Long-Term IDR*
AAA
Outlook Stable


* IDR Issuer Default Rating


Financial Data
Anglo Irish Bank Corporation PLC

31 Mar 07 30 Sep 06
Total Assets (USDm)
118,090
92,784
Total Assets (EURm)
88,669
73,290
Equity (EURm)
3,629
2,687
Operating Profit
(EURm)
552 850
Published Net
Income (EURm)
464
658
Comprehensive
Income (EURm)
438 604
Operating ROAA (%)
1.36
1.38
Operating ROAE (%)
34.96
38.32
Internal Capital
Generation (%)
26.32
23.89
Eligible Capital/
Weighted Risks (%)
7.40 6.43
Tier 1 Ratio (%)
8.50
8.40


Analysts
Robert Thursfield, London
+44 20 7417 3548
robert.thursfield
@fitchratings.com


Matthew Taylor, London
+44 20 7417 4245
matthew.taylor@fitchratings.com


Alison Leveridge, London
+44 20 7417 4305
alison.leveridge@fitchratings.com

Rating Rationale
Anglo Irish Bank Corporation PLCs (Anglo) Long and Short-term
IDRs and Individual ratings reflect consistently strong profitability, good
asset quality, an extremely low cost/income ratio, diversified funding and
stable margins. Ratings also reflect capitalisation that has a fairly high
proportion of preference shares and hybrids.
The bank continues to grow rapidly by specialising in
secured term
lending to professionals and medium-sized corporates in Ireland, the
UK and the US to purchase investment properties in the retail, office
and leisure sectors.
Anglo usually takes real estate as collateral for its
loans and also personal guarantees.
Recent financial performance has been strong with the bank continuing
to benefit from favourable economic environments in its three main
markets.
Net income for the first half of 2007 (H107) was very
good at EUR464m, however Anglo has cautioned that growth rates in
H107 may not be repeated in H207 as the current fast pace of
economic growth in Ireland slows slightly

The cost/income ratio was an extremely low 25% in H107, benefiting
from a limited range of products and a small distribution network.
Asset quality remains good with impaired loans of 0.5% of loans at end-
H107 with total impaired loan allowance coverage of 97% (individual
allowances cover 46%). There is some concentration by borrower, but
this continues to decrease as the portfolio grows strongly in a number of
sectors and geographies.
Funding is well diversified by type and geography between
retail/commercial deposits and capital market issuance (medium term
notes, commercial paper programmes and covered bonds).
Market risks remain limited and well managed, although treasury income
continues to grow quickly.
Anglos regulatory capital ratios look sound with Tier 1 and total capital
ratios of 8.5% and 11.4% at end-1H07 (2006: 8.4% & 12.1%). However,
a fairly high proportion of hybrid Tier 1 capital reduces its quality and
gives a Fitch eligible capital ratio of 7.4% at end-H107 (2006: 6.4%).
Support
Anglo has a significant number of institutional shareholders, none of
which has a stake above 5%. Although the Central Bank of Ireland has
no legal obligation to come to the rescue of banks in Ireland, in Fitchs
opinion there is a moderate probability of support from the authorities.

Rating Outlook and Key Rating Drivers
Anglos ratings have a Stable Outlook, and, given its consistent
performance and continued benign economic environments in Ireland
and the UK, this is likely to remain the case over the medium term.
The bank is unlikely to see any increases in ratings in the medium term,
while downside risk to ratings would arise from a significant decline in
core capital ratios and/or a significant deterioration in the banks key
operating markets leading to asset quality problems.

Profile
Anglo is the fourth largest Irish-controlled private sector bank in the
Republic of Ireland. It provides specialised services to high net worth
individuals, professionals and medium-sized corporates in Ireland, the
UK and the US, a significant amount of which is secured on real estate.
Anglo has six Irish and seven UK branches, three US representative
offices (Boston, Chicago and New York) and a presence in Austria,
Germany, Isle of Man, Portugal and Switzerland.
Ireland
Credit Analysis
Anglo Irish Bank Corporation PLC Banks
Anglo Irish Bank Corporation PLC: August 2007
2

