1

A number of statements we will be making in our presentation and in the accompanying slides will not be based on historical fact, but will be “forward-looking” statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected in the forward looking statements. Factors that could cause actual results to differ materially from those in the forward looking statements include, but are not limited to, global, national and regional economic conditions, levels of market interest rates, credit or other risks of lending and investment activities, competitive and regulatory factors and technology change. Any ‘forward-looking statements made by or on behalf of the Group speak only as of the date they are made.

Allied Irish Banks plc

Capital & Funding

May 2006

2

Allied Irish Banks, p.l.c.

Ireland’s largest publicly quoted company

Retail & commercial bank with strong franchises in all geographies

# 1 bank in Ireland with leading market shares in core banking products

By market capitalisation €16bn (May 2006) 15.7% of Irish Stock Market Index 14th/47 DJ E Stoxx Bank Index

26th/53 FTSE Eurotop Bank Index

2005 - total assets € 133bn, PBT € 1.7bn

Senior debt ratings Moody’s ‘Aa3’ (stable outlook)S&P ‘A+’ (stable outlook)Fitch IBCA ‘AA-’ (stable outlook)

3

Executive Structure

Group Executive CommitteeGroup Chief Executive

Eugene Sheehy x

AIB Bank (RoI)Managing Director

Donal Forde

AIB Group (UK) p.l.c.Managing Director

Robbie Henneberry x

AIB Capital MarketsManaging Director

Colm Doherty

AIB Poland Division Managing Director

Gerry Byrne

Head of Group Strategic

Human ResourcesMary Toomey x

Group Chief Risk Officer

Shom Bhattacharya

Group Financial Director

John O’Donnell x

Director of Operations

Steve Meadows x

Global Treasury Managing Director

Nick Treble

Liquidity & Funding Gerry O’Connor

Chief Dealer –Funding

Duncan Farquhar

Head of A/C & Finance Maeliosa

O’Hogartaigh x

Group Finance General Manager

Alan Kelly x

Group InvestorRelations Manager

Maurice Tracey

‘x’ new appointments

4

Performance Highlights - Continued Positive Momentum

Basic earnings per share 151.0 c

- adjusted basic * 145.9 c 15%

* Excludes (i) profit on new bankcentre development and (ii) hedge volatility under IFRS

Positive income / cost gap 5%

Cost / income ratio 2.5%

Impaired loans 1%

Dividend 10%

Return on equity 20.6%

Tier 1 capital ratio 7.2%

5

Buoyant Customer Demand Driving Income

12%

16%

27%

6%

15%

Loans Deposits . Net InterestIncome

Other income TotalOperating

IncomeNet Interest

Margin-20 bps

Organic growth - best use of capital

- solid capital and funding positions

6

Divisional profile - Dec 2005

PBT 8%RWA’s 5%5yr Av.GDP 3.0%

Investment in 23.5% of M&T BankContribution to PBT 9%5yr Av.GDP 2.6%

PBT 17%RWA’s 18%5yr Av.GDP 2.3%

PBT 44%RWA’s 39%5yr Av.GDP 5.1%

AIB Bank, ROI Division UK Division

M&T Bank Poland Division

Capital Markets Division

PBT 22%RWA’s 38%

7

Divisional Performance

AIB Bank Republic of Ireland €779m 24%

AIB GB & NI €322m 18%

Capital Markets €403m 27%

Poland €132m 13%

M&T €148m * 16%

* after tax figure

Profit before tax

8

Underlying profit 15% (pre 2004 investigation charge)

Cost / income ratio 51.3% (52.7% in 2004)

Reinforcing our no. 1 position in Irish banking

AIB Bank Republic of Ireland 24%

Year on year growth

25%24%

31%28%

20%

Deposits Total Loans BusinessLending

MortgageLending

PersonalLending

Customer demand creating abundance of opportunities Uncompromising on quality Net 500 people in 2005, over 300 vacancies now Competition effect in line with expectations

