |          |          |     | (54 | )           |     |  | (3       | )   |  |          |     |   |         |     |    |       |           |  | (282 | )    |  |  | 757  |   |  |  | 191  |   |  |  | 123,368 |  
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 
|Equity                                                          |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      |  |  |      |   |  |  |      |   |  |  |         |  
|Share capital                                                   |  |            | 663     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 663     |  
|Share premium account                                           |  |            | 765     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 765     |  
|Capital reserve                                                 |  |            | 561     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 561     |  
|Retained profits                                                |  |            | 2,772   |               |     |  | (55        | )   |  |         |         |          |          |     | 44  |             |     |  | 3        |     |  |          |     |   |         |     | 12  |       |           |  | 282  |      |  |  | (695 | ) |  |  | (27  | ) |  |  | 2,336   |  
|Revaluation reserve                                             |  |            | 234     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  | (76  | ) |  |  | 158     |  
|Own shares held for the benefit of life assurance policyholders |  |            | (206    | )             |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | (206    | )
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 
|Stockholders funds                                              |  |            | 4,789   |               |     |  | (55        | )   |  |         |         |          |          |     | 44  |             |     |  | 3        |     |  |          |     |   |         |     | 12  |       |           |  | 282  |      |  |  | (695 | ) |  |  | (103 | ) |  |  | 4,277   |  
|Minority interests                                              |  |            | 135     |               |     |  |           |     |  |         |         |          |          |     |    |             |     |  |         |     |  |          |     |   |         |     |    |       |           |  |     |      |  |  |     |   |  |  |     |   |  |  | 135     |  
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 
|Total equity and liabilities                                    |  |            | 126,464 |               |     |  | 1,162      |     |  |         | 2        |          |          |     | (10 | )           |     |  |         |     |  |          |     |   |         |     | 12  |       |           |  |     |      |  |  | 62   |   |  |  | 88   |   |  |  | 127,780 |  
|                                                                |  |            |         |               |     |  |            |     |  |         |          |          |          |     |     |             |     |  |          |     |  |          |      |   |         |     |     |       |           |  |      |      | 

F-93



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

IFRS Consolidated Opening Balance Sheet at April 1,
2005


|                                                             |  |           |         |      |            |  |         |            |  |  |         | 
|------------------------------------------------------------ |  | --------- | ------- | ---- | ---------- |  | ------- | ---------- |  |  | ------- | 
|                                                             |  |           |         | IFRS |            |  | IFRS    |           
|                                                             |  | IFRS      |         |      | Transition |  |         | Opening    | 
|                                                             |  | 31/3/2005 |         |      | Impact     |  |         | 01/04/2005 | 
|                                                             |  |           |         |      |            |  |         |            | 
|                                                             |  | m        |         |      | m         |  |         | m         | 
|Assets                                                       |  |           |         |      |            |  |         |            |  |  |         | 
|Cash and balances at central banks                           |  |           | 1,613   |      |            |  |        |            |  |  | 1,613   | 
|Items in the course of collection from other banks           |  |           | 560     |      |            |  |        |            |  |  | 560     | 
|Central government and other eligible bills                  |  |           | 1,607   |      |            |  | (1,599  | )          |  |  | 8       | 
|Trading Securities                                           |  |           |        |      |            |  | 1,119   |            |  |  | 1,119   | 
|Derivative financial instruments                             |  |           |        |      |            |  | 2,277   |            |  |  | 2,277   | 
|Other financial assets at fair value through profit and loss |  |           |        |      |            |  | 8,115   |            |  |  | 8,115   | 
|Loans and advances to banks                                  |  |           | 8,347   |      |            |  |        |            |  |  | 8,347   | 
|Loans and advances to customers                              |  |           | 79,836  |      |            |  | 152     |            |  |  | 79,988  | 
|Debt securities                                              |  |           | 22,711  |      |            |  | (22,711 | )          |  |  |        | 
|Equity shares                                                |  |           | 5,716   |      |            |  | (5,716  | )          |  |  |        | 
|Available for sale financial assets                          |  |           |        |      |            |  | 20,752  |            |  |  | 20,752  | 
|Interest in associated undertakings                          |  |           | 17      |      |            |  |        |            |  |  | 17      | 
|Interests in joint ventures                                  |  |           | 61      |      |            |  |        |            |  |  | 61      | 
|Intangible assets  Goodwill                                 |  |           | 219     |      |            |  | 53      |            |  |  | 272     | 
|Intangible assets  Other                                    |  |           | 573     |      |            |  |        |            |  |  | 573     | 
|Investment property                                          |  |           | 503     |      |            |  |        |            |  |  | 503     | 
|Property, plant & equipment                                  |  |           | 720     |      |            |  | 6       |            |  |  | 726     | 
|Deferred tax asset                                           |  |           | 99      |      |            |  | (44     | )          |  |  | 55      | 
|Other assets                                                 |  |           | 5,198   |      |            |  | (2,115  | )          |  |  | 3,083   | 
|                                                             |  |           |         |      |            |  |         |            | 
|Total assets                                                 |  |           | 127,780 |      |            |  | 289     |            |  |  | 128,069 | 
|                                                             |  |           |         |      |            |  |         |            | 
|Liabilities                                                  |  |           |         |      |            |  |         |            |  |  |         | 
|Deposits by banks                                            |  |           | 20,865  |      |            |  |        |            |  |  | 20,865  | 
|Customer accounts                                            |  |           | 60,185  |      |            |  | (115    | )          |  |  | 60,070  | 
|Items in the course of transmission to other banks           |  |           | 230     |      |            |  |        |            |  |  | 230     | 
|Derivative financial instruments                             |  |           |        |      |            |  | 2,167   |            |  |  | 2,167   | 
|Liabilities to customers under investment contracts          |  |           |        |      |            |  | 4,917   |            |  |  | 4,917   | 
|Debt securities in issue                                     |  |           | 21,217  |      |            |  | 26      |            |  |  | 21,243  | 
|Insurance contract liabilities                               |  |           |        |      |            |  | 3,785   |            |  |  | 3,785   | 
|Other liabilities                                            |  |           | 6,756   |      |            |  | (1,789  | )          |  |  | 4,967   | 
|Deferred taxation liabilities                                |  |           | 212     |      |            |  | (68     | )          |  |  | 144     | 
|Other provisions                                             |  |           | 180     |      |            |  |        |            |  |  | 180     | 
|Post-retirement benefit obligations                          |  |           | 924     |      |            |  |        |            |  |  | 924     | 
|Subordinated liabilities                                     |  |           | 4,086   |      |            |  | 127     |            |  |  | 4,213   | 
|Life assurance liabilities attributable to policy holders    |  |           | 8,713   |      |            |  | (8,713  | )          |  |  |        | 
|                                                             |  |           |         |      |            |  |         |            | 
|Total liabilities                                            |  |           | 123,368 |      |            |  | 337     |            |  |  | 123,705 | 
|Stockholders funds                                          |  |           | 4,277   |      |            |  | 28      |            |  |  | 4,305   | 
|Minority interests                                           |  |           | 135     |      |            |  | (76     | )          |  |  | 59      | 
|                                                             |  |           |         |      |            |  |         |            | 
|Total equity and liabilities                                 |  |           | 127,780 |      |            |  | 289     |            |  |  | 128,069 | 
|                                                             |  |           |         |      |            |  |         |            | 

F-94



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

IFRS Opening Balance Sheet Reconciliation April 1,
2005


|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               |  |     |   |  |  |         |   |  |  |         |  
|--------------------------------------------------------------- |  | -------- | ------- | ---------------- | ------------ |  | --------- | -------- |  |  | ------ | - |  | ---------- | ------ | - | --------- |  | ----- | ----------------- |  | -- | ------- | -------------- | -------------- | ------ | ---- | ------------- | ------------- |  | --- | - |  |  | ------- | - |  |  | ------- | -
|                                                                |  |          |         | Reclassification |              |  | Effective |          |  |  |        |   |  |            |        |   |           |  |       | Total adjustments |  |    | Opening |               
|                                                                |  | IFRS     |         |                  | of financial |  |           | interest |  |  | Fair   |   |  | Hedging    |        |   |           |  | Debt/ |                   |  |    |         | on adoption of |                |        | IFRS |              
|                                                                |  | 31 March |         |                  | instruments  |  |           | rates    |  |  | value  |   |  | activities |        |   | Life      |  |       | equity            |  |    |         |                | IAS 32, 39 and |        |      | Balance Sheet |              
|                                                                |  | 2005     |         |                  | (m)          |  |           | (p)      |  |  | option |   |  | (l)        |        |   | Assurance |  |       | (n)               |  |    | Other   |                |                | IFRS 4 |      |               | April 1, 2005 | 
|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               | 
|                                                                |  | m       |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  | m    |                   |  | m |        
|Assets                                                          |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               |  |     |   |  |  |         |   |  |  |         |  
|Cash and balances at central banks                              |  |          | 1,613   |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 1,613   |  
|Items in the course of collection from other banks              |  |          | 560     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 560     |  
|Central government and other eligible bills                     |  |          | 1,607   |                  |              |  |          |          |  |  |       |   |  |            | (1,599 | ) |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | (1,599  | ) |  |  | 8       |  
|Trading securities                                              |  |          |        |                  |              |  | 1,119     |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | 1,119   |   |  |  | 1,119   |  
|Derivative financial instruments                                |  |          |        |                  |              |  | 1,859     |          |  |  |       |   |  |            | 92     |   |           |  | 326   |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | 2,277   |   |  |  | 2,277   |  
|Other financial assets at fair value through profit and loss    |  |          |        |                  |              |  |          |          |  |  |       |   |  |            | 8,146  |   |           |  |      |                   |  |    | (31     | )              |                |        |     |               |               |  |    |   |  |  | 8,115   |   |  |  | 8,115   |  
|Loans and advances to banks                                     |  |          | 8,347   |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 8,347   |  
|Loans and advances to customers                                 |  |          | 79,836  |                  |              |  | 111       |          |  |  | 41     |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | 152     |   |  |  | 79,988  |  
|Debt securities                                                 |  |          | 22,711  |                  |              |  | (21,871   | )        |  |  |       |   |  |            | (871   | ) |           |  |      |                   |  |    | 31      |                |                |        |     |               |               |  |    |   |  |  | (22,711 | ) |  |  |        |  
|Equity shares                                                   |  |          | 5,716   |                  |              |  | (52       | )        |  |  |       |   |  |            | (5,664 | ) |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | (5,716  | ) |  |  |        |  
|Available-for-sale financial assets                             |  |          |        |                  |              |  | 20,667    |          |  |  |       |   |  |            |       |   |           |  | 85    |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | 20,752  |   |  |  | 20,752  |  
|Interests in associated undertakings                            |  |          | 17      |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 17      |  
|Interests in joint ventures                                     |  |          | 61      |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 61      |  
|Intangible assets  Goodwill                                    |  |          | 219     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        | 53   |               |               |  |    |   |  |  | 53      |   |  |  | 272     |  
|Intangible assets  Other                                       |  |          | 573     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 573     |  
|Investment Property                                             |  |          | 503     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 503     |  
|Property, plant & equipment                                     |  |          | 720     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    | 6       |                |                |        |     |               |               |  |    |   |  |  | 6       |   |  |  | 726     |  
|Deferred tax asset                                              |  |          | 99      |                  |              |  | (10       | )        |  |  | (5     | ) |  |            |       |   |           |  | 3     |                   |  |    |        |                |                |        |     |               |               |  | (32 | ) |  |  | (44     | ) |  |  | 55      |  
|Other assets                                                    |  |          | 5,198   |                  |              |  | (1,839    | )        |  |  | 7      |   |  |            | 1      |   |           |  | 1     |                   |  |    | (285    | )              |                |        |     |               |               |  |    |   |  |  | (2,115  | ) |  |  | 3,083   |  
|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               | 
|Total assets                                                    |  |          | 127,780 |                  |              |  | (16       | )        |  |  | 43     |   |  |            | 105    |   |           |  | 415   |                   |  |    | (279    | )              |                |        | 53   |               |               |  | (32 | ) |  |  | 289     |   |  |  | 128,069 |  
|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               | 
|Liabilities                                                     |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               |  |     |   |  |  |         |   |  |  |         |  
|Deposits by banks                                               |  |          | 20,865  |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 20,865  |  
|Customer accounts                                               |  |          | 60,185  |                  |              |  |          |          |  |  |       |   |  |            | (115   | ) |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | (115    | ) |  |  | 60,070  |  
|Items in the course of transmission to other banks              |  |          | 230     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 230     |  
|Derivative financial instruments and other trading liabilities  |  |          |        |                  |              |  | 1,694     |          |  |  |       |   |  |            | 194    |   |           |  | 279   |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | 2,167   |   |  |  | 2,167   |  
|Liabilities to customers under investment contracts             |  |          |        |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    | 4,917   |                |                |        |     |               |               |  |    |   |  |  | 4,917   |   |  |  | 4,917   |  
|Debt securities in issue                                        |  |          | 21,217  |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  | 26    |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | 26      |   |  |  | 21,243  |  
|Insurance contract liabilities                                  |  |          |        |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    | 3,785   |                |                |        |     |               |               |  |    |   |  |  | 3,785   |   |  |  | 3,785   |  
|Other liabilities                                               |  |          | 6,756   |                  |              |  | (1,829    | )        |  |  | 13     |   |  |            | (1     | ) |           |  | (73   | )                 |  |    | 54      |                |                |        | 53   |               |               |  | (6  | ) |  |  | (1,789  | ) |  |  | 4,967   |  
|Deferred tax liabilities                                        |  |          | 212     |                  |              |  | (8        | )        |  |  | 10     |   |  |            | 2      |   |           |  |      |                   |  |    | (48     | )              |                |        |     |               |               |  | (24 | ) |  |  | (68     | ) |  |  | 144     |  
|Other provisions                                                |  |          | 180     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 180     |  
|Post retirement benefit obligations                             |  |          | 924     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 924     |  
|Subordinated liabilities                                        |  |          | 4,086   |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  | 168   |                   |  |    |        |                |                |        | (41  | )             |               |  |    |   |  |  | 127     |   |  |  | 4,213   |  
|Life assurance liabilities attributable to policy holders       |  |          | 8,713   |                  |              |  |          |          |  |  |       |   |  |            | 23     |   |           |  |      |                   |  |    | (8,736  | )              |                |        |     |               |               |  |    |   |  |  | (8,713  | ) |  |  |        |  
|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               | 
|Total liabilities                                               |  |          | 123,368 |                  |              |  | (143      | )        |  |  | 23     |   |  |            | 103    |   |           |  | 400   |                   |  |    | (28     | )              |                |        | 12   |               |               |  | (30 | ) |  |  | 337     |   |  |  | 123,705 |  
|Equity                                                          |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               |  |     |   |  |  |         |   |  |  |         |  
|Share capital                                                   |  |          | 663     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 663     |  
|Share premium account                                           |  |          | 765     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 765     |  
|Capital reserve                                                 |  |          | 561     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    | (251    | )              |                |        |     |               |               |  |    |   |  |  | (251    | ) |  |  | 310     |  
|Retained profits                                                |  |          | 2,336   |                  |              |  | 4         |          |  |  | 20     |   |  |            | 2      |   |           |  | (58   | )                 |  |    |        |                |                |        |     |               |               |  |    |   |  |  | (32     | ) |  |  | 2,304   |  
|Revaluation Reserve                                             |  |          | 158     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | 158     |  
|Cash flow hedge reserve                                         |  |          |        |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  | 67    |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  | 67      |   |  |  | 67      |  
|Available for sale reserve                                      |  |          |        |                  |              |  | 123       |          |  |  |       |   |  |            |       |   |           |  | 6     |                   |  |    |        |                |                |        |     |               |               |  | 1   |   |  |  | 130     |   |  |  | 130     |  
|Other equity reserves                                           |  |          |        |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        | 114  |               |               |  |    |   |  |  | 114     |   |  |  | 114     |  
|Own shares held for the benefit of life assurance policyholders |  |          | (206    | )                |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |        |                |                |        |     |               |               |  |    |   |  |  |        |   |  |  | (206    | )
|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               | 
|Stockholders funds                                              |  |          | 4,277   |                  |              |  | 127       |          |  |  | 20     |   |  |            | 2      |   |           |  | 15    |                   |  |    | (251    | )              |                |        | 114  |               |               |  | 1   |   |  |  | 28      |   |  |  | 4,305   |  
|Minority interests                                              |  |          | 135     |                  |              |  |          |          |  |  |       |   |  |            |       |   |           |  |      |                   |  |    |         |                |                |        | (73  | )             |               |  | (3  | ) |  |  | (76     | ) |  |  | 59      |  
|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               | 
|Total equity and liabilities                                    |  |          | 127,780 |                  |              |  | (16       | )        |  |  | 43     |   |  |            | 105    |   |           |  | 415   |                   |  |    | (279    | )              |                |        | 53   |               |               |  | (32 | ) |  |  | 289     |   |  |  | 128,069 |  
|                                                                |  |          |         |                  |              |  |           |          |  |  |        |   |  |            |        |   |           |  |       |                   |  |    |         |                |                |        |      |               |               | 