Profile


Focus on secured lending to fund the
purchase of investment properties Growing wealth management business Operations focused on Irish, UK and US
markets
Anglo was incorporated in 1964 and became a public
limited company in 1971. The bank streamlined its
operations in 1993, moving out of peripheral
business such as stock and insurance brokerage to
concentrate on its core banking and treasury
operations. Anglo does not aim to be a full service
provider of financial services its core business is
the provision of specialised services to high net
worth individuals, professionals and medium sized
corporates in Ireland, the UK and the US. However,
as the bank has sought to diversify its revenue
streams and to reduce its dependence upon interest
and interest related income, it has sought opportunist
acquisitions. These have primarily helped the bank
to expand its wealth management activities. Anglo is
quoted in Dublin and London and has a broad
shareholder base of over 18,000 shareholders.
Institutional investors hold almost 90% of its shares.
Banking Division: Anglo primarily focuses on
secured term lending to professionals and medium-
sized corporates in Ireland, the UK and the US to
purchase investment properties in the retail, office
and leisure sectors. The bank believes it has an
approximate 20% market share in mid-sized
commercial lending in Ireland, ranking third after
Allied Irish Banks and Bank of Ireland. Anglos
share of the UK investment property market is
estimated by the bank to be approximately 5%, with
a focus on London and the South East. The banks
branch network is limited to six locations in Ireland
and seven in the UK, as well as representative
offices in Boston, Chicago and New York.
Treasury: Primarily responsible for the banks
funding and liquidity management, but also active in
corporate treasury sales. The banks modest trading
activities, which are primarily customer-oriented, are
confined to its dealing room in Dublin. Corporate
treasury services are carried out in Ireland, the UK,
Austria, and in its representative offices in the US.
Wealth Management: The division includes private
banking, fund management and retirement planning
services and has grown both organically and through
a number of acquisitions in the last 5-10 years.
Wealth management services are provided through
Anglos operations in Ireland, the UK, Austria,
Portugal (opened in 2006) and Switzerland. Total
assets under management at end-H107 were
EUR4.6bn. The banks trust operations in the Isle of
Man were sold in December 2006 for a profit on
disposal of EUR22m.
Strategy: Anglos strategic focus for the period
2007-11 remains the same as the one it has been
pursuing in recent years. The bank will continue to
focus on organic growth in its three main markets
with a focus on growing market share in the UK
(spreading out into the regions) and US (around the
existing three offices). The market share of about
20% in Ireland will be harder to grow. The bank
doesnt see acquisitions as being a major part of
future growth, although selective opportunities may
be considered, most likely within wealth
management. Lending will continue to be mostly
property investment related with a high percentage
of repeat business. Anglo will continue to follow its
clients into Europe, although this is not likely to
exceed 5% of the total loan portfolio.
Accounting Standards: Anglo reported under IFRS
for the first time for the six months to end-March
2006. Results for the year to end-September 2005
were restated to reflect IFRS with the exception of
IAS32 and IAS39, which were introduced to Anglos
accounts from 1
st
October 2005. The majority of the
analysis in this report is based on the six months to
end-March 2007 and the year to end-September 2006,
both of which are fully IFRS compliant.


Performance
Strong profitability supported by rapid
loan growth Consistent net interest margin Good cost efficiency
The bank continues to perform well, benefiting from
a domestic economy that is still growing faster than
the rest of the Euro-zone and good conditions in the
UK and US. Loan growth of 18% since end-
September 2006 across the banks three main
markets drove growth in yoy pre-tax profits of 47%
to EUR552m in H107 (excluding the EUR22m gain
on the sale). The bank has cautioned that such levels
of growth may not be repeated in the second half of
the year as economic growth slows down in the
banks main market of Ireland. Anglo should
continue growing market share in the UK and US.
Although banking remains the main driver of
revenues and assets, wealth management and
treasurys contributions continue to show solid
improvements.

Revenues: Net interest income continues to grow
strongly as rapid loan growth persists. In H107 the
bank reported EUR723m of net interest revenues
(2006: EUR1.07bn), representing 89% of total
operating revenues (2006: 86%). The growth in Banks
Anglo Irish Bank Corporation PLC: August 2007
3
interest revenues ha