9

AIB Bank UK Division 18%

18%

25%

11%

AIB Bank GB&NI

Great Britain

Northern Ireland

€322m €169m €153m

Cost / income ratio 48.7% (51.5% in 2004)

GB Selective business sector focus driving

outperformance Loans 31%, deposits 21% Market share gains in:

- private education - legal & accounting - healthcare - hotels

People acquisition a high priority Almost 50% in business developers

since 2003

NI Good performance in a lower growth environment

Loans 25%, deposits 12% Strong focus on cost management

High quality, high growth franchises

10

55%29%

16%Corporate Banking

Treasury

Investment Banking / Allied Irish America

Capital Markets 27%

Cost / income ratio 47.5% (54.4% in 2004)

Outstanding performance in Corporate Banking 33% Loans 29% Solid profit growth in premium Irish franchise > 70% profit from international franchises

Harvesting carefully planned skills transfer Strong growth in U.K., New York, structured / acquisition finance and debt management

Robust treasury performance 2% Strong customer business Low risk positions; trading profits not a material % of AIB

Investment Banking at centre of Irish corporate activity 22%

11

Poland 13%

Underlying profit 29% (pre disposal of business in 2004)

Cost / income ratio to 65.7% (67.4% in 2004) Performance driven by:

Non interest income 10% Tight cost management 3% Further provision reductions 54%

Early signs of loan book momentum 4% following flat H1 Personal cash loans 80% Maintaining risk discipline

Top tier mutual funds provider; income 115%, market share12.6%

Qtr 1 2006 - continuation of strong profit growth momentum

12

M&T 16%

Partnership Approach

23.5% shareholding (Dec 2005)

Acquired in 2003, equity accounted

IRR 24%

Best performing US Regional Bank Stock

Strong management driving performance in challenging environment

Cost management offsetting slow income growth

Cost / income ratio 51.2% (53.5% in 2004)

Further reduction in non performing loans and provisions

Qtr 1 2006 - performance in line with expectations

13

Operations – single enterprise approach

Core business banking and payment system

Vendor agreement signed Cross divisional application: staged

roll out over 2 years

Core retail banking system; implementation 2007 – 2008

2 new data centres – capacity & risk benefits

Home mortgages - improvement in response times

RiskManaged

Cost

Service Quality

Operational Excellence

Major investment programme underway

14

Growing our presence in competitive markets

Ireland

Great Britain

Poland

Rest of World

• Over 70,000 more customers than in 2004; increases in both business and personal sectors

• Improving trend in customer satisfaction

• Continuing migration from small to mid-market customers

• Consistent customer satisfaction underpins “best business bank” status

• Over 100,000 more customers than in 2004• Customer recruitment spread over key

sectors and products

• Leveraging competencies developed in Capital Markets

• Selective international expansion

High quality, sustainable growth

15

Positive “jaws” in all franchises

-2

0

2

4

6

8

10

12

14

Group AIB BankRoI

AIB BankGB & NI

CapitalMarkets

Poland

Income Costs

5% 3%

6%

3%

15%

%

16

Income / cost gap; a healthy relationship

2

4

6

8

10

12

14

2002 2003 2004 2005

Cost growth Income growth

%

17

Well contained costs

1,136 Staff costs 1,298 13

578 Other costs 583 -1

145 Depr. & amort. 130 -13

1,859 Operating expenses 2,011 7

“run rate” increase of + 5%

Performance compensation + 1%

Regulatory / compliance costs + 1%

+ 7%

Underlying *

2004 €m 2005 change %

* excludes impact of currency movements

2006 full year forecast + 9%

18

Strong asset quality

2004 2005

1.3 Impaired loans (ILs) % 1.0

5.8 Criticised loans / total loans % 5.1

0.7 Gross new ILs % 0.4

73 Total provisions / ILs % 78

20 Bad debt charge bps 15

19

75%

15%

10%

Tier 1 Core

Non-Innovative

Innovative

2004

Tier 1 - Components

76%

14%

10%

2005

Requlations

Core T(1) must exceed 51% of Total T (1)