F-95



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

Significant differences from Irish GAAP




|                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                             |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                      
|(a)  Consolidation and presentation                                                                                                                                                                                                                                                                                                                                    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                      
|Assets, liabilities and results of all undertakings controlled
    by the Group are consolidated. Control is the ability to direct
    the financial and operating policies of an entity.
    Mortgage and other securitisation vehicles are shown on the
    Balance Sheet using the linked presentation method where
    financial recourse to the Group is limited. |  | All entities controlled by the Group, as well as legally
    independent bodies (Special Purpose Entities) where the
    substance of the relationship indicates that they are controlled
    by the Group, are consolidated. This results in the
    consolidation of a number of funding related special purpose
    entities on the Balance Sheet and increases the assets and
    liabilities of the Group.
    In relation to securitisations, linked presentation is not
    permitted by IFRS. Consequently, the gross assets and related
    funding are separately shown on the Balance Sheet.

F-96



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|(b) Life assurance                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|In order to reflect the different nature of the
    policyholders interests in the life assurance business,
    the assets and liabilities attributable to policyholders are
    classified separately in the Group Balance Sheet while the
    results for the year are consolidated on one line in the profit
    and loss account.
    The Group accounts for the value of the stockholders
    interest in long-term assurance business using the embedded
    value method of accounting. The embedded value is comprised of
    the net tangible and financial assets of the life assurance
    business, including any surpluses retained within the long-term
    business fund and the present value of its in-force business. It
    is computed in accordance with bases accepted in the life
    assurance market. All life assurance products are accounted for
    in the same way; there is no difference between investment
    contracts and insurance contracts.
    Changes in embedded value, which are determined on a post tax
    basis, are included in the profit and loss account, grossed up
    for tax at the Banks effective tax rate. The value of
    in-force asset is shown net of tax on the Balance Sheet. |  | IFRS requires line by line consolidation for all items of income
    and expenditure, assets and liabilities. Consequently, the Group
    is no longer permitted to report the results and balances of the
    life assurance business as one line items. Instead, these
    amounts are broken down and allocated to lines which reflect
    their nature, whether attributable to stockholders or
    policyholders.
    In accordance with IFRS 4, life assurance products are
    classified as either investment contracts, which are accounted
    for in accordance with IAS 39 or insurance contracts, which are
    accounted for under IFRS 4. The principal effects of this change
    on the accounting for investment contracts is the removal of
    that portion of the embedded value which represents the value of
    in-force business relating to those contracts, the recognition
    of an asset for deferred acquisition costs, and the deferral of
    up-front fees received for investment management services;
    deferred acquisition costs and deferred up-front fees are
    amortised over the period of the provision of investment
    management services. The accounting for insurance contracts
    under IFRS 4 is unchanged.
    IFRS requires that the profit and loss account and the value of
    in-force asset in the balance sheet be grossed up based on total
    tax payable by the Group, comprising both policyholder and
    stockholder tax.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|(c)  Investments in associated companies and joint
    ventures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Investments in associated undertakings and joint ventures are
    stated at acquisition cost and unamortised goodwill arising on
    the acquisition, together with the appropriate share of
    post-acquisition reserves.
    Income from associates and joint ventures is shown gross of tax
    with the associated tax impact shown in the tax charge.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | Investments in associates and joint ventures are accounted for
    by the equity method of accounting and are initially recognised
    at cost. Cumulative post-acquisition movements are adjusted
    against the carrying amount of the investment.
    Income from associates and joint ventures is shown net of tax in
    the income statement. Associated tax is no longer included in
    the tax charge.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

F-97



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(d) Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Goodwill arising on acquisitions of subsidiary undertakings
    occurring after 31 March 1998 are capitalised as assets on
    the balance sheet and amortised on a straight line basis over
    their estimated useful economic lives.
    Goodwill on acquisitions prior to 31 March 1998 was charged
    against reserves in the year of acquisition and in the event of
    a subsequent disposal the goodwill would be written back and
    reflected in the profit and loss account.
    Goodwill carried in the Group Balance Sheet is subject to
    impairment review when the carrying amount may not be
    recoverable and is written down by the amount of any impairment
    loss identified in the year.                                                                               |  | Goodwill is no longer amortised. It is tested annually for
    impairment and carried at cost less accumulated impairment
    losses.
    The Group has elected not to revisit goodwill on acquisitions
    prior to transition and as a result, the goodwill recognised in
    the Irish GAAP Balance Sheet at April 1, 2004 has been
    carried forward without adjustment as its deemed cost. Goodwill
    previously written off against reserves has not been
    re-instated.
    As a result, the goodwill charged to the income statement since
    April 1, 2004 has been reversed.                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(e)  Share based payments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Where shares are awarded, or options granted, the charge made to
    the profit and loss account is the difference between the
    intrinsic value at the time the award is made and any
    contribution made by the employee. For options or shares granted
    at market prices, this will not result in any charge in the
    accounts.
    Under the terms of the Groups Revenue approved Save As You
    Earn schemes, employees have the option to purchase shares at a
    discount to the market price. Such schemes are exempted from the
    requirements to charge this difference to the profit and loss
    account over the period of their savings contract.
    Where conditional awards are dependent on performance criteria,
    the cost is spread over the performance period. |  | When shares are awarded, the fair value of the employee services
    received in exchange for the grant of the options or shares is
    recognised as an expense and is charged to the income statement
    over the vesting period. Save As You Earn schemes are not exempt
    from these requirements.
    The charge is determined by reference to the fair value of the
    options or shares granted, which is calculated excluding the
    impact of any non-market vesting conditions. Non-market
    conditions are reflected through the assumptions about the
    number of options or shares that are expected to vest. These
    assumptions are revisited at each balance sheet date.
    This results in a charge to the income statement for each of the
    Groups main share schemes.

F-98



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(f)  Employee Benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Contributions to the Groups defined benefit schemes are
    charged to the profit and loss so as to spread the expected cost
    of pensions, calculated in accordance with the advice of
    qualified actuaries, on a systematic basis over employees
    working lives. Variations from the regular cost are spread over
    the average remaining service life of relevant employees.
    The assets and liabilities of defined benefit pension funds are
    not required to be consolidated on the Balance Sheet.
    The cost of the Groups defined contribution schemes are
    charged to the profit and loss for the period in which they are
    incurred. |  | An asset or liability (net of the associated deferred taxation)
    is recognised in the Balance Sheet in respect of defined benefit
    pension plans. It is the present value of the defined benefit
    obligation at the balance sheet date minus the fair value of
    plan assets, together with adjustments for unrecognised past
    service cost.
    The defined benefit obligation is calculated annually by
    independent actuaries using the projected unit credit method.
    Actuarial gains and losses arising from experience adjustments
    and changes in actuarial assumptions are charged or credited
    directly to reserves through the statement of recognised income
    and expense.
    Past service costs are recognised immediately in income, unless
    the changes to the pension plan are conditional on the employees
    remaining in service for a specified period of time (the vesting
    period). In this case, the past service costs are amortised on a
    straight-line basis over the vesting period.
    As there is an overall deficit on the Groups pension
    schemes when calculated under IFRS, this has been recognised on
    the Balance Sheet on transition, net of deferred tax.

F-99



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(g)  Software and Intangible assets                                                                                                                                                                                                                                                                                                                       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                         
|Computer software is capitalised and included within tangible
    assets where future economic benefits are expected to arise from
    the asset. These assets are amortised over their expected useful
    lives.
    Other intangible assets are recognised if they can be disposed
    of separately, without disposing of the business of the entity. |  | Acquired computer software licenses are capitalised on the basis
    of the costs incurred to acquire and bring to use the specific
    software. These costs are amortised on the basis of their
    expected useful lives.
    Costs that are directly associated with the production of
    identifiable and unique software products controlled by the
    Group and which will probably generate economic benefits
    exceeding costs beyond one year, are recognised as intangible
    assets and amortised over their useful lives. This has resulted
    in the reclassification of computer software from tangible to
    intangible assets.
    Other intangible assets are recognised if they are separable
    from the reporting entity or arise from contractual or other
    legal rights. This includes the payments made for the use of the
    UK Post Office brand and for customer distribution rights
    associated with the use of the UK Post Office network.
    These payments will be amortised over their expected useful life.
|                                                                                                                                                                                                                                                                                                                                                         
|(h) Lessor Accounting                                                                                                                                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                         
|Leasing income is recognised in proportion to the funds invested
    in the lease so as to give a constant rate of return over each
    period after taking account of taxation cash flows.                                                                                                                                                               |  | Leasing income is recognised in proportion to the funds invested
    in the lease so as to give a constant rate of return over each
    period before taking account of taxation cash flows.
    The taxation impacts of leasing are reflected in the income
    statement when they occur.
    This impacts the timing of recognition of income in the profit
    and loss account.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                         
|(i)  Dividends                                                                                                                                                                                                                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                         
|Dividends declared after the period end are recorded in the
    period to which they relate.                                                                                                                                                                                                                                                              |  | Dividends are recorded in the period in which they are
    approved.
    This results in an increase in stockholders funds on transition
    as no liability is recognised in the accounts for proposed
    dividends.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

F-100



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(j)  Deferred tax                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Deferred taxation is recognised on all timing differences where
    the transaction or event that gives rise to an obligation to pay
    more tax in the future or a right to pay less tax in the future,
    have occurred by the balance sheet date using rates of tax that
    have been enacted by the balance sheet date.
    Deferred tax assets are recognised when it is more likely than
    not that they will be recovered.
    Deferred taxation is not provided in respect of timing
    differences arising from the sale or revaluation of fixed assets
    unless, by the balance sheet date, a binding commitment to sell
    the asset has been entered into. |  | Deferred tax is provided on temporary differences arising
    between the tax bases of assets and liabilities and their
    carrying amounts in the financial statements. Deferred tax is
    determined using tax rates that have been enacted or
    substantially enacted by the balance sheet date. Deferred tax
    related to fair value re- measurement of available for sale
    investments and cash flow hedges, or related to the revaluation
    of land and buildings, which are charged or credited directly to
    equity, is also credited or charged directly to equity and is
    subsequently recognised in the income statement together with
    the deferred gain or loss.
    Deferred tax assets are recognised to the extent that it is
    probable that future taxable profit will be available against
    which the temporary differences can be utilised.
    Deferred tax is provided on temporary differences arising from
    investments in subsidiaries and associates, except where the
    timing of the reversal of the temporary difference is controlled
    by the Group and it is probable that the difference will not
    reverse in the foreseeable future.
    The primary areas where deferred taxation is now required to be
    provided where previously not is on property revaluations and
    rolled over capital gains.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(k) Tangible fixed assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Tangible fixed assets may be held at depreciated historical cost
    or a revalued amount. The Groups property portfolio is the
    only tangible fixed asset held at a revalued amount. They were
    revalued on the basis of Existing Use Value.                                                                                                                                                                                                                                                                                                                                                                                                                            |  | Tangible fixed assets may be held at depreciated historical cost
    or fair value. However, these revaluations must be on the basis
    of Open Market Value.
    This has given rise to adjustments to the Groups
    revaluation reserve.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

F-101



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(l)  Derivatives and hedge accounting                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Derivative instruments used for trading purposes or used to
    manage risk in the trading portfolios are measured at fair value
    and the resultant profits and losses are included in dealing
    profits. Unrealised gains and losses are reported in Other
    Assets or Other Liabilities on a gross basis.
    Derivatives used for hedging purposes are taken to the profit
    and loss account in accordance with the accounting treatment of
    the underlying transaction. Accrued income or expense is
    reported in prepayments and accrued income or accruals and
    deferred income on a gross basis.
    Profits and losses related to qualifying hedges of firm
    commitments and anticipated transactions are deferred and taken
    to the profit and loss account when the hedged transactions
    occur. |  | Derivatives are initially recognised at fair value on the date
    on which a derivative contract is entered into and are
    subsequently re-measured at their fair value on the Balance
    Sheet.
    The method of recognising the resulting fair value gain or loss
    depends on whether the derivative is designated as a hedging
    instrument, and if so, the nature of the item being hedged. The
    Group designates certain derivatives as either: (1) hedges
    of the fair value of recognised assets or liabilities or firm
    commitments (fair value hedge); or, (2) hedges of highly
    probable future cash flows attributable to a recognised asset or
    liability, or a forecasted transaction (cash flow hedge).
    Changes in the fair value of derivatives that are designated and
    qualify as fair value hedges are recorded in the income
    statement, together with any changes in the fair value of the
    hedged asset or liability that are attributable to the hedged
    risk.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | The effective portion of changes in the fair value of
    derivatives that are designated and qualify as cash-flow hedges
    are recognised in equity. The gain or loss relating to the
    ineffective portion is recognised immediately in the income
    statement. Amounts accumulated in equity are recycled to the
    income statement in the periods in which the hedged item will
    affect profit or loss.
    Certain derivative instruments do not qualify for hedge
    accounting. Changes in their fair value are recognised
    immediately in the income statement.
    The Group has primarily applied macro cash-flow hedging to
    derivatives hedging its funding base together with the use of a
    limited number of micro fair value hedges for large ticket
    transactions. The fair value of these derivatives is now
    reflected on the Balance Sheet.                                                                                                                                    

