Form 20-F Allied Irish Banks
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Form 20-F (Mark One) REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ANNUAL REPORT PURSUANT TO SECTION 13 OR l5(d) OF x THE SECURITIES EXCHANGE ACT OF 1934 For the year ended December 31, 2004 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR l5(d) OF THE SECURITIES EXkCHANGE ACT OF 1934 Commission file number 1-10284 Allied Irish Banks, public limited company (Exact name of registrant as specified in its charter) Ireland (Jurisdiction of incorporation or organization) Bankcentre, Ballsbridge, Dublin 4, Ireland (Address of principal executive offices) Securities registered or to be registered pursuant to Section 12(b) of the Act Name of each exchange Title of each class on which registered Ordinary shares of EUR 0.32 each, represented by American Depositary Shares New York Stock Exchange Securities registered or to be registered pursuant to Section 12(g) of the Act. None Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act. None Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report. Non-cumulative preference shares of US$25 each 250,000 Ordinary shares of EUR 0.32 each 918,435,570 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Ye s X N o Indicate by check mark which financial statement item the registrant has elected to follow. Item 17 Item 18 X ALLIED IRISH BANKS, p.l.c. ANNUAL REPORT ON FORM 20-F FOR THE YEAR ENDED DECEMBER 31, 2004 TABLE OF CONTENTS Page Item Item Caption Number REPORTING CURRENCY AND EXCHANGE RATES, FORWARD-LOOKING INFORMATION...................................................................................................... 1 Part I 1 IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS (Not applicable) 2 OFFER STATISTICS AND EXPECTED TIMETABLE (Not applicable) 3 KEY INFORMATION Selected financial data.................................................................................................. 2 Risk factors................................................................................................................. 5 4 INFORMATION ON THE COMPANY History and development of the company..................................................................... 6 Business overview........................................................................................................ 8 Description of property................................................................................................ 19 Organizational structure............................................................................................... 20 5 OPERATING AND FINANCIAL REVIEW AND PROSPECTS Critical accounting policies........................................................................................... 21 Operating results.......................................................................................................... 22 Liquidity and capital resources..................................................................................... 41 Trend information....................................................................................................... 45 6 DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES Directors and senior management................................................................................. 46 Compensation............................................................................................................. 47 Board practices............................................................................................................ 50 Share ownership.......................................................................................................... 50 Corporate governance.................................................................................................. 54 Employees................................................................................................................... 59 7 MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS Major shareholders...................................................................................................... 60 Related party transactions........................................................................................... 60 8 FINANCIAL INFORMATION Consolidated statements and other financial information............................................... 61 Significant changes...................................................................................................... 61 9 THE OFFER AND LISTING Offer and listing details................................................................................................ 71 Markets....................................................................................................................... 71 10 ADDITIONAL INFORMATION Memorandum and articles of association....................................................................... 72 Exchange controls....................................................................................................... 72 Taxation...................................................................................................................... 72 11 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT RISK Risk management........................................................................................................ 75 Loan portfolio.............................................................................................................. 83 12 DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES (Not applicable) Part II 13 DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES................................ 96 14 MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS.............................................................................................. 96 15 CONTROLS AND PROCEDURES................................................................................ 96 16A AUDIT COMMITTEE FINANCIAL EXPERT............................................................... 96 16B CODE OF ETHICS............................................................................................................ 96 16C PRINCIPAL ACCOUNTANT FEES AND SERVICES...................................................... 96 Part III 17 FINANCIAL STATEMENTS.............................................................................................. 97 18 & 19 FINANCIAL STATEMENTS AND EXHIBITS................................................................ 97 SIGNATURES................................................................................................................... 190 (THIS PAGE INTENTIONALLY LEFT BLANK) REPORTING CURRENCY AND EXCHANGE RATES Allied Irish Banks, p.l.c. (“AIB” or the “Company”) and its subsidiaries (collectively “AIB Group” or “Group”) publish consolidated financial statements in euro (€).The euro was introduced on January 1, 1999. Ireland joined the European Single Currency at the fixed translation rate of EUR 1=IR£0.787564. Each euro is made up of one hundred cent, denoted by the symbol “c” in these accounts. In this Annual Report, references to “US dollars”,“dollars”,“US$”,“cents” or “¢” are to United States currency, references to “EUR”,“euro”,“€” or “c” are to euro currency, references to “sterling” or “Stg£” are to British currency, references to “zloty”, “PLN” or “zl” are to Polish currency and references to “Yen”are to Japanese currency. Merely for convenience, this Annual Report contains translation of certain euro amounts into dollars at specified rates.These translations should not be construed as representations that the euro amounts actually represent such dollar amounts or could be converted into dollars at the rate indicated or at any other rate. Unless otherwise indicated, the translations of euro into dollars have been made at €1.00 to US$1.2912 the noon buying rate in the City of New York for cable transfers in euros as certified for customs purposes by the Federal Reserve Bank of New York (“the noon buying rate”) on April 8, 2005. The following table shows, for the periods and dates indicated, certain information regarding the noon buying rate, expressed in US dollars per euro. Period Average end(1) rate(2) High Low Year ended Dec. 31, 2000................ 0.9257 0.9184 1.0335 0.8271 Year ended Dec. 31, 2001................ 0.8822 0.8919 0.9535 0.8370 Year ended Dec. 31, 2002................ 1.0485 0.9495 1.0485 0.8594 Year ended Dec. 31, 2003................ 1.2597 1.1411 1.2597 1.0361 Year ended Dec. 31, 2004................ 1.3538 1.2487 1.3625 1.1801 (1) The noon buying rate at such dates differed from the rates used in the preparation of AIB Group’s consolidated financial statements, which were US$ 0.9305, US$ 0.8813,US$ 1.0487, US$ 1.2630 and US$ 1.3621 to €1.00 at December 31, 2000, 2001, 2002, 2003 and 2004 respectively. (2) The average rate for each period is the average of the noon buying rates on the last day of each month during that period. On April 29, 2005 the noon buying rate was EUR1.00 = US$ 1.2919 The accounting policy in respect of the translation of profits and losses arising in foreign locations is set out on page 102.A significant proportion of the Group’s earnings