Innovative cannot be >15% of Total Tier (1)

20

Funding

0

20

40

60

80

100

2004 2005

Capital

Senior Debt

CDs & CPs

Deposits by banks

Customer a/cs

55%

22%

10%

9%

52%

24%

10%

10%

%

Resource gathering is dominated by relationship sources. Wholesale sources remain under utilised, at year-end 2005 Total bond issuance was equivalent to only 9% of Balance Sheet.

21

AIB Debt Distribution - April 2006

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Tier (i) Tier (ii) Snr-Benchmk Snr-Priv.Place. ACS

Euro 82%

STG 14%

US$ 4%

Step-up issues – adjustedto earliest step-up date

Moody’s S&P Fitch

Aaa AAA AAA

Aa3 A+ AA-

Aa3 A+ AA-

A1 A(Lwr)/A-(Uppr) A+

A2 A- A+

€ (m)

Asses Covered Securities 3,500

Senior Debt - Private Placements 1,903

Senior Debt - Benchmark Issues 4,750

Tier (ii) 3,537

Tier (i) 1,710

Total 15,400

Debt Distribution€ (m)

22

Looking Forward

2006 Guidance:

16 May - Trading Statement, “targeting mid to high teens growth in adjusted basic earnings per share (EPS)…Loans are expected to increase by 25% (in 2006) ….and customer deposits by 15%....

Targets:

“consistent double digit EPS growth ….ROE in excess of 20%.....positioned to be in the top quartile of FTSE Eurotop Bank Index (E3Bank) on an adjusted EPS basis ………….3% Cost vs. Income Gap : JAWS

Strategies: Aggressive organic growth agenda

Disciplined capital management e.g. monetising value of balance sheet assets

Investing to manage growth centralisation of business locations single Enterprise wide systems

Implementation of Basel II , targeting Foundation Level

Diversify range of funding instruments

23

Contacts

AIB Group Investor Relations www.aibgroup.com/investorrelations

Executive : Alan Kelly T: + 353-1-6412162

Manager : Maurice Tracey T: + 353-1-641-4191

AIB Global Treasury bond.issues@aib.ie

Head of Liquidity & Funding : Gerry O’Connor T: + 353-1-6417891

Chief Dealer, Liquidity : Finbarr Dowling T: + 353-1-6417803

Chief Dealer, Funding : Duncan Farquhar T: + 353-1-641-7811

24

Appendix 1

The Irish Economy & Housing Market

25

Republic of Ireland Economic Trends

1990 1995 2000 2005 (e) 2006 (f)

Population (‘000) 3,506 3,601 3,789 4,131 4,230

Employment (‘000) 1,160 1,282 1,671 1,929 1,989

Unemployment (‘000) 172 177 75 86 86

Unemployment (%) 12.9 12.2 4.3 4.2 4.2

Inflation (%) 3.4 2.5 5.6 2.5 3.2

Govt surplus (deficit) (% GNP) (2.0) (1.7) 3.6 (0.4) (1.4)

GNP per capita (€) 8,712 12,936 23,460 32,486 34,165

GNP per capita (% change) 16.8% 8.5% 11.1% 7.7% 5.7%

26

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

0

2

4

6

8

10

12

14

16

18

The Irish Labour Market Has Been Transformed

Total Employment ’00S (LHS)

Unemployment Rate % (RHS)

The Irish Labour Market Has been Transformed(‘000s) (%)

