Bank of Ireland Annual General Court July 5, 2000.

Business Editors

DUBLIN--(BUSINESS WIRE)--July 5, 2000

Bank of Ireland Group (NYSE: IRE), a leading Irish financial services group, today announced that the following issues were referred to by the Governor, Howard Kilroy, in his address to the Annual General Court.

-- The year has got off to a very good start across the Group,

generating confidence in the outcome for the full year.

-- The report of the Comptroller and Auditor General and the

subsequent Public Accounts Committee Hearing which drew

attention to the failure of the financial institutions to

comply with the provisions of the Finance Act, 1986 relating

to Deposit Interest Retention Tax ("DIRT"). He had stated in

the Report and Accounts that the Group was anxious to bring

this matter to an early conclusion and was co-operating fully

with the Revenue to achieve that end. "I am now able to inform

you that Bank of Ireland has agreed with the Revenue,

following their very detailed audit covering all relevant

parts of the Group for the period 1986 to 1999, to make a full

and final settlement involving the payment of additional DIRT

of(pound)12.75 million in respect of that period. The Group's

total DIRT remittances from 1986 to 1999 amount to

some(pound)630 million. Interest and penalties applied by the

Revenue Commissioners amount to (pound)17.75 million. This was

a regrettable episode in an otherwise compliant organization

and we are determined that such circumstances will not arise

again. This settlement, which in total amounts to(pound)30.5

million, brings this matter to a close and payment has been

made".

-- The Bank's domestic franchise continues to demonstrate the

strength of the brand and the quality of customer offerings

across all segments. Continued strong growth is expected in

Ireland.

-- Focus in the UK is on exploiting the Group's growing

franchises in business banking and Bristol & West. There are

particular opportunities in the small and medium business

sector. Bristol & West is being built into a significant

player in selected profitable market segments including

personal savings, specialist mortgage products and independent

advisory activities. The UK operations continue to perform

well in a very competitive market.

-- The Group expects to deliver further international growth

through Bank of Ireland Asset Management, the Group's IFSC

operations and joint ventures, of which Nova is an example.

Further such opportunities, both organic and acquisition, will

be examined.

-- An essential part of Bank of Ireland's development is its

approach to eBusiness. The Group has already developed a range

of leading capabilities and is evolving very rapidly into an

eBusiness bank. It is determined to be the leading innovator

in its domestic market. Outside Ireland, eBusiness presents

significant opportunities to exploit niche markets, both alone

and through key partnerships.

-- The Group's asset quality remains very good reflecting our

prudent and effective credit procedures.

-- The Group's potential for future growth is coupled with a

vigorous commitment to be a leader in delivering cost

efficiency across the Group. Steady progress on the Group

Transformation Program gives confidence that the target of a

cost income ratio of below 50% by 2002/2003 is on track for

delivery. The achievement of this level of cost efficiency

will underpin the Group's ability to continue to deliver ROE

in excess of 20% in the medium term.

Update on Trading (Unaudited)

Retail Banking Republic

Overall, volumes continue to grow significantly while asset quality remains excellent. Arrears levels have improved slightly and remain in absolute terms very low. Margins have held relatively steady from the second half of 1999/2000.

Life Assurance

The year has started well with Annual Premium Equivalent sales to May 2000 up 28% on last year.

Corporate and Treasury

Corporate and Treasury has performed well in the first two months and is well ahead of last year.

Asset Management

BIAM continues to perform very well with strong new business inflows.

Bristol & West

Despite pressure on margins and the pricing policy of a number of major players, Bristol & West has continued to achieve growth in residential lending assets, while maintaining satisfactory levels of return in a very competitive market. Savings balances have also grown significantly. Bristol & West's first Internet only account, Save.it, has been successfully launched and has attracted significant amounts of new money.

Group Asset Quality

Since the year end, the grade profile of the loan book has improved slightly and remains at a very satisfactory level. Arrears remain stable in aggregate and the Group continues to expect that the loan loss charge for the year will be satisfactory, in the range of 15-20 basis points.

BOIe

On May 11, Bank of Ireland announced the formation of BOIe, a specialist operating unit focusing on eBusiness opportunities. The new unit will build on the Bank's successful existing internet offerings which include Banking 365 Online, a comprehensive consumer internet banking offer, Business On Line, Bank of Ireland's leading edge Business Banking capability, Fsharp, the world's first offshore internet bank, and Clikpay, the Bank's secure internet card payment capability, as well as the Bank's highly functional Group Website. BOIe was established to develop and deliver differentiated eBusiness propositions, targeted at both consumers and businesses. Within its first month of operations, it has announced plans for WAP enablement of the consumer internet bank, online share dealing, a secure virtual credit card, and a distribution agreement with Unison / Independent Newspapers.

Group Transformation Program

Continued progress is being made in the Group's cost reduction program. The amalgamations of Treasury with International Banking and Northern Ireland with Banking Great Britain are progressing well and new more streamlined management structures have been implemented since year-end. In Retail Banking Republic, a new management structure has recently been announced which significantly enhances management efficiency. Progress is also being made in the ongoing review of the branch network in the Republic.

The Group Transformation Program will necessarily require incurring severance costs and the Group anticipates that provision for these costs will be made in the current year. The program will also require capital investments, primarily in Information Technology, which will be ongoing.

Interim Results for Bank of Ireland will be announced on Thursday November 16, 2000.

Business Drivers of Income (Unaudited)

                                    March '99         May '99
Volumes                             March '00         May '00
                                     % Change         % Change

Retail Banking Republic
Total Lending                           24               26
Residential Mortgages                   28               27
Other Lending                           23               25

Total Resources                         11               11
Credit Balances                         32               29
Deposits                                 5                6

Corporate & Treasury
Lending                                 37               30
Resources                               33               25

Bristol & West
Lending                                  6                6
Resources                                2               11

Assets under Management                 39               36
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In addition to its US listing (NYSE: IRE), Bank of Ireland ordinary shares trade on the Irish Stock Exchange and the London Stock Exchange and prices may be accessed on Bloomberg under the symbol BKIR ID, on the Reuters Equities 2000 Service under BKIR.I, and on Quotron under the symbol BKIRU.EU. Additional information is available on Bank of Ireland's home page: http://www.bankofireland.ie