At its AGM in Dublin, chairman David Hodgkinson forecast a further increase in the number of loan impairments this year before stabilising at the end of 2012.
AIB says it has already put in place forbearance measures for 33,000 customers in difficulty meeting their mortgage repayments.
He says the aim of the bank is to treat customers fairly and keep them in their homes where possible.
“The current impairment percentages are in total 16%, so it has continued to increase” said Mr Hodgkinson.
“We expect the impairment levels to continue – it’s definitely slowing down – but to continue to increase this year and to stabilise and hopefully come down next year,” he added.