27

Robust Public Finances

Government budget

Surpluses average 1.5% of GDP since 1997

Budget close to balance in coming years

Large current budget surpluses

Significant capital expenditure/borrowing

Gen Gov Debt/GDP ratio

<30% at end 2005(e) and declining

Down from 90% of GDP in past decade

Much less than half of eurozone average: 72%

Relatively Low Tax Economy

Well below eurozone average, similar to UK

Low PRSI/income tax, no local taxes

28

Population Growth

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

0-14 15-24 25-44 45-54 55-64 65+

1996 Census 2002 Census 2010 CSO ProjectionsSource: DOE and ESRI

Population Age Profile Estimates (m)

29

Rise in Housing Assets

0

100

200

300

400

500

600

700

Housing Assets€ (m)

30

Many Factors Underpin Strong Housing Demand

Continued strong inward migration

Favourable demographic trends

Untapped demand: Rising headship rates

Demand for second homes

Strong growth of economy and employment

Comfortable repayment affordability: longer term mortgages, lower cost

units, low interest rates

Government incentivised savings scheme (SSIAs) will mature in 2006/7

Home ownership is seen as an attractive tax efficient savings scheme, there

is no taxation on personal residential property

31

Summary: A Sound Economy

Public finances to remain close to balance

Very low national debt. Declining debt/GDP ratio

Low tax economy attracting FDI and workers

Virtual full employment despite high immigration

Favourable demographics supporting growth

Further boost to growth from SSIAs in 2006-07

Inflation back down at eurozone average

32

Appendix 2

AIB Trading Update

(released 16th May 2006)

33

AIB Trading Update

 Allied Irish Banks, p.l.c. (“AIB”) [NYSE:AIB] is issuing the following

update on trading following a review of performance in the year to

date. All trends in this update are in constant currency terms.

Since issuing guidance in February 2006 business in all our principal

franchises has been strong and these positive trends are being

sustained. Customer demand is buoyant and both the pipelines of

new business and their high levels of conversion at good rates of

return on capital underpin our confidence in the future. Asset quality

is very strong and recoveries of impaired loans are particularly high in

the year to date.

 Productivity continues to improve and we are targeting income

growth to exceed cost growth at enterprise and individual division

level. Economic conditions in our international and domestic markets

are good and create a very positive environment for us to develop

high quality business. We continue to invest heavily in our people

and systems to underpin and sustain profitable growth. The

investment programme in our operations is also designed so that we

are well positioned and prepared to meet industry wide regulatory

requirements.

Profit is expected to increase in each of our operating divisions this

year. We also anticipate a good increase in the contribution from our

investment in M&T.

For the full year 2006, we are now targeting mid to high teens

growth in adjusted basic earnings per share (EPS).* This

guidance is relative to the 2005 number of 145.9c. The rate of

EPS growth for the interim 6 months to June is expected to

exceed that of the full year’s due to a level of impaired loan

recoveries in the current period that we consider to be

exceptional.

Our planned growth will be supported through a combination of

capital we generate internally and capital we select from a suite

of other available sources. Our funding profile is conservative and

was recently boosted by the successful and efficient raising of

€3.5bn in the fixed income market.

* Excludes profit on Bankcentre sale and development, profit on Aviva / ARK Life

transaction and hedge volatility under IFRS

REPUBLIC OF IRELAND DIVISION

Our domestic retail and commercial banking franchise is

performing strongly. A higher interest rate environment is

expected to temper rather than materially reduce customer

demand and we are now targeting loans to increase this year by

around 25%, higher than previously guided in February. We

expect growth in customer deposits to be around 15%.

Competition remains intense although its impact is as anticipated.

Our recently revised suite of products and services further

underpins the resilience and potential of our market position. 

34

AIB Trading Update cont…./

 We have agreed a framework for performance related pay with our

staff that sets us apart from our peers. This action reflects our

confidence in the future and ensures we continue to attract and retain

key people to sustain long term growth. It increases the proportion of

variable costs and together with other discretionary investments in

our business will mean an above trend growth in costs this year.

However, we expect the rate of income growth to be greater than the

rate of increase in costs.