F-102



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | As a result of the strict hedge accounting rules in IAS 39,
    hedge accounting is likely to introduce volatility into to the
    income statement to the extent that hedging relationships prove
    ineffective.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(m) Classification and measurement of financial
    instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Under Irish GAAP, financial instruments are classified as either
    investment securities or other securities. Debt securities and
    equity shares held for use on a continuing basis in the
    Groups activities are classified as investment securities.
    Such securities and shares are stated at cost less provision for
    any permanent diminution in value.
    Other securities and other equity shares are stated at fair
    value using mid-market values, except for those securities
    maintained for the purpose of hedging, which are accounted for
    on the same basis as the item hedged. Changes in the fair value
    of securities marked to market are recognised in the profit and
    loss account as they arise and included in dealing profits. |  | Under IFRS, financial instruments are classified as either(a) Financial assets at fair value through profit or lossA financial asset is classified in this category if acquired
    principally for the purpose of selling in the short term or if
    so designated by management.(b) Loans and receivablesThis category includes non-derivative financial assets with
    fixed or determinable payments that are not quoted in an active
    market.(c) Held-to-maturityHeld-to-maturity investments are non-derivative financial
    assets with fixed or determinable payments and fixed maturities
    that the Groups management has the positive intention and
    ability to hold to maturity.(d) Available-for-saleAvailable-for-sale investments are those intended to be held
    for an indefinite period of time, which may be sold in response
    to needs for liquidity or changes in interest rates, exchange
    rates or equity prices.
    Financial assets are initially recognised at fair value plus
    transaction costs. Available-for-sale and financial assets at
    fair value through profit or loss are subsequently carried at
    fair value whereas loans and receivables and held-to-maturity
    investments are subsequently carried at amortised cost using the
    effective interest method.

F-103



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | A large portion of the Groups debt securities, previously
    classified as both trading and investment, have been
    reclassified as available for sale. The fair value movements
    will pass through the available for sale reserve.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(n) Issued debt and equity securities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Under Irish GAAP, capital instruments which contain an
    obligation to transfer economic benefits to another party are
    classified as debt.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | Instruments which carry a contractual obligation to deliver cash
    or another financial asset to another entity are classified as
    financial liabilities. The dividends on these instruments are
    recognised in the income statement as interest expense.
    Where there is discretion in relation to the payment of a
    dividend, the instrument is classified as equity and the
    payments are included as preference dividends.
    As a result, the Stg£50.4m non cumulative preference shares
    have been classified as debt while the U.S.$150m undated
    floating rate primary capital notes have been classified as
    equity.                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(o)  Loan impairment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Specific provisions are made for loans and advances when the
    Group consider that the creditworthiness of a borrower has
    deteriorated such that the recovery of the whole or part of an
    outstanding advance is in serious doubt.
    Specific provisions are generally raised on an individual basis,
    although specific provisions may be raised on a portfolio basis
    for homogeneous assets and where statistical techniques are
    appropriate.
    General provisions are raised to cover latent loan losses which
    are known from experience to be present at the balance sheet
    date but have yet to be specifically identified.
    If collection of interest is doubtful, it is credited to a
    suspense account and excluded from interest income in the profit
    and loss account. The suspense account in the balance sheet is
    netted against the relevant loan. |  | Impairment losses are recognised where there is objective
    evidence of impairment as a result of one or more loss events
    that have occurred and where these events have had an impact on
    the estimated future cash flows of the financial asset or
    portfolio of financial assets and is measured based on the
    difference between the carrying amount and the present value of
    the estimated future cashflows, discounted at the original
    effective interest rate.
    Impairment is measured individually for assets that are
    individually significant and on a collective basis for
    portfolios with similar risk characteristics.
    Provisions for incurred losses that observable data indicates
    are present in the portfolio but have not yet been specifically
    identified are also raised.
    The Banks assessment of the overall level of credit
    impairment is unchanged. However, the application of IFRS has
    resulted in a re-analysis of the Irish GAAP general and specific
    provisions into IFRS impairment allowances.

F-104



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|46 | RECONCILIATION OF IR GAAP TO IFRS  (continued)

|                                                                                                                                                                                                                                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Irish GAAP                                                                                                                                                                                                                                      |  | IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(p) Effective Interest Rate                                                                                                                                                                                                                     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                               
|Interest income is recognised as it accrues.
    Fees and commissions which represent a return for services
    provided, risk borne or which are in the nature of interest are
    generally credited to income when the service is performed. |  | Interest income and expense are recognised in the income
    statement using the effective interest rate. This rate includes
    all fees and points paid or received between parties to the
    contract, transaction costs and all other premiums or
    discounts.
    Fees earned on the execution of a significant act are recognised
    immediately.
    The application of IFRS has resulted in certain upfront fees and
    expenses being included in interest income and spread over the
    expected life of the underlying asset, rather than being taken
    upfront.
|                                                                                                                                                                                                                                               
|(q) Offset                                                                                                                                                                                                                                      |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                               
|Under Irish GAAP, an intention to settle net is not a
    requirement for offset, the entity must have the ability to
    insist on net settlement and that ability is assured beyond
    doubt.                                                |  | For a financial asset and financial liability to be offset, an
    entity must intend to settle on a net basis or to realise the
    asset and settle the liability simultaneously.
    As a result of this change, on April 1, 2005, the Balance
    Sheet has been grossed up for interbank derivatives which,
    although subject to set off arrangements, are not intended to be
    settled on a net basis.                                                                                                                                                                  



|   |                       
|-- | ----------------------
|47 | DIRECTORS INFORMATION





F-105



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)



Remuneration policy


The reward package for executive Directors and senior
management






| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Salary  Is payable monthly and is set at a
    level to recognise an individuals market worth. Salaries
    are reviewed annually by the Group Remuneration Committee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |  | Performance-related bonus scheme  The level
    earned by each executive Director is a function of the
    Remuneration Committees assessment of that Directors
    performance against pre-determined goals, required leadership
    behaviours and the overall performance of the Group in any year
    in absolute terms. The maximum bonus potential of executive
    Directors and Group Executive Committee members is currently
    125% of salary. 25% of the actual bonus awarded is deferred
    until the earlier of March 2009 or the completion of the
    Strategic Transformation Programme.                                                                                                                                                                                                                       
|
| |  | Long Term Incentive Plan  Since 2004 the Group
    has operated a Long Term Incentive Plan (LTIP), with
    stockholder approval, for key senior executives who are best
    placed to maximise stockholder value. This replaced the Long
    Term Performance Stock Plan (LTPSP), which operated
    from 1999 to 2003. Under this Plan, and its predecessor, the
    LTPSP, which is described in more detail in Note 38 on
    page F-77,
    conditional awards have been made to the executive Directors as
    set out in the table on
    page F-111.                                                                                                                                                                                                                                                                    
|
| |  | Stock options  In 2004, the Group updated the
    Executive Stock Option Scheme, with stockholder approval. This
    involved amending the previous Executive Stock Option Scheme
    introduced in 1996. It is policy to grant stock options under
    the terms of the Stock Option Scheme to executive Directors and
    senior executives across the Group to encourage identification
    with the interests of stockholders in general. The exercise of
    all options granted since 2004 is conditional upon underlying
    earnings per share achieving a cumulative growth of at least 5%
    per annum compound above the increase in the Consumer Price
    Index over the three-year performance period. If this
    performance condition is not achieved, the options lapse. (See
    also Note 38 on
    page F-76).

F-106



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Employee Stock Issue Scheme  The Bank operates
    an Employee Stock Issue Scheme under which the Court of
    Directors may set aside an element of Group profit before
    taxation for allocation to the trustees of the scheme to enable
    them to acquire units of ordinary stock on behalf of the scheme
    participants. The amount set aside is related to overall Group
    performance (See also Note 38 on
    page F-75).
    Executive Directors participate on the same basis as staff
    generally.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | Sharesave Scheme  In 1999 the Group
    established a Sharesave Scheme (SAYE scheme). Under
    this scheme the executive Directors who participated in the
    scheme were granted options over units of Ordinary Stock as set
    out in the table on
    page F-110. (see
    Note 38 on
    page F-75). Under
    the scheme, first offered in 2000, participants could save for
    three, five or seven years. The three year scheme matured in May
    2003 and the five year scheme matured in May 2005. A further
    offer under the scheme was made in December 2003. Under the 2003
    offer, participants could save for three or five years. It is
    the Groups practice to consider further offers under the
    scheme from time to time.                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | Pensions  The executive Directors are members
    of the Bank Staff Pensions Fund and have a normal retirement age
    of 60. This pension plan is contributory at the rate of 2.5% of
    salary and is a defined benefit plan based on an accrual rate of
    1/60th of pensionable salary for each year of pensionable
    service with a maximum of 40/60ths payable at age 60. Of the
    executive Directors total remuneration package, only their
    salary is pensionable. The Finance Act 2006 has introduced an
    additional tax, at 42%, on the excess capital value
    of pensions over a specified cap of
    5m, or the value
    of individual pension entitlements at December 7, 2005, if
    greater. For members of defined benefit schemes, the capital
    value is calculated as 20 times the annual pension, and the
    tax is payable at the first benefit crystallisation
    event (in effect, when the pension first becomes payable).
    These provisions have an immediate impact on the value of the
    pension benefits accruing to one executive director (see
    Directors pension entitlements
    page F-112) and a
    potential impact on a second executive director.
|
| |  | Service contracts  No service contract exists
    between the Bank and any Director which provides for a notice
    period from the Group of greater than one year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

F-107



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)

Directors remuneration 2005/2006 (all figures in
000s)


|                                                        |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  |       |       |  |  |       |       | 
|------------------------------------------------------- | ------ | ------ | ----- | ----- | ---- |  | ----- | ----- |  | ----- | ------ | ----- |  | -------- | ------- | -- | --------- | ----- | -- | --------- | ----- |  | --------- | --- |  |  | ----- | ----- |  |  | ----- | ----- | 
|                                                        |        |        |       | Court |      |  | Perf. |       |  | Other |        |       |  |          | Pension |    |           | Total |    |           | Total | 
|                                                        |        | Salary |       |       | fees |  |       | bonus |  |       | remun. |       |  | Benefits |         |    | contribs. |       |    | remun.    |       |  | remun.    |    
|                                                        |        | (1)    |       |       | (2)  |  |       | (3)   |  |       | (4)    |       |  | (5)      |         |    | (6)       |       |    | 2005/2006 |       |  | 2004/2005 |    
|                                                        |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |    
|Governor                                                |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  |       |       |  |  |       |      
|R Burrows (apt. Governor 06.07.2005)                    |        |        | 336   |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 336   |       |  |  | 148   |      
|Deputy Governor                                         |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  |       |       |  |  |       |      
|D OBrien (apt. Deputy Governor 14.9.2005)              |        |        | 124   |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 124   |       |  |  | 77    |      
|Executive Directors                                     |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  |       |       |  |  |       |      
|B J Goggin*                                             |        |        | 1,000 |       |      |  |       |       |  |       | 1,280  |       |  |          | 27      |    |           |       | 50 |           |       |  | 168       |     |  |  | 2,525 |       |  |  | 1,919 |      
|J ODonovan                                             |        |        | 450   |       |      |  |       |       |  |       | 405    |       |  |          | 13      |    |           |       | 31 |           |       |  | 216       |     |  |  | 1,115 |       |  |  | 847   |      
|Non  Executive Directors                               |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  |       |       |  |  |       |      
|R E Bailie                                              |        |        |       |       |      |  | 112   |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 112   |       |  |  | 107   |      
|L G Crowley (retired 6.7.2005)                          |        |        | 106   |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  | 10        |     |  |  | 116   |       |  |  | 419   |      
|D J Dilger                                              |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 77    |      
|D J Geaney (Deceased 7.10.2005)                         |        |        |       |       |      |  | 42    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 42    |       |  |  | 77    |      
|P Haran                                                 |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 17    |      
|M Hodgkinson (7)                                        |        |        |       |       |      |  | 0     |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 0     |       |  |  | 0     |      
|R MacSharry (retired 6.7.2005)                          |        |        |       |       |      |  | 21    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 21    |       |  |  | 77    |      
|D McCourt                                               |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 76    |      
|G M Magan                                               |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 77    |      
|C A Marland                                             |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 77    |      
|T Moran                                                 |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 77    |      
|T V Neill                                               |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 76    |      
|M Redmond                                               |        |        |       |       |      |  | 80    |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 80    |       |  |  | 77    |      
|                                                        |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |    
|                                                        | Totals |        |       | 2,016 |      |  |       | 815   |  |       |        | 1,685 |  |          |         | 40 |           |       |    | 81        |       |  |           | 394 |  |  |       | 5,031 |  |  |       | 4,225 | 
|                                                        |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |    
|Ex gratia payments paid to former Directors/ Dependents |        |        |       |       |      |  |       |       |  |       |        |       |  |          |         |    |           |       |    |           |       |  |           |     |  |  | 474   |       |  |  | 545   |      








|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The Governor and Deputy Governor, as non-executive Officers of
    the Bank, are not paid Court fees but are remunerated by way of
    non-pensionable salary.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|(2) | Court fees are paid only to non-executive Directors and are
    subject to review annually at June each year.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|(3) | Payments under the performance bonus scheme are linked to
    individual performance and overall Group performance versus
    targets over the financial year. Under the rules of the
    performance bonus plan, 25% of any actual bonus awarded is
    deferred until the earlier of March 2009 or the completion of
    the Strategic Transformation Programme. For the year 05/06 Brian
    Goggin is awarded a total performance bonus of
    1,200,000 of
    which 900,000 is
    payable in June 2006 and
    300,000 (25%) is
    deferred. In addition to this performance bonus, under the Asset
    Management Services (AMS) 2003 Long Term Incentive
    Programme, Brian Goggin will receive a payment of
    380,000 in June
    2006. For the year 2005/06 John ODonovan was awarded a
    total performance bonus of
    540,000 of which
    405,000 is
    payable in June 2006 and
    135,000 (25%) is
    deferred.
|   
|(4) | Includes the cash value of Ordinary Stock receivable under the
    Employee Stock Issue Scheme.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|(5) | Benefits include car allowance and interest on any loans at
    staff rates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   
|(6) | Contributions to defined benefit pension schemes. The fees paid
    or payable to non-executive Directors appointed post April 1991
    are not pensionable. As Laurence Crowley was appointed a
    Director pre April 1991, an element of his salary, equivalent to
    the standard directors fee, has been treated as pensionable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

F-108



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)



|    |                                                                                                                                                                                                                                                                                                                                                          
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(7) | Mike Hodgkinson receives no emoluments from the Bank of Ireland
    Group in line with the agreement with Post Office Ltd. Brian
    Goggin who sits on the Board of the UK Post Office Ltd. also
    receives no emoluments from that Board.                                                                                                            
|   
|*   | Prior to his appointment as Group Chief Executive in June 2004,
    Brian Goggin, while Chief Executive of the Asset Management
    Services Division, participated in that Divisions Deferred
    Cash Incentive Scheme and a Long Term Incentive Programme, in
    lieu of the Bank of Ireland Groups Executive Long Term
    Performance Stock Plan.

