Bank of Ireland has reported a wider full-year loss in 2012 due to charges related to the movement in credit spreads and restructuring costs.

The 15 percent -state-owned bank said its pre-tax losses for full year 2012 widened to €2.2bn (£1.9bn, $2.9bn) compared to €190m losses recorded for the previous year. Yearly attributable loss was €1.8bn, compared to a profit of €40m a year ago.

Results for the year were hurt by non-core charges totalling €679m, compared to €1.3bn one-time gains last year. The bank recorded charges on the movement of its credit spreads of €297m and employee redundancy costs of €150m. Prior-year results benefited from a €1.8bn gain generated by an agreement by the Bank of Ireland's lenders to accept shares in lieu of the money owed to them.

Nevertheless, impairment charges on loans and advances to customers for 2012 came to €1.7bn, 11 percent lower than in 2011. Impairment charges on residential mortgages declined by €7m to €462m for the year.

Excluding one-time items, underlying pre-tax loss narrowed to €1.48bn from €1.51bn in 2011.

The bank said its operating profit slid by 9 percent to €1.9bn from €2.06bn a year ago while its operating profit before provisions fell to €242m, a 41 percent decline from the previous year.

The bank noted that about 1,200 employees or 9 percent of its staff had taken voluntary redundancy by the end of 2012. More employees are set to leave in 2013.

The bank added that while the number of default arrears has continued to increase, the pace of arrears formation has declined since the first quarter of 2012.

The group was the only Irish lender to escape nationalisation after an unprecedented property crash in the country. It paid €3.8bn to the state for the state support, returns on investments and repayment of investments.

Looking ahead, Bank of Ireland group CEO Richie Boucher said that its operating environment remains difficult and it continues to face many challenges, despite the recent improvements in the economy.

"Bank of Ireland has made good progress against our strategic objectives as we enhance our core franchises and rebuild profitability within a restructured, robust balance sheet, in what was another challenging year for the group," he said.