UK DIVISION

In Great Britain our focus on chosen business sectors continues to

deliver high quality growth. The consistent high grade customer

service we provide is creating an abundance of opportunities and

there is strong momentum in both loans and deposits. Our

aggressive business development plan is being executed by high

calibre teams in which we continue to invest and supplement with

additional skilled people. Branch and office locations are being

upgraded or relocated to ensure we optimise the potential of our

market position.

First Trust in Northern Ireland is performing well and in line with

expectations.

Full year loan growth for the division is expected to be over 20% and

deposits are expected to grow by around 15%.

CAPITAL MARKETS

Corporate Banking, which comprises over half this division’s

profit, is enjoying another outstanding year. We have a proven

ability to identify and establish premium positions in attractive

international markets from which we derive over 70% of

Corporate Banking’s profit. This ability, allied to a strong domestic

franchise is the hallmark of Corporate Banking’s consistent

outperformance. We are targeting loans to increase by around

20% this year and expect the pattern of strong profit growth to

continue.

Global Treasury is performing well. Performance in our customer

business is well distributed and robust across the major product

lines of foreign exchange, cash management and interest rate

risk management. Performance in our wholesale business is in

line with expectations with our bond management activities a

highlight.

Goodbody Stockbrokers and our corporate finance teams are

notable contributors to an overall good performance anticipated

in Investment Banking.

35

AIB Trading Update cont…./

 POLAND DIVISION

A year of strong profit growth is expected in Poland.

Buoyant demand for our best-in-class investment funds products is a

particular highlight. Momentum in the latter months of 2005 has

continued and inflows from new and existing customers are running

at record levels.

An increase in our loan book of around 10% is anticipated with good

demand evident for personal loans. Demand for local currency

mortgages is beginning to recover which we see as a welcome

development. The business lending environment is gradually

improving and while liquidity amongst corporates is still high there is

a positive outlook for investment spending which should increase

loan demand.

In the savings market, customers are primarily focused on investment

funds; we expect a single digit increase in our deposits this year.

 M&T BANK CORPORATION

A good contribution is expected again in 2006 as M&T maximises

opportunities in a relatively lower growth environment. In the first

quarter of this year, M&T once again exceeded market consensus.

Both efficiency gains and further improvements in asset quality were

highlights of performance.

MARGINS

In line with our guidance at the announcement of our 2005

results in February we continue to expect around 20 basis points

of reduction in our net interest margin this year. The causes are

the same as they have been for some time – loans growing faster

than deposits, lower reinvestment rates for customer account

funds, business mix and competition.

NON INTEREST INCOME

We are now targeting a significant increase of around 12% in

2006. In Poland, asset management, stockbroking and payment

processing fees are all growing strongly. Activity levels and

business pipelines are also well up on last year in our Irish

corporate finance business.

COSTS

We are confident that we will again achieve our core objective of

maintaining a positive gap of at least 3% between income and

cost growth. This year we expect an above trend cost increase of

around 9%.

36

AIB Trading Update cont…./

In this time of exceptional opportunity and income buoyancy we

consider it prudent to invest so that the long term health of our

business is assured. People recruitment and reward, building

common operating systems and a resilient risk, compliance and

corporate governance framework across the enterprise are all

essential ingredients vital to achieving this goal. In the event of an

income slowdown, the pace of investment would be moderated

without impairing our business

ASSET QUALITY

All leading indicators of asset quality are solid. We remain vigilant in

our assessment and management of risk; while this is an

exceptionally benign credit environment, there are currently no trends

or developments that lead us to foresee an imminent deterioration.

We now expect the bad debt provision charge in 2006 not to exceed

15 basis points of average loans. As referred to earlier in this update,

very high non recurring recoveries in the first half are likely to mean a

lower charge in the interim period to June.

NOTE

Group results for the interim period to 30th June 2006 will be

announced on 1st August 2006.