Deferred Cash Incentive Scheme 





Stock options held by Directors and Secretary




|    |                        
|--- | -----------------------
|(a) | Executive stock options



|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  |         | 
|------------ |  | ------------ |  | ------------- |  | ------------ |  | -------- | ----- | ------------- | ----------- |  | ------- | ---------- |  |  | --------- |  |  | ---------- | ------ |  | --------- |  | ----- |  |  |  | ------- | 
|             |  |              |  |               |  |              |  |          |       | Options at    |             |  |         |            |  |  |           |  | 
|             |  |              |  |               |  |              |  |          |       | April 1, 2005 |             |  |         |            |  |  | Market    |  |  |           
|             |  |              |  |               |  |              |  |          |       | or date of    |             |  |         |            |  |  | price at  |  |  | Options at |       
|             |  | Date of      |  | Earliest      |  |              |  | Exercise |       |               | appointment |  |         | Granted in |  |  | Exercised |  |  | exercise   |        |  | March 31, | 
|             |  | grant        |  | exercise date |  | Expiry date  |  | price    |       |               | if later    |  |         | year       |  |  | in year   |  |  | date       |        |  | 2006      | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           | 
|             |  |              |  |               |  |              |  |         |       |               |             |  |         |            |  |  |          |  |  |           
|Directors    |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  |         | 
|B J Goggin   |  | Nov 28, 1996 |  | Nov 28, 1999  |  | Nov 28, 2006 |  |          | 3.24  |               |             |  | 80,000  |            |  |  |           |  |  |            | 80,000 |  |           |  | 12.08 |  |  |  |         | 
|             |  | Jul 13, 1999 |  | Jul 13, 2002  |  | Jul 13, 2009 |  |          | 8.93  |               |             |  | 20,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 20,000  | 
|             |  | May 21, 2001 |  | May 21, 2004  |  | May 24, 2011 |  |          | 11.05 |               |             |  | 25,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 25,000  | 
|             |  | Jun 24, 2002 |  | Jun 24, 2005  |  | Jun 24, 2012 |  |          | 12.5  |               |             |  | 25,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 25,000  | 
|             |  | Jun 18, 2003 |  | Jun 18, 2006  |  | Jun 18, 2013 |  |          | 10.77 |               |             |  | 50,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 50,000  | 
|             |  | Jul 26, 2004 |  | Jul 26, 2007  |  | Jul 26, 2014 |  |          | 10.76 |               |             |  | 92,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 92,000  | 
|             |  | Jun 21, 2005 |  | Jun 21, 2008  |  | Jun 21, 2015 |  |          | 12.85 |               |             |  |         |            |  |  | 77,500    |  |  |            |        |  |           |  |       |  |  |  | 77,500  | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           | 
|             |  |              |  |               |  |              |  |          |       |               |             |  | 292,000 |            |  |  | 77,500    |  |  |            | 80,000 |  |           |  |       |  |  |  | 289,500 | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           | 
|J ODonovan  |  | Nov 26, 2001 |  | Nov 26, 2004  |  | Nov 26, 2011 |  |          | 10.54 |               |             |  | 15,000  |            |  |  |           |  |  |            | 10,000 |  |           |  | 13.02 |  |  |  |         | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            | 5,000  |  |           |  | 15.28 |  |  |  |         | 
|             |  | Jun 24, 2002 |  | Jun 24, 2005  |  | Jun 24, 2012 |  |          | 12.5  |               |             |  | 25,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 25,000  | 
|             |  | Jun 18, 2003 |  | Jun 18, 2006  |  | Jun 18, 2013 |  |          | 10.77 |               |             |  | 50,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 50,000  | 
|             |  | Jul 26, 2004 |  | Jul 26, 2007  |  | Jul 26, 2014 |  |          | 10.76 |               |             |  | 35,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 35,000  | 
|             |  | Jun 21, 2005 |  | Jun 21, 2008  |  | Jun 21, 2015 |  |          | 12.85 |               |             |  |         |            |  |  | 32,500    |  |  |            |        |  |           |  |       |  |  |  | 32,500  | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           | 
|             |  |              |  |               |  |              |  |          |       |               |             |  | 125,000 |            |  |  | 32,500    |  |  |            | 15,000 |  |           |  |       |  |  |  | 142,500 | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           | 
|Secretary    |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  |         | 
|J B Clifford |  | Jun 05, 1996 |  | Jun 05, 1999  |  | Jun 05, 2006 |  |          | 2.82  |               |             |  | 60,000  |            |  |  |           |  |  |            | 60,000 |  |           |  | 15.05 |  |  |  |         | 
|             |  | May 25, 2000 |  | May 25, 2003  |  | May 25, 2010 |  |          | 6.96  |               |             |  | 15,000  |            |  |  |           |  |  |            | 15,000 |  |           |  | 15.05 |  |  |  |         | 
|             |  | Jun 24, 2002 |  | Jun 24, 2005  |  | Jun 24, 2012 |  |          | 12.5  |               |             |  | 10,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 10,000  | 
|             |  | Jun 18, 2003 |  | Jun 18, 2006  |  | Jun 18, 2013 |  |          | 10.77 |               |             |  | 20,000  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 20,000  | 
|             |  | Jul 26, 2004 |  | Jul 26, 2007  |  | Jul 26, 2014 |  |          | 10.76 |               |             |  | 21,500  |            |  |  |           |  |  |            |        |  |           |  |       |  |  |  | 21,500  | 
|             |  | Jun 21, 2005 |  | Jun 21, 2008  |  | Jun 21, 2015 |  |          | 12.85 |               |             |  |         |            |  |  | 13,000    |  |  |            |        |  |           |  |       |  |  |  | 13,000  | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           | 
|             |  |              |  |               |  |              |  |          |       |               |             |  | 126,500 |            |  |  | 13,000    |  |  |            | 75,000 |  |           |  |       |  |  |  | 64,500  | 
|             |  |              |  |               |  |              |  |          |       |               |             |  |         |            |  |  |           |  |  |            |        |  |           | 

F-109



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)







|    |                              
|--- | -----------------------------
|(b) | Sharesave Scheme options 2000




|           |  |                    |       |  |                     |  |       |           |  |  |          |              |  |            |                |  |                 |  |  |  |  |  |       | 
|---------- |  | ------------------ | ----- |  | ------------------- |  | ----- | --------- |  |  | -------- | ------------ |  | ---------- | -------------- |  | --------------- |  |  |  |  |  | ----- | 
|           |  | 2000 Sharesave     |       |  | Market value        |  |       |           |  |  |          | Market value |  |            | 2000 Sharesave | 
|           |  | options granted at |       |  | at date of Grant    |  |       | Options   |  |  | Date of  |              |  | at date of |                |  | options held at | 
|Name       |  | February 28, 2000  |       |  | (February 28, 2000) |  |       | Exercised |  |  | Exercise |              |  | exercise   |                |  | 31 March 2006   | 
|           |  |                    |       |  |                     |  |       |           |  |  |          |              |  |            |                |  |                 | 
|Directors: |  |                    |       |  |                     |  |       |           |  |  |          |              |  |            |                |  |                 |  |  |  |  |  |       | 
|B J Goggin |  |                    | 4,261 |  |                     |  | 6.07 |           |  |  |          |              |  |            |                |  |                 |  |  |  |  |  | 4,261 | 



|    |                              
|--- | -----------------------------
|(c) | Sharesave Scheme options 2003

 


|             |  |                    |       |  |                     |  |        |                 |  |  |       | 
|------------ |  | ------------------ | ----- |  | ------------------- |  | ------ | --------------- |  |  | ----- | 
|             |  | 2003 Sharesave     |       |  | Market value        |  |        | 2003 Sharesave  | 
|             |  | options granted at |       |  | at date of Grant    |  |        | options held At | 
|Name         |  | December 15, 2003  |       |  | (December 15, 2003) |  |        | 31 March 2006   | 
|             |  |                    |       |  |                     |  |        |                 | 
|Directors:   |  |                    |       |  |                     |  |        |                 |  |  |       | 
|J ODonovan  |  |                    | 2,653 |  |                     |  | 10.60 |                 |  |  | 2,653 | 
|Secretary:   |  |                    |       |  |                     |  |        |                 |  |  |       | 
|J B Clifford |  |                    | 1,522 |  |                     |  | 10.60 |                 |  |  | 1,522 | 

F-110



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)



|    |                                  
|--- | ---------------------------------
|(d) | Long Term Incentive Plan (LTIP)

F-77).


|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |         |  |  |  |               |  |  |  |               | 
|------------ |  | ------- | ------------- | ------------- | ------------- |  | ------------- | ---------- |  | ------ | ------- |  |  | ----------- | --------- |  | ----------- |  | ------ | -------------- |  |  | ------------- |  |  | ------------- | ------- |  |  |  | ------------- |  |  |  | ------------- | 
|             |  |         |               | No. of shares |               |  |               |            |  |        |         |  |  |             | Potential |  |             |  |        |               
|             |  |         |               | conditionally |               |  | Conditionally |            |  | Vested |         |  |  |             |           |  | interest in |  |        |                |  | 
|             |  | Date of |               |               | held at       |  |               | awarded in |  |        | in the  |  |  | Retained in |           |  | Lapsed in   |  |        | shares at      |  |  | Original      |  |  |              
|             |  | Award   |               |               | April 1, 2005 |  |               | the year*  |  |        | year**  |  |  | Scheme***   |           |  | the year    |  |        | March 31, 2006 |  |  | Maturity Date |  |  | Maturity Date |        
|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |        
|Directors    |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |         |  |  |  |               |  |  |  |               | 
|B J Goggin   |  |         | July 13, 1999 |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  | 9,221  |                |  |  |               |  |  |               | 11,526  |  |  |  | July 13, 2002 |  |  |  | July 13, 2009 | 
|             |  |         | May 25, 2000  |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  | 16,249 |                |  |  |               |  |  |               | 20,311  |  |  |  | May 25, 2003  |  |  |  | May 25, 2010  | 
|             |  |         | May 21, 2001  |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  | 8,649  |                |  |  |               |  |  |               | 10,379  |  |  |  | May 21, 2004  |  |  |  | May 21, 2006  | 
|             |  |         | June 24, 2002 |               |               |  | 13,763        |            |  |        |         |  |  |             | 6,882     |  |             |  | 6,882  |                |  |  | 6,881         |  |  |               | 8,258   |  |  |  | June 24, 2005 |  |  |  | June 24, 2007 | 
|             |  |         | July 26, 2004 |               |               |  | 139,000       |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 139,000 |  |  |  | July 26, 2007 |  |  |  |               | 
|             |  |         | June 21, 2005 |               |               |  |               |            |  |        | 116,500 |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 116,500 |  |  |  | June 21, 2008 |  |  |  |               | 
|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |        
|             |  |         |               |               |               |  | 152,763       |            |  |        | 116,500 |  |  |             | 6,882     |  |             |  | 41,001 |                |  |  | 6,881         |  |  |               | 305,974 |  |  |  |               |  |  |  |               | 
|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |        
|J ODonovan  |  |         | June 24, 2002 |               |               |  | 10,055        |            |  |        |         |  |  |             | 5,028     |  |             |  | 5,028  |                |  |  | 5,027         |  |  |               | 6,034   |  |  |  | June 24, 2005 |  |  |  | June 24, 2007 | 
|             |  |         | June 18, 2003 |               |               |  | 14,058        |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 14,058  |  |  |  | June 18, 2006 |  |  |  |               | 
|             |  |         | July 26, 2004 |               |               |  | 35,000        |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 35,000  |  |  |  | July 26, 2007 |  |  |  |               | 
|             |  |         | June 21, 2005 |               |               |  |               |            |  |        | 32,500  |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 32,500  |  |  |  | June 21, 2008 |  |  |  |               | 
|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |        
|             |  |         |               |               |               |  | 59,113        |            |  |        | 32,500  |  |  |             | 5,028     |  |             |  | 5,028  |                |  |  | 5,027         |  |  |               | 87,592  |  |  |  |               |  |  |  |               | 
|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |        
|Secretary    |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |         |  |  |  |               |  |  |  |               | 
|J B Clifford |  |         | July 13, 1999 |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  | 7,648  |                |  |  |               |  |  |               | 11,472  |  |  |  | July 13, 2002 |  |  |  | July 13, 2009 | 
|             |  |         | May 25, 2000  |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  | 12,271 |                |  |  |               |  |  |               | 15,339  |  |  |  | May 25, 2003  |  |  |  | May 25, 2010  | 
|             |  |         | May 21, 2001  |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  | 4,803  |                |  |  |               |  |  |               | 5,764   |  |  |  | May 21, 2004  |  |  |  | May 21, 2006  | 
|             |  |         | June 24, 2002 |               |               |  | 5,703         |            |  |        |         |  |  |             | 2,852     |  |             |  | 2,852  |                |  |  | 2,851         |  |  |               | 3,422   |  |  |  | June 24, 2005 |  |  |  | June 24, 2007 | 
|             |  |         | June 18, 2003 |               |               |  | 8,330         |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 8,330   |  |  |  | June 18, 2006 |  |  |  |               | 
|             |  |         | July 26, 2004 |               |               |  | 15,000        |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 15,000  |  |  |  | July 26, 2007 |  |  |  |               | 
|             |  |         | June 21, 2005 |               |               |  |               |            |  |        | 9,500   |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               | 9,500   |  |  |  | June 21, 2008 |  |  |  |               | 
|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |        
|             |  |         |               |               |               |  | 29,033        |            |  |        | 9,500   |  |  |             | 2,852     |  |             |  | 27,574 |                |  |  | 2,851         |  |  |               | 68,827  |  |  |  |               |  |  |  |               | 
|             |  |         |               |               |               |  |               |            |  |        |         |  |  |             |           |  |             |  |        |                |  |  |               |  |  |               |        






|    |                                                                                                                                                                                                                                                                                                                    
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|*   | Market price at date of award
    12.85                                                                                                                                                                                                                                                                           
|   
|**  | Market price at date of vesting
    12.95                                                                                                                                                                                                                                                                         
|   
|*** | Only applies to awards made under the LTPSP. Minimum of 80% of
    the vested stock must be retained for two years from maturity of
    award. After the two year retention period, an additional award
    of 20% is made. If the award is retained for an additional
    5 years, a further award of 30% is made.

F-111



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)

Changes in the directorate during the period


|                                           |  |                     |  |           |                                      |  |  |  |  |  |               |  |  |  |              | 
|------------------------------------------ |  | ------------------- |  | --------- | ------------------------------------ |  |  |  |  |  | ------------- |  |  |  | ------------ | 
|                                           |  | Executive Directors |  |           | Non-executive Directors and Officers | 
|                                           |  |                     |  |           |                                      | 
|Number at 31 March 2005                    |  | 2                   |  | 15       
|Changes during year                        |  |                     |  |           |                                      |  |  |  |  |  | - LG Crowley  |  |  |  | (06/07/2005) | 
|                                           |  |                     |  |           |                                      |  |  |  |  |  | - R MacSharry |  |  |  | (06/07/2005) | 
|                                           |  |                     |  |           |                                      |  |  |  |  |  | - DJ Geaney   |  |  |  | (07/10/2005) | 
|Number at 31 March 2006                    |  | 2                   |  | 12       
|Average number during 2005/2006(2004/2005) |  | 2 (2.2)             |  | 13 (15.1)

Directors pension entitlements




|                      |  |                    |                |  |                      |     |                 |                 |  |  |       | 
|--------------------- |  | ------------------ | -------------- |  | -------------------- | --- | --------------- | --------------- |  |  | ----- | 
|                      |  |                    |                |  |                      | (c) |                
|                      |  | (a)                |                |  | (b)                  |     |                 | Accrued pension | 
|                      |  | Additional pension |                |  | Increase/decrease in |     |                 | entitlement at  | 
|                      |  | earned in the year |                |  | transfer value       |     |                 | 31 March 2006   | 
|                      |  |                    |                |  |                      |     |                 |                 | 
|                      |  | 000               |                |  | 000                 |     |                 | 000            | 
|Executive Directors   |  |                    |                |  |                      |     |                 |                 |  |  |       | 
|B J Goggin            |  |                    | (2.3) (note 1) |  |                      |     | (66.5) (note 1) |                 |  |  | 606.9 | 
|J ODonovan           |  |                    | 24.3           |  |                      |     | 370.8           |                 |  |  | 183.1 | 
|Non-executive Officer |  |                    |                |  |                      |     |                 |                 |  |  |       | 
|L G Crowley           |  |                    | 1.5            |  |                      |     | 28.8            |                 |  |  | 34.6  | 










F-68).


F-112



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                    
|-- | -----------------------------------
|47 | DIRECTORS INFORMATION  (continued)

Directors interests in stock




|               |  |                                  |         |  |                     |  |         | 
|-------------- |  | -------------------------------- | ------- |  | ------------------- |  | ------- | 
|               |  | UNITS OF 0.64 OF ORDINARY STOCK |        
|               |  |                                  |        
|               |  | As at 31 March 2006              |         |  | As at April 1, 2005 | 
|               |  | Beneficial                       |         |  | Beneficial          | 
|               |  |                                  |         |  |                     | 
|DIRECTORS      |  |                                  |         |  |                     |  |         | 
|R E Bailie     |  |                                  | 4,267   |  |                     |  | 3,808   | 
|R Burrows      |  |                                  | 99,598  |  |                     |  | 46,590  | 
|D J Dilger     |  |                                  | 2,850   |  |                     |  | 2,523   | 
|B J Goggin     |  |                                  | 424,676 |  |                     |  | 334,126 | 
|P M Haran      |  |                                  | 2,259   |  |                     |  | 2,000   | 
|M S Hodgkinson |  |                                  | 2,000   |  |                     |  | 2,000   | 
|J D McCourt    |  |                                  | 25,527  |  |                     |  | 5,200   | 
|G M Magan      |  |                                  | 1,750   |  |                     |  | 1,423   | 
|C A Marland    |  |                                  | 2,031   |  |                     |  | 1,705   | 
|T J Moran      |  |                                  | 2,046   |  |                     |  | 1,720   | 
|T V Neill      |  |                                  | 94,153  |  |                     |  | 83,826  | 
|D OBrien      |  |                                  | 302,078 |  |                     |  | 301,705 | 
|J ODonovan    |  |                                  | 74,351  |  |                     |  | 53,363  | 
|M P Redmond    |  |                                  | 3,204   |  |                     |  | 2,877   | 
|SECRETARY      |  |                                  |         |  |                     |  |         | 
|J B Clifford   |  |                                  | 124,541 |  |                     |  | 58,684  | 







|   |                                             
|-- | --------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US INVESTORS

Summary of Significant Differences between IFRS and U.S.
Accounting Principles




F-113



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of Significant Differences between IFRS and U.S.
Accounting Principles


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | U.S. GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(a) Revaluation of property                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | (a) Revaluation of property                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Tangible fixed assets may be held at depreciated historical cost
    or fair value. However, these revaluations must be on the basis
    of Open Market Value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | Revaluation of property is not permitted in the financial
    statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(b) Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | (b) Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Goodwill is no longer amortised. It is tested annually for
    impairment and carried at cost less accumulated impairment
    losses.
    The group has elected not to revisit goodwill on acquisitions
    prior to transition and as a result, the goodwill recognised in
    the Irish GAAP Balance Sheet at April 1, 2004 has been
    carried forward without adjustment as its deemed cost. Goodwill
    previously written off against reserves was not re-instated.                                                                                                                                                                                                                                                                                                                              |  | Prior to March 31, 2002 goodwill arising on acquisitions of
    subsidiary undertakings was capitalised and amortised to income
    over the period estimated to benefit. In the Groups case a
    period of 20 years was used. Goodwill is written off when
    judged to be irrecoverable.
    Post April 1, 2002 goodwill is capitalised on the Balance
    Sheet and is subject to an annual review for impairment. It is
    not subject to annual amortisation.
    Goodwill written off to reserves pre transition to IFRS is
    recognised on the balance sheet under US GAAP.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(c) Stock Based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |  | (c) Stock Based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|When shares are awarded, the fair value of the employee services
    received in exchange for the grant of the options or shares is
    recognised as an expense and is charged to the income statement
    over the vesting period. Save As You Earn schemes are not exempt
    from these requirements.
    The charge is determined by reference to the fair value of the
    options or shares granted, which is calculated excluding the
    impact of any non-market vesting conditions. Non-market
    conditions are reflected through the assumptions about the
    number of options or shares that are expected to vest. These
    assumptions are revisited at each balance sheet date.
    This results in a charge to the income statement for each of the
    Groups main share schemes. |  | As permitted by FAS 123, stock based compensation is
    accounted for in accordance with APB 25. Any differences
    between intrinsic value of the shares issued or options granted
    at the time the award is made and any contribution made by the
    employee is charged to the profit and loss account over the
    period to vesting.                                                                                                                                                                                                                                         

F-114



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of Significant Differences between IFRS and U.S.
Accounting Principles


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | U.S. GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(d) Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | (d) Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Under IFRS, financial instruments are classified as either(a)  Financial assets at fair value through profit
    or lossA financial asset is classified in this category if acquired
    principally for the purpose of selling in the short term or if
    so designated by management.
    Financial assets and financial liabilities may be designated at
    fair value through profit of loss (the fair value
    option) where they contain substantive embedded
    derivatives, where doing so significantly reduces measurement
    inconsistencies or where they are managed and evaluated on a
    fair value basis with a documented risk management or investment
    strategy.(b)  Loans and receivablesThis category includes non-derivative financial assets with
    fixed or determinable payments that are not quoted in an active
    market.(c)  Held-to-maturityHeld-to-maturity investments are non-derivative financial
    assets with fixed or determinable payments and fixed maturities
    that the Groups management has the positive intention and
    ability to hold to maturity.(d)  Available-for-saleAvailable-for-sale investments are those intended to be held
    for an indefinite period of time, which may be sold in response
    to needs for liquidity or changes in interest rates, exchange
    rates or equity prices. Reversal of impairments are permitted
    under IFRS.
    Financial assets are initially recognised at fair value plus
    transaction costs. Available-for-sale and financial assets at
    fair value through profit or loss are subsequently carried at
    fair value whereas loans and receivables and held-to-maturity
    investments are subsequently carried at amortised cost using the
    effective interest method. |  | Profits and losses on the sale of investments are included in
    operating income in the year in which they arise.
    Securities may be classified as (i) trading, which are
    carried at fair value with unrealised gains and losses included
    in earnings, (ii) available for sale, which are carried at
    fair value with unrealised gains and losses reported in a
    separate component of other comprehensive income or
    (iii) held to maturity, which are carried at amortised
    cost.
    US GAAP does not permit an entity to apply the fair
    value option. These instruments have to be measured in
    accordance with the appropriate US GAAP.
    Trading securities are those securities held in the short term
    to earn a profit by trading or selling such securities.
    Securities available for sale are those securities which are
    neither classified as held to maturity or trading. They are
    intended for use as part of an asset/ liability strategy, or
    that may be sold in response to changes in interest rates,
    changes in prepayment risks, the need to increase regulatory
    capital or other similar factors. Reversal of impairments are
    not permitted under US GAAP.
    Securities held to maturity are only those securities for which
    management has both the intent and ability to hold until
    maturity.
    EITF 96-15 Accounting for the Effects of Changes in
    Foreign Currency Exchange Rates on Foreign Currency Denominated
    Available for Sale Debt Securities, states that the change
    in value of debt securities attributable to foreign exchange
    fluctuations is taken directly to reserves and transferred to
    the income statement on disposal of the instrument.

F-115



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of Significant Differences between IFRS and U.S.
Accounting Principles


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  | U.S. GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|IFRS states that change in the value of debt securities
    attributable to foreign exchange fluctuations are taken to net
    income.
    A large portion of the Groups debt securities, previously
    classified as both trading and investment, have been
    reclassified as available for sale. The fair value movements
    will pass through the available for sale reserve.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(e) Employee benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  | (e) Employee benefits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|An asset or liability (net of the associated deferred taxation)
    is recognised in the balance sheet in respect of defined benefit
    pension plans. It is the present value of the defined benefit
    obligation at the balance sheet date minus the fair value of
    plan assets, together with adjustments for unrecognised past
    service cost.
    The defined benefit obligation is calculated annually by
    independent actuaries using the projected unit credit method.
    Actuarial gains and losses arising from experience adjustments
    and changes in actuarial assumptions are charged or credited
    directly to reserves through the statement of recognised income
    and expense.
    Past service costs are recognised immediately in income, unless
    the changes to the pension plan are conditional on the employees
    remaining in service for a specified period of time (the vesting
    period). In this case, the past service costs are amortised on a
    straight-line basis over the vesting period.
    As there is an overall deficit on the Groups pension
    schemes when calculated under IFRS, this has been recognised on
    the Balance Sheet on transition, net of deferred tax. |  | The same basic actuarial method is used as under IFRS, but under
    FAS87 certain assumptions differ, assets are assessed at fair
    value and liabilities are assessed at current settlement rates.
    Certain variations from regular cost are allocated in equal
    amounts over the average remaining service lives of current
    employees.
    Where the accumulated benefit obligation exceeds the fair value
    of the plan assets, an additional minimum liability equal to
    this excess is recognised. Under US GAAP, the Group elects
    to use the Corridor method, whereby actuarial gains
    and losses outside a certain range are recognised in the income
    statement, in equal amounts over the remaining service lives of
    the current employees.
    The pension related elements of voluntary leaving and voluntary
    early retirement programmes are generally expensed in the year
    in which they are awarded.
    The impact of this pronouncement has been included in the GAAP
    reconciliation in respect of the main Bank of Ireland,
    Bristol & West and New Ireland pension plans.

F-116



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of Significant Differences between IFRS and U.S.
Accounting Principles


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |  | U.S. GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(f) Life Assurance                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  | (f) Life Assurance                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|The IFRS requires line by line consolidation for all items of
    income and expenditure, assets and liabilities. Consequently,
    the group is no longer permitted to report the results and
    balances of the life assurance business as one line items.
    Instead, these amounts are broken down and allocated to lines
    which reflect their nature, whether attributable to stockholders
    or policyholders.
    In accordance with IFRS4, life assurance products are classified
    as either investment contracts, which are accounted for in
    accordance with IAS 39 or insurance contracts, which are
    accounted for under IFRS 4. The principal effects of this
    change on the accounting for investment contracts is the removal
    of that portion of the embedded value which represents the value
    of in-force business relating to those contracts, the
    recognition of an asset for deferred acquisition costs, and the
    deferral of up-front fees received for investment management
    services; deferred acquisition costs and deferred up-front fees
    are amortised over the period of the provision of investment
    management services. The accounting for insurance contracts
    under IFRS4 is unchanged.
    IFRS requires that the profit and loss account and the value of
    in-force asset in the balance sheet be grossed up based on total
    tax payable by the Group, comprising both policyholder and
    stockholder tax. |  | The present value of anticipated surplus transfers which are
    projected to arise from the long term fund in future years, and
    which are attributable to the business in force at the year end
    on a going concern basis are not recognised by the Group under
    U.S. GAAP. Unearned revenues and acquisition costs related
    to unit linked products are deferred and amortised in proportion
    to total estimated gross profits over the expected life of
    policyholders contracts. Unearned revenues are amounts
    assessed from policyholders that represent compensation
    for services to be provided in future periods. Acquisition costs
    consist of commissions and other costs which vary with and are
    primarily related to the production of revenues.
    Unrealised gains and losses on properties held to meet unit
    linked policy holder liabilities are not recognised under
    U.S. GAAP in line with SOP 03/01. Such properties are
    held at depreciated historical cost.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(g) Acceptances                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  | (g) Acceptances                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Acceptances are bills that the drawee has agreed to pay. They
    are not recognised on the balance sheet.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | Acceptances and related customer liabilities are recorded on the
    balance sheet.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

F-117



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of Significant Differences between IFRS and U.S.
Accounting Principles


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  | U.S. GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(h) Special Purpose Entities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  | (h) Special Purpose Entities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|All entities controlled by the group, as well as legally
    independent bodies (Special Purpose Entities) where the
    substance of the relationship indicates that they are controlled
    by the group, are consolidated. This results in the
    consolidation of a number of funding related special purpose
    entities on the Balance Sheet and increases the assets and
    liabilities of the group.
    In relation to securitisations, linked presentation is not
    permitted by IFRS. Consequently, the gross assets and related
    funding are separately shown on the Balance Sheet. |  | Under SFAS No.140, transfers and servicing of financial assets
    are required to be recognised using a financial components
    approach that focuses on control. Under that approach after a
    transfer of financial assets, an entity recognises the financial
    and servicing assets it controls and the liabilities it has
    incurred and derecognises financial assets when control has been
    surrendered.
    Under FIN 46-R, a controlling financial interest in a
    variable interest entity is present where an enterprise has a
    variable interest, or a combination of variable interests, that
    will absorb the majority of the entitys expected losses,
    receive a majority of the entitys expected residual
    returns, or both. The enterprise with a controlling financial
    interest is the primary beneficiary and is required to
    consolidate the variable interest entity.

F-118



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of Significant Differences between IFRS and U.S.
Accounting Principles


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  | U.S. GAAP                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(i) Derivatives                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  | (i) Derivatives                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Derivatives are initially recognised at fair value on the date
    on which a derivative contract is entered into and are
    subsequently re-measured at their fair value on the Balance
    Sheet.
    The method of recognising the resulting fair value gain or loss
    depends on whether the derivative is designated as a hedging
    instrument, and if so, the nature of the item being hedged. The
    Group designates certain derivatives as
    either: (1) hedges of the fair value of recognised
    assets or liabilities or firm commitments (fair value hedge);
    or, (2) hedges of highly probable future cash flows
    attributable to a recognised asset or liability, or a forecasted
    transaction (cash flow hedge).
    Changes in the fair value of derivatives that are designated and
    qualify as fair value hedges are recorded in the income
    statement, together with any changes in the fair value of the
    hedged asset or liability that are attributable to the hedged
    risk.
    The effective portion of changes in the fair value of
    derivatives that are designated and qualify as cash-flow hedges
    are recognised in equity. The gain or loss relating to the
    ineffective portion is recognised immediately in the income
    statement. Amounts accumulated in equity are recycled to the
    income statement in the periods in which the hedged item will
    affect profit or loss.
    Certain derivative instruments do not qualify for hedge
    accounting. Changes in their fair value are recognised
    immediately in the income statement.
    The Group has primarily applied macro cash-flow hedging to
    derivatives hedging its funding base together with the use of a
    limited number of micro fair value hedges for large ticket
    transactions. The fair value of these derivatives is now
    reflected on the balance sheet.
    As a result of the strict hedge accounting rules in IAS 39,
    hedge accounting is likely to introduce volatility into to the
    income statement to the extent that hedging relationships prove
    ineffective. |  | FAS 133 requires all derivatives to be recorded at fair
    value.
    FAS 133 states that a derivative may only be classified as
    a hedge providing an entity meets stringent qualifying criteria
    in respect of documentation and hedge effectiveness. The Group
    has chosen not to designate any of its derivatives as hedging
    instruments for US GAAP purposes. As a consequence all hedge
    accounting adjustments arising under IFRS have been reversed.

F-119



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of Significant Differences between IFRS and U.S.
Accounting Principles


|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                                                                                                                                                                                                                                                                                                          
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|IFRS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | U.S. GAAP                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |  |                                                                                                                                                                                                                                                                                                                          
|(j) Income Recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  | (j) Income Recognition                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Interest income and expense are recognised in the income
    statement using the effective interest rate. This rate includes
    all fees and points paid or received between parties to the
    contract, transaction costs and all other premiums or
    discounts.
    Fees earned on the execution of a significant act are recognised
    immediately.
    The application of IFRS has resulted in certain upfront fees and
    expenses being included in interest income and spread over the
    expected life of the underlying asset, rather than being taken
    upfront. |  | Loan origination fees net of direct loan origination costs are
    deferred and recognised as an adjustment to the yield on the
    related loan or facility.
    This adjustment comprises the majority part of the
    other classification in the income reconciliation.                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(k) Restructuring                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  | (k) Restructuring                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|A provision for restructuring costs is recognised only when the
    general recognition criteria below are met.
    (a)  an entity has a present obligation as a result of
    a past event
    (b)  it is probable that an outflow of economic
    benefits will be required to settle the obligation
    (c)  a reliable estimate can be made of the amount of
    the obligation                                                                                                                                                                                                 |  | Costs of restructuring are recognised when incurred.
    Costs of involuntary severance are recognised as incurred, save
    where the individuals in question are required to remain with
    the Group for periods in excess of their statutory notice
    period, in which case the costs are spread over this period.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(l) Debt/Equity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | (l) Debt/Equity                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|From 1, April 2005, certain subordinate instruments issued
    by the Group are treated as equity under IFRS where they contain
    no present obligation to deliver cash or another financial asset
    to the holders.                                                                                                                                                                                                                                                                                                                                                            |  | The subordinate instruments issued by the Group which are
    treated as equity under IFRS are treated as debt instruments
    under US GAAP.                                                                                                                                                                            

F-120



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)

Summary of significant differences between IFRS and U.S.
Accounting Principles


Consolidated Net Income


|                                                                  |  |  |    |                 |  |      |            |   |  |  |       |  
|----------------------------------------------------------------- |  |  | -- | --------------- |  | ---- | ---------- | - |  |  | ----- | -
|                                                                  |  |  |    |                 |  | 2005 |           
|                                                                  |  |  |    | 2006            |  |      | (Restated) |  
|                                                                  |  |  |    |                 |  |      |            |  
|                                                                  |  |  |    | (in  millions) | 
|Net income under IFRS                                             |  |  |    |                 |  |      | 1,305      |   |  |  | 1,055 |  
|Pension costs                                                     |  |  | (e | )               |  |      | (25        | ) |  |  | (4    | )
|Long-term assurance policies                                      |  |  | (f | )               |  |      | (168       | ) |  |  | (329  | )
|Strategic Transformation Programme                                |  |  | (k | )               |  |      | (41        | ) |  |  | 117   |  
|Stock based compensation                                          |  |  | (c | )               |  |      | 6          |   |  |  | 2     |  
|Derivatives                                                       |  |  |    |                 |  |      |           |   |  |  | (4    | )
|Hedging and financial instruments                                 |  |  | (d | )(i)            |  |      | (234       | ) |  |  |      |  
|Special purpose entities                                          |  |  |    |                 |  |      |           |   |  |  | (63   | )
|Foreign exchange gains/losses on available for sale securities    |  |  | (d | )               |  |      | (91        | ) |  |  | (21   | )
|Fair value option adjustment                                      |  |  | (d | )               |  |      | (44        | ) |  |  |      |  
|Dividends on other equity interests                               |  |  |    |                 |  |      | (13        | ) |  |  | (8    | )
|Other                                                             |  |  | (j | )               |  |      | 39         |   |  |  | 16    |  
|Deferred tax on U.S. GAAP adjustments                             |  |  |    |                 |  |      | 69         |   |  |  | 53    |  
|                                                                  |  |  |    |                 |  |      |            |   | 
|Net income under U.S. GAAP                                        |  |  |    |                 |  |      | 803        |   |  |  | 814   |  
|                                                                  |  |  |    |                 |  |      |            |   | 
|Earnings per unit of
    0.64 Ordinary
    Stock under U.S. GAAP |  |  |    |                 |  |      |            |   |  |  |       |  
| basic                                                           |  |  |    |                 |  |      | 84.8c      |   |  |  | 86.4c |  
|                                                                  |  |  |    |                 |  |      |            |   | 
| diluted                                                         |  |  |    |                 |  |      | 84.2c      |   |  |  | 85.7c |  
|                                                                  |  |  |    |                 |  |      |            |   | 

Consolidated Total Stockholders Funds


|                                           |  |  |    |                 |  |      |            |   |  |  |       |  
|------------------------------------------ |  |  | -- | --------------- |  | ---- | ---------- | - |  |  | ----- | -
|                                           |  |  |    |                 |  | 2005 |           
|                                           |  |  |    | 2006            |  |      | (Restated) |  
|                                           |  |  |    |                 |  |      |            |  
|                                           |  |  |    | (in  millions) | 
|Total stockholders funds under IFRS       |  |  |    |                 |  |      | 5,328      |   |  |  | 4,277 |  
|Property less related depreciation         |  |  | (a | )               |  |      | (569       | ) |  |  | (331  | )
|Goodwill                                   |  |  | (b | )               |  |      | 431        |   |  |  | 436   |  
|Debt securities  available for sale       |  |  |    |                 |  |      |           |   |  |  | 85    |  
|Pension costs                              |  |  | (e | )               |  |      | 565        |   |  |  | 737   |  
|Long-term assurance policies               |  |  | (f | )               |  |      | (604       | ) |  |  | (719  | )
|Strategic Transformation Programme         |  |  | (k | )               |  |      | 76         |   |  |  | 117   |  
|Derivatives                                |  |  |    |                 |  |      |           |   |  |  | 181   |  
|Fair value option adjustment               |  |  | (d | )               |  |      | (220       | ) |  |  |      |  
|Hedging and financial instruments          |  |  | (d | )(i)            |  |      | (101       | ) |  |  |      |  
|Debt/equity adjustment                     |  |  | (l | )               |  |      | (114       | ) |  |  |      |  
|Other                                      |  |  | (j | )               |  |      | 45         |   |  |  | (25   | )
|Deferred taxation on U.S. GAAP adjustments |  |  |    |                 |  |      | 139        |   |  |  | (28   | )
|                                           |  |  |    |                 |  |      |            |   | 
|Total stockholders funds under U.S. GAAP  |  |  |    |                 |  |      | 4,976      |   |  |  | 4,730 |  
|                                           |  |  |    |                 |  |      |            |   | 

F-121



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles




|                                                                       |  |                 |     |  
|---------------------------------------------------------------------- |  | --------------- | --- | -
|                                                                       |  | 2005            |    
|                                                                       |  |                 |    
|                                                                       |  | (in  millions) |    
|Net income in accordance with US GAAP as previously reported           |  |                 | 814 |  
|Derivatives valuation(i)                                               |  |                 | 20  |  
|Foreign exchange gains/losses on available for sale
    securities(ii) |  |                 | (21 | )
|Deferred taxation on these adjustments                                 |  |                 | 1   |  
|                                                                       |  |                 |    
|Net income in accordance with US GAAP as adjusted                      |  |                 | 814 |  
|                                                                       |  |                 |    

|                                                                          |  |                 |       |  
|------------------------------------------------------------------------- |  | --------------- | ----- | -
|                                                                          |  | 2005            |      
|                                                                          |  |                 |      
|                                                                          |  | (in  millions) |      
|Stockholders equity in accordance with US GAAP as previously
    reported |  |                 | 4,531 |  
|Derivatives valuation(i)                                                  |  |                 | 106   |  
|Deferred taxation on this adjustment                                      |  |                 | (13   | )
|Leasing tax benefit(iii)                                                  |  |                 | 106   |  
|                                                                          |  |                 |      
|Stockholders equity in accordance with US GAAP as adjusted                |  |                 | 4,730 |  
|                                                                          |  |                 |      






|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(i)   | Derivatives valuation: as part of the transition process to IFRS
    the Bank discovered that the valuation of a small portfolio of
    derivatives did not take account of a specific legal clause
    resulting in an understatement of previously reported net income
    under US GAAP for the year 31 March 2005 of
    18m
    (20m pretax) and
    stockholder funds under US GAAP as at 31 March 2005 of
    93m
    (106m pretax).                                                                                                                                                                                             
|     
|(ii)  | Under US GAAP Foreign exchange treatment of AFS Securities:
    foreign exchange differences on available for sale
    (AFS) debt securities were included in net income in
    previous years, rather than taken to reserves in accordance with
    EITF-96-15. Under IFRS the translation of foreign currency
    denominated AFS debt securities into the functional currency of
    the legal entity in which they are held is recognized directly
    in the income statement. Net income under US GAAP in the year to
    31 March 2005 has been reduced by
    18m
    (21m pretax).
    There is no change to stockholders equity.
|     
|(iii) | Leasing tax benefit: there was a one-off gain relating to
    certain lease structures arising from the falling corporation
    tax rates in Ireland in 1998, which was not recognised in that
    year under US GAAP. The effect of this restatement is to
    increase stockholders equity under US GAAP for the year to 31
    March 2005 by
    106m.                                                                                                                                                                                                                                                                                  

F-122



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)

Summary of significant differences between IFRS and U.S.
Accounting Principles


Consolidated Total Assets


|                                      |  |  |    |                 |  |      |            |   |  |  |         |  
|------------------------------------- |  |  | -- | --------------- |  | ---- | ---------- | - |  |  | ------- | -
|                                      |  |  |    |                 |  | 2005 |           
|                                      |  |  |    | 2006            |  |      | (Restated) |  
|                                      |  |  |    |                 |  |      |            |  
|                                      |  |  |    | (in  millions) | 
|Total assets under IFRS               |  |  |    |                 |  |      | 162,354    |   |  |  | 127,780 |  
|Property less related depreciation    |  |  | (a | )               |  |      | (569       | ) |  |  | (331    | )
|Goodwill                              |  |  | (b | )               |  |      | 465        |   |  |  | 455     |  
|Debt securities  available for sale  |  |  |    |                 |  |      |           |   |  |  | 85      |  
|Pension costs                         |  |  | (e | )               |  |      | 26         |   |  |  | (41     | )
|Acceptances                           |  |  | (g | )               |  |      | 37         |   |  |  | 34      |  
|Long-term assurance policies          |  |  | (f | )               |  |      | (604       | ) |  |  | (826    | )
|Special purpose entities              |  |  |    |                 |  |      |           |   |  |  | (33     | )
|Derivatives                           |  |  |    |                 |  |      |           |   |  |  | 680     |  
|Other                                 |  |  | (j | )               |  |      | 41         |   |  |  | (157    | )
|Deferred tax on U.S. GAAP adjustments |  |  |    |                 |  |      | (48        | ) |  |  | (99     | )
|                                      |  |  |    |                 |  |      |            |   | 
|Total assets under U.S. GAAP          |  |  |    |                 |  |      | 161,702    |   |  |  | 127,547 |  
|                                      |  |  |    |                 |  |      |            |   | 

Consolidated Total Liabilities and Stockholders
Funds


|                                                           |  |  |    |                 |  |      |            |   |  |  |         |  
|---------------------------------------------------------- |  |  | -- | --------------- |  | ---- | ---------- | - |  |  | ------- | -
|                                                           |  |  |    |                 |  | 2005 |           
|                                                           |  |  |    | 2006            |  |      | (Restated) |  
|                                                           |  |  |    |                 |  |      |            |  
|                                                           |  |  |    | (in  millions) | 
|Total liabilities and stockholders equity under IFRS      |  |  |    |                 |  |      | 162,354    |   |  |  | 127,780 |  
|Stockholders funds (U.S. GAAP adjustment)                 |  |  |    |                 |  |      | (352       | ) |  |  | 453     |  
|Special purpose entities                                   |  |  |    |                 |  |      |           |   |  |  | (33     | )
|Acceptances                                                |  |  | (g | )               |  |      | 37         |   |  |  | 34      |  
|Strategic Transformation Programme                         |  |  | (k | )               |  |      | (76        | ) |  |  | (117    | )
|Pension                                                    |  |  | (e | )               |  |      | (543       | ) |  |  | (783    | )
|Long term assurance policies                               |  |  | (f | )               |  |      |           |   |  |  | 21      |  
|Derivatives                                                |  |  |    |                 |  |      |           |   |  |  | 499     |  
|Fair value option adjustment                               |  |  | (d | )               |  |      | 220        |   |  |  |        |  
|Hedging and financial instruments                          |  |  | (d | )(i)            |  |      | 101        |   |  |  |        |  
|Debt/equity adjustment                                     |  |  | (l | )               |  |      | 114        |   |  |  |        |  
|Other                                                      |  |  | (j | )               |  |      | 55         |   |  |  | (92     | )
|Deferred taxation on U.S. GAAP adjustments                 |  |  |    |                 |  |      | (208       | ) |  |  | (215    | )
|                                                           |  |  |    |                 |  |      |            |   | 
|Total liabilities and stockholders equity under U.S. GAAP |  |  |    |                 |  |      | 161,702    |   |  |  | 127,547 |  
|                                                           |  |  |    |                 |  |      |            |   | 

F-123



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles


(1)  Goodwill




|                             |  |          |     |  |          |  |   |           |  |  |            |  |           |          |   |  |      |  |    |  |  |  |     | 
|---------------------------- |  | -------- | --- |  | -------- |  | - | --------- |  |  | ---------- |  | --------- | -------- | - |  | ---- |  | -- |  |  |  | --- | 
|                             |  | April 1, |     |  |          |  |   |           |  |  |            |  | March 31, |         
|                             |  | 2005     |     |  | Transfer |  |   | Additions |  |  | Impairment |  |           | Exchange |   |  | 2006 | 
|                             |  |          |     |  |          |  |   |           |  |  |            |  |           |          |   |  |      | 
|Retail Republic of Ireland   |  |          | 4   |  |          |  |   |           |  |  |            |  |           |          |   |  |      |  |    |  |  |  | 4   | 
|BOI Life                     |  |          | 94  |  |          |  |   |           |  |  |            |  |           |          |   |  |      |  |    |  |  |  | 94  | 
|Wholesale Financial Services |  |          | 66  |  |          |  |   |           |  |  |            |  |           |          |   |  |      |  |    |  |  |  | 66  | 
|UK Financial Services        |  |          | 329 |  |          |  |   |           |  |  |            |  |           |          |   |  |      |  | 11 |  |  |  | 340 | 
|Asset Management Services    |  |          | 180 |  |          |  |   |           |  |  | 145        |  |           |          |   |  |      |  | 11 |  |  |  | 336 | 
|UK Post Office               |  |          |    |  |          |  |   |           |  |  |            |  |           |          |   |  |      |  |    |  |  |  |     | 
|                             |  |          |     |  |          |  |   |           |  |  |            |  |           |          |   |  |      | 
|                             |  |          | 673 |  |          |  |  |           |  |  | 145        |  |           |          |  |  |      |  | 22 |  |  |  | 840 | 
|                             |  |          |     |  |          |  |   |           |  |  |            |  |           |          |   |  |      | 

(2)  Pensions






|                                     |  |                 |      |   |      |  |      |  
|------------------------------------ |  | --------------- | ---- | - | ---- |  | ---- | -
|                                     |  | Year Ended      |     
|                                     |  | March 31,       |     
|                                     |  |                 |     
|                                     |  | 2006            |      |   | 2005 | 
|                                     |  |                 |      |   |      | 
|                                     |  | (in  millions) |     
|Service cost                         |  |                 | 134  |   |      |  | 95   |  
|Cost of special termination benefits |  |                 | 9    |   |      |  | 1    |  
|Interest cost                        |  |                 | 189  |   |      |  | 165  |  
|Expected return on plan assets       |  |                 | (210 | ) |      |  | (178 | )
|Net amortization and deferral        |  |                 | 17   |   |      |  | 2    |  
|                                     |  |                 |      |   |      | 
|                                     |  |                 | 139  |   |      |  | 85   |  
|                                     |  |                 |      |   |      | 





| |   |                 
| | - | ----------------
| |  | Equities  60%  
|
| |  | Bonds  27.5%   
|
| |  | Property  12.5%

F-124



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles






|                  |  |                   |       |  |                   |  |       |                   |  |  |       | 
|----------------- |  | ----------------- | ----- |  | ----------------- |  | ----- | ----------------- |  |  | ----- | 
|                  |  | Target allocation |       |  | Actual allocation |  |       | Actual allocation | 
|                  |  | as at March 31,   |       |  | as at March 31,   |  |       | as at March 31,   | 
|                  |  | 2006              |       |  | 2006              |  |       | 2005              | 
|                  |  |                   |       |  |                   |  |       |                   | 
|                  |  | %                 |       |  | %                 |  |       | %                 | 
|Equity securities |  |                   | 60.0  |  |                   |  | 64.6  |                   |  |  | 61.9  | 
|Debt securities   |  |                   | 27.5  |  |                   |  | 21.1  |                   |  |  | 22.1  | 
|Property          |  |                   | 12.5  |  |                   |  | 13.8  |                   |  |  | 13.3  | 
|Other assets      |  |                   |      |  |                   |  | 0.5   |                   |  |  | 2.7   | 
|                  |  |                   |       |  |                   |  |       |                   | 
|Total             |  |                   | 100.0 |  |                   |  | 100.0 |                   |  |  | 100.0 | 
|                  |  |                   |       |  |                   |  |       |                   | 









  


F-125



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles




|                                                                                    |  |                 |     |   |      |  |     | 
|----------------------------------------------------------------------------------- |  | --------------- | --- | - | ---- |  | --- | 
|                                                                                    |  | At March 31,    |    
|                                                                                    |  |                 |    
|                                                                                    |  | 2006            |     |   | 2005 | 
|                                                                                    |  |                 |     |   |      | 
|                                                                                    |  | (in  millions) |    
|Interest in property occupied by Bank of Ireland                                    |  |                 | 150 |   |      |  | 139 | 
|Bank of Ireland
    0.64 Ordinary
    Stock                                        |  |                 | 58  |   |      |  | 55  | 
|Bank of Ireland 7.4% Guaranteed Step-up Callable Perpetual
    Preferred Securities |  |                 | Nil |   |      |  | Nil | 
|Securities Lending with Davy Stockbrokers                                           |  |                 | Nil |   |      |  | Nil | 
|Cash                                                                                |  |                 | (4  | ) |      |  | 13  | 

   


F-126



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles




|                                                                           |  |                 |       |   |      |  |       |  
|-------------------------------------------------------------------------- |  | --------------- | ----- | - | ---- |  | ----- | -
|                                                                           |  | 2006            |       |   | 2005 | 
|                                                                           |  |                 |       |   |      | 
|                                                                           |  | (in  millions) |      
|Change in projected benefit obligation                                     |  |                 |       |   |      |  |       |  
|Projected benefit obligation at April 1                                    |  |                 | 3,742 |   |      |  | 3,055 |  
|Exchange adjustments                                                       |  |                 | (4    | ) |      |  | (8    | )
|Service cost (net of members contributions)                                |  |                 | 137   |   |      |  | 95    |  
|Interest cost                                                              |  |                 | 198   |   |      |  | 165   |  
|Members contributions                                                      |  |                 | 13    |   |      |  | 10    |  
|Liability change                                                           |  |                 |      |   |      |  |      |  
|Actuarial (gain)/loss                                                      |  |                 | 241   |   |      |  | 504   |  
|Special termination benefits                                               |  |                 | 11    |   |      |  | 1     |  
|Benefits paid                                                              |  |                 | (117  | ) |      |  | (93   | )
|Other                                                                      |  |                 | 164   |   |      |  | 13    |  
|                                                                           |  |                 |       |   |      | 
|Projected benefit obligation at March 31                                   |  |                 | 4,385 |   |      |  | 3,742 |  
|                                                                           |  |                 |       |   |      | 
|Change in plan assets                                                      |  |                 |       |   |      |  |       |  
|Fair value of plan assets at April 1                                       |  |                 | 2,971 |   |      |  | 2,689 |  
|Exchange adjustments                                                       |  |                 | (2    | ) |      |  | (6    | )
|Actual return                                                              |  |                 | 586   |   |      |  | 290   |  
|Employer contribution                                                      |  |                 | 103   |   |      |  | 72    |  
|Members contribution                                                       |  |                 | 13    |   |      |  | 10    |  
|Benefits paid                                                              |  |                 | (117  | ) |      |  | (93   | )
|Other                                                                      |  |                 | 144   |   |      |  | 9     |  
|                                                                           |  |                 |       |   |      | 
|Fair value of plan assets at March 31                                      |  |                 | 3,698 |   |      |  | 2,971 |  
|                                                                           |  |                 |       |   |      | 
|Change in funded status                                                    |  |                 |       |   |      |  |       |  
|Funded status at March 31                                                  |  |                 | (687  | ) |      |  | (771  | )
|Unamortised net loss/(gain)                                                |  |                 | 531   |   |      |  | 650   |  
|Minimum Liability Obligation                                               |  |                 | (68   | ) |      |  | (66   | )
|Unamortised net asset at transition                                        |  |                 | (11   | ) |      |  | (7    | )
|                                                                           |  |                 |       |   |      | 
|(Accrued) prepaid pension cost recognised in balance sheet at
    year end |  |                 | (235  | ) |      |  | (194  | )
|                                                                           |  |                 |       |   |      | 



|    |               
|--- | --------------
|(3) | Impaired Loans



F-127



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles












(4)  Stock Compensation Plan




  




|                                 |  |                      |           |          |       |  |         |        |          |  |           |  |  |  |         | 
|-------------------------------- |  | -------------------- | --------- | -------- | ----- |  | ------- | ------ | -------- |  | --------- |  |  |  | ------- | 
|                                 |  | Year Ended March 31, |          
|                                 |  |                      |          
|                                 |  | 2006                 |           |          | 2005  | 
|                                 |  |                      |           |          |       | 
|                                 |  |                      |           | Weighted |       |  |         |        | Weighted | 
|                                 |  |                      |           | Average  |       |  |         |        | Average  | 
|                                 |  |                      |           | exercise |       |  |         |        | exercise | 
|                                 |  | Number               |           |          | price |  |         | Number |          |  | price     | 
|                                 |  |                      |           |          |       |  |         |        |          |  |           | 
|Outstanding at beginning of year |  |                      | 6,611,900 |          |       |  | 9.6809  |        |          |  | 6,585,000 |  |  |  | 8.989   | 
|Granted in year                  |  |                      | 1,267,514 |          |       |  | 12.8811 |        |          |  | 1,661,500 |  |  |  | 10.760  | 
|Exercised in year                |  |                      | 1,014,111 |          |       |  | 7.1695  |        |          |  | 853,500   |  |  |  | 5.5684  | 
|Lapsed in year                   |  |                      | 132,500   |          |       |  | 9.8688  |        |          |  | 781,100   |  |  |  | 10.6398 | 
|                                 |  |                      |           |          |       |  |         |        |          |  |           | 
|Outstanding at end of year       |  |                      | 6,732,803 |          |       |  | 10.6580 |        |          |  | 6,611,900 |  |  |  | 9.6809  | 
|                                 |  |                      |           |          |       |  |         |        |          |  |           | 

F-128



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles




|                            |  |                |           |  |                  |  |                  |                |  |  |         | 
|--------------------------- |  | -------------- | --------- |  | ---------------- |  | ---------------- | -------------- |  |  | ------- | 
|                            |  | Number         |           |  |                  |  | Number           |               
|                            |  | Outstanding at |           |  | Weighted Average |  |                  | Exercisable at | 
|                            |  | March 31,      |           |  | Remaining        |  |                  | March 31,      | 
|                            |  | 2006           |           |  | Contractual Life |  |                  | 2006           | 
|                            |  |                |           |  |                  |  |                  |                | 
|Exercise price (
    cent) |  |                |           |  |                  |  |                  |                |  |  |         | 
|2.819                       |  |                | 30,000    |  |                  |  | 3 months         |                |  |  | 30,000  | 
|4.529                       |  |                | 255,000   |  |                  |  | 1 years 3 months |                |  |  | 255,000 | 
|5.753                       |  |                | 6,000     |  |                  |  | 1 years 8 months |                |  |  | 6,000   | 
|8.264                       |  |                | 168,000   |  |                  |  | 2 years 2 months |                |  |  | 168,000 | 
|8.933                       |  |                | 250,000   |  |                  |  | 3 years 4 months |                |  |  | 250,000 | 
|8.430                       |  |                | 60,250    |  |                  |  | 3 years 8 months |                |  |  | 60,250  | 
|6.960                       |  |                | 395,934   |  |                  |  | 4 years 2 months |                |  |  | 395,934 | 
|9.150                       |  |                | 123,650   |  |                  |  | 4 years 8 months |                |  |  | 123,650 | 
|11.050                      |  |                | 448,455   |  |                  |  | 5 years 2 months |                |  |  | 448,455 | 
|10.540                      |  |                | 15,000    |  |                  |  | 5 years 8 months |                |  |  | 15,000  | 
|12.500                      |  |                | 635,000   |  |                  |  | 6 years 3 months |                |  |  | 635,000 | 
|10.650                      |  |                | 20,000    |  |                  |  | 6 years 9 months |                |  |  | 20,000  | 
|10.770                      |  |                | 1,352,000 |  |                  |  | 7 years 3 months |                |  |  |        | 
|10.540                      |  |                | 111,000   |  |                  |  | 7 years 9 months |                |  |  |        | 
|10.760                      |  |                | 1,603,000 |  |                  |  | 8 years 4 months |                |  |  |        | 
|12.850                      |  |                | 1,212,000 |  |                  |  | 9 years 3 months |                |  |  |        | 
|13.680                      |  |                | 47,514    |  |                  |  | 9 years 9 months |                |  |  |        | 

  






F-129



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles


(5)  Earnings per share






|                                                                          |  |        |     |           |               |  |     |        |           |  |        |  |  |               |     |  |        |  |     |  |  |  |       | 
|------------------------------------------------------------------------- |  | ------ | --- | --------- | ------------- |  | --- | ------ | --------- |  | ------ |  |  | ------------- | --- |  | ------ |  | --- |  |  |  | ----- | 
|                                                                          |  | 2006   |     |           | 2005          | 
|                                                                          |  |        |     |           |               | 
|                                                                          |  |        |     | Per-share |               |  |     |        | Per-share | 
|                                                                          |  | Income |     |           | Share No      |  |     | Amount |           |  | Income |  |  | Share No      |     |  | Amount | 
|                                                                          |  |        |     |           |               |  |     |        |           |  |        |  |  |               |     |  |        | 
|                                                                          |  | m     |     |           | (in millions) |  |     | Cent   |           |  | m     |  |  | (in millions) |     |  | Cent   | 
|Basic EPS                                                                 |  |        |     |           |               |  |     |        |           |  |        |  |  |               |     |  |        |  |     |  |  |  |       | 
|Approximate net income (U.S. GAAP) available to ordinary
    stockholders |  |        | 803 |           |               |  | 947 |        |           |  | 84.8   |  |  |               | 814 |  |        |  | 942 |  |  |  | 86.4c | 
|Effect of dilutive securities employee share options                      |  |        |     |           |               |  | 7   |        |           |  |        |  |  |               |     |  |        |  | 8   |  |  |  |       | 
|                                                                          |  |        |     |           |               |  |     |        |           |  |        |  |  |               |     |  |        | 
|Diluted EPS                                                               |  |        | 803 |           |               |  | 954 |        |           |  | 84.2   |  |  |               | 814 |  |        |  | 950 |  |  |  | 85.7c | 
|                                                                          |  |        |     |           |               |  |     |        |           |  |        |  |  |               |     |  |        | 



Summary of Significant Differences between Irish and U.S.
Accounting Principles




|    |           
|--- | ----------
|(6) | Guarantees



Financial Guarantees






Standby letters of credit




F-130



---



##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)



Summary of significant differences between IFRS and U.S.
Accounting Principles




Other guarantees








|    |              
|--- | -------------
|(7) | Consolidation











|   |        
|-- | -------
|A) | Conduit



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Bank of Ireland provides investment advisory services and a
    liquidity facility to a company involved in a commercial paper
    conduit program. The company purchases publicly rate marketable
    investment securities with initial minimum ratings of
    Aa3/AA by Moodys/ S&P. The company funds the
    purchase of the securities by way of an uncommitted loan from a
    Delaware incorporated company (known as a multi-seller conduit)
    which in turn issues commercial paper to investors in the US and
    European commercial paper markets. A US bank administers the
    day-to-day operations of the company and the multi-seller
    conduit. The US bank is also responsible for arranging the
    issuance of the commercial paper by the multi-seller conduit.
    The Bank does not sell its own assets to this company. As of
    August 23, 2006, the commercial paper issued by the
    multi-seller conduit is currently rated P-1/ A-1 by
    Moodys/ S&P.
|
| | As of March 31, 2006, the Group had an outstanding undrawn
    liquidity facility to the company amounting to $609.4m. Based on
    the company acquiring further high quality publicly rated
    marketable investment securities (with initial minimum ratings
    of Aa3/AA by Moodys/ S&P), the liquidity
    facility provided by the Group to the company could increase to
    a current maximum of US$1.03bn. The Groups maximum
    exposure to loss, in the highly unlikely event of
    non-performance of the entire portfolio of assets in the
    company, is represented by the contractual amount of the
    facility.                                                                                                                                                                                                                                                                                                                                                      

F-131



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                              
|-- | -------------------------------------------------------------
|48 | GROUP FINANCIAL INFORMATION FOR US
    INVESTORS  (continued)

Summary of significant differences between IFRS and U.S.
Accounting Principles




|   |          
|-- | ---------
|B) | Partholon



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Group has sold a pool of leveraged acquisition finance loan
    assets to Partholon CDO 1 plc (Partholon), which is
    incorporated under the Irish Companies Acts, 1963 to 2003 and is
    registered and operates in the Republic of Ireland. Partholon
    has issued a series of loan notes to finance this purchase. The
    Group hols 25% of the subordinated loan notes but does not own,
    directly or indirectly, any of the share capital of Partholon,
    which is owned by a charitable trust. The Group also holds
    5m of AAA-rated
    loan notes in Partholon, which it intends to hold until maturity.
|
| | Under the terms of separate agreements the Group manages the
    assets of Partholon, including identification of additional
    assets for acquisition, for which it receives fees.                                                                                                                                                                                                                                                                                                                                                                                                                                                 



|    |             
|--- | ------------
|(8) | Deferred tax



|                                                     |  |      |      |   |      |  |      |  
|---------------------------------------------------- |  | ---- | ---- | - | ---- |  | ---- | -
|                                                     |  | 2006 |      |   | 2005 | 
|                                                     |  | m   |      |   | m   | 
|                                                     |  |      |      |   |      | 
|Deferred tax liabilities:                            |  |      |      |   |      |  |      |  
|Deferred tax liabilities under IFRS (see Note 31)    |  |      | 327  |   |      |  | 282  |  
|In respect of IFRS/US GAAP reconciling items         |  |      | (208 | ) |      |  | (215 | )
|                                                     |  |      |      |   |      | 
|Total deferred tax liabilities                       |  |      | 119  |   |      |  | 67   |  
|                                                     |  |      |      |   |      | 
|Deferred tax assets:                                 |  |      |      |   |      |  |      |  
|Deferred tax assets under IFRS (see Note 31)         |  |      | 150  |   |      |  | 169  |  
|Add: valuation allowance                             |  |      | 1    |   |      |  | 5    |  
|In respect of IFRS/US GAAP reconciling items         |  |      | (48  | ) |      |  | (99  | )
|                                                     |  |      |      |   |      | 
|Total deferred tax assets before valuation allowance |  |      | 103  |   |      |  | 75   |  
|Less: valuation allowance                            |  |      | (1   | ) |      |  | (5   | )
|                                                     |  |      |      |   |      | 
|Deferred tax assets less valuation allowance         |  |      | 102  |   |      |  | 70   |  
|                                                     |  |      |      |   |      | 





F-132



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                                    
|-- | -----------------------------------------------------------------------------------
|49 | SFAS NO. 115 ACCOUNTING FOR CERTAIN INVESTMENTS IN
    DEBT AND EQUITY SECURITIES





|                                                    |  |                 |        |  |       |  |        |        |  |  |        | 
|--------------------------------------------------- |  | --------------- | ------ |  | ----- |  | ------ | ------ |  |  | ------ | 
|                                                    |  | At March 31,    |       
|                                                    |  |                 |       
|                                                    |  | 2006            |        |  | 2005  | 
|                                                    |  |                 |        |  |       | 
|                                                    |  | Book /          |        |  |      
|                                                    |  | Market          |        |  | Book  |  |        | Market | 
|                                                    |  | Value           |        |  | Value |  |        | Value  | 
|                                                    |  | IFRS            |        |  | IFRS  |  |        | IFRS   | 
|                                                    |  |                 |        |  |       |  |        |        | 
|                                                    |  | (in  millions) |       
|Held to maturity                                    |  |                 |       |  |       |  | 3,704  |        |  |  | 3,701  | 
|Available for sale                                  |  |                 | 28,225 |  |       |  | 13,040 |        |  |  | 13,139 | 
|Trading                                             |  |                 | 956    |  |       |  | 5,967  |        |  |  | 5,967  | 
|Financial instruments at fair value through the P&L |  |                 | 10,224 |  |       |  |       |        |  |  |       | 
|                                                    |  |                 |        |  |       |  |        |        | 
|Total                                               |  |                 | 39,405 |  |       |  | 22,711 |        |  |  | 22,807 | 
|                                                    |  |                 |        |  |       |  |        |        | 



|                                           |  |                                         |        |  |       |  |        |        |  |  |        | 
|------------------------------------------ |  | --------------------------------------- | ------ |  | ----- |  | ------ | ------ |  |  | ------ | 
|                                           |  | Available for Sale Investment Portfolio |       
|                                           |  | At March 31,                            |       
|                                           |  |                                         |       
|                                           |  | 2006                                    |        |  | 2005  | 
|                                           |  |                                         |        |  |       | 
|                                           |  | Book /                                  |        |  |      
|                                           |  | Market                                  |        |  | Book  |  |        | Market | 
|                                           |  | Value                                   |        |  | value |  |        | Value  | 
|                                           |  | IFRS                                    |        |  | IFRS  |  |        | IFRS   | 
|                                           |  |                                         |        |  |       |  |        |        | 
|                                           |  | (in  millions)                         |       
|Irish government                           |  |                                         | 2,399  |  |       |  | 297    |        |  |  | 297    | 
|Other European government                  |  |                                         | 2,942  |  |       |  | 394    |        |  |  | 407    | 
|U.S. Treasury and U.S. Government agencies |  |                                         | 520    |  |       |  |       |        |  |  |       | 
|Collateralised Mortgage Obligations        |  |                                         | 2,659  |  |       |  |       |        |  |  |       | 
|Corporate bonds                            |  |                                         | 13,233 |  |       |  | 11,515 |        |  |  | 11,598 | 
|Other securities                           |  |                                         | 6,472  |  |       |  | 834    |        |  |  | 837    | 
|                                           |  |                                         |        |  |       |  |        |        | 
|Total                                      |  |                                         | 28,225 |  |       |  | 13,040 |        |  |  | 13,139 | 
|                                           |  |                                         |        |  |       |  |        |        | 

     




F-133



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##### Table of Contents



BANK OF IRELAND GROUP


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                                                                                 
|-- | ------------------------------------------------------------------------------------------------
|49 | SFAS NO. 115 ACCOUNTING FOR CERTAIN INVESTMENTS IN
    DEBT AND EQUITY SECURITIES  (continued)



|                                           |  |                                         |       |           |            |  |            |          |  |  |          |  |  |       |     |  |  |  |        | 
|------------------------------------------ |  | --------------------------------------- | ----- | --------- | ---------- |  | ---------- | -------- |  |  | -------- |  |  | ----- | --- |  |  |  | ------ | 
|                                           |  | Maturity Distribution of                |      
|                                           |  | Available For Sale Investment Portfolio |      
|                                           |  | At March 31, 2006                       |      
|                                           |  | IFRS                                    |      
|                                           |  |                                         |      
|                                           |  |                                         |       | After One |            |  | After Five |          |  | 
|                                           |  | In One                                  |       |           | Year       |  |            | Years    |  |  |         
|                                           |  | Year or                                 |       |           | Through    |  |            | Through  |  |  | After 10 |  |  |      
|                                           |  | Less                                    |       |           | Five Years |  |            | 10 Years |  |  | Years    |  |  | Total |    
|                                           |  |                                         |       |           |            |  |            |          |  |  |          |  |  |       |    
|                                           |  | (in  millions)                         |      
|Irish government                           |  |                                         |      |           |            |  | 2,071      |          |  |  | 328      |  |  |       |    |  |  |  | 2,399  | 
|Other European government                  |  |                                         | 364   |           |            |  | 939        |          |  |  | 1,639    |  |  |       |    |  |  |  | 2,942  | 
|U.S. Treasury and U.S. Government agencies |  |                                         |      |           |            |  | 495        |          |  |  | 25       |  |  |       |    |  |  |  | 520    | 
|Collateralised Mortgage Obligations        |  |                                         | 162   |           |            |  | 921        |          |  |  | 1,365    |  |  |       | 211 |  |  |  | 2,659  | 
|Corporate bonds                            |  |                                         | 2,836 |           |            |  | 8,533      |          |  |  | 1,834    |  |  |       | 30  |  |  |  | 13,233 | 
|Other securities                           |  |                                         | 4,800 |           |            |  | 962        |          |  |  | 515      |  |  |       | 195 |  |  |  | 6,472  | 
|                                           |  |                                         |       |           |            |  |            |          |  |  |          |  |  |       |    
|Total                                      |  |                                         | 8,162 |           |            |  | 13,921     |          |  |  | 5,706    |  |  |       | 436 |  |  |  | 28,225 | 
|                                           |  |                                         |       |           |            |  |            |          |  |  |          |  |  |       |    



|                                           |  |                                       |   |  |       |  |       |        |  |  |       | 
|------------------------------------------ |  | ------------------------------------- | - |  | ----- |  | ----- | ------ |  |  | ----- | 
|                                           |  | Held to Maturity Investment Portfolio |  
|                                           |  | At March 31,                          |  
|                                           |  |                                       |  
|                                           |  | 2006                                  |   |  | 2005  | 
|                                           |  |                                       |   |  |       | 
|                                           |  | Book /                                |   |  |      
|                                           |  | Market                                |   |  | Book  |  |       | Market | 
|                                           |  | Value                                 |   |  | value |  |       | Value  | 
|                                           |  | IFRS                                  |   |  | IFRS  |  |       | IFRS   | 
|                                           |  |                                       |   |  |       |  |       |        | 
|                                           |  | (in  millions)                       |  
|Irish government                           |  |                                       |  |  |       |  |      |        |  |  |      | 
|Other European government                  |  |                                       |  |  |       |  |      |        |  |  |      | 
|U.S. treasury and U.S. government agencies |  |                                       |  |  |       |  |      |        |  |  |      | 
|Corporate bonds                            |  |                                       |  |  |       |  | 3,184 |        |  |  | 3,181 | 
|Other securities                           |  |                                       |  |  |       |  | 520   |        |  |  | 520   | 
|                                           |  |                                       |   |  |       |  |       |        | 
|                                           |  |                                       |  |  |       |  | 3,704 |        |  |  | 3,701 | 
|                                           |  |                                       |   |  |       |  |       |        | 

     


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##### Table of Contents



BANK OF IRELAND GROUP


SIGNATURES


20-F




| |                                                
| | -----------------------------------------------
| | The Governor and Company of the Bank of Ireland
| | (Registrant)                                   
|
| | Date: September 11, 2006                       



| |     |                     
| | --- | --------------------
| | By: | /s/ Brian
    Goggin

| |                              
| | -----------------------------
| |                              
| | Name: Brian Goggin           
| | Title:  Group Chief Executive



| |     |                       
| | --- | ----------------------
| | By: | /s/ John
    ODonovan

| |                                      
| | -------------------------------------
| |                                      
| | Name: John ODonovan                 
| | Title:  Group Chief Financial Officer

F-135