Mr. Robert Mulhall:

I thank members for their comments and questions which I have grouped into five key areas. I will start with the sustainability of the branch network.

The first point is there has been a lot of discussion about the intervention of digital services and what they mean for all businesses, not just banking. Our view in AIB is that digital services remove friction from banking. They make service provision much easier and provide greater accessibility, which is good news for the customer. However, it is still a service industry in which people meet people. That is where business is done. Therefore, the role of the branch network and, specifically, the role of the branch is changing and will continue to change into providing a far more advisory service, a place where commerce is executed. It is also worth noting that this is not just about bricks and mortar. We have a mobile workforce on the ground which is made up of agri, SME and asset finance advisers, etc. We are bringing the bank to the customer. We are very focused on ensuring we reach out to the customer in a meaningful way because that is absolutely in the interests of both the customer and the bank in order to ensure a free flow of credit and commerce within the business.

I stress, as I did in my opening statement, the substitution effects. I have mentioned our investment in digital services, as well as in An Post. The provision of services through An Post is a key aspect of our strategy. Someone highlighted the fact that, post the crisis, AIB had to close a number of branches. That was regrettable. However, we were conscious at the time that we wanted to ensure we would not leave our customers abandoned in service provision. We were focused, therefore, on the strategic partnership with An Post to provide services in a meaningful way.

There were questions about service provision. I will ask my colleague, Mr. O'Callaghan, who deals with local markets to talk about about future expansion.

The second issue on which I will focus is power and discretion in driving and the empowerment of local staff. In our opening statement I mentioned that we had changed the way we configured from a local markets perspective.

We now have 19 local markets across the island of Ireland. We are very focused on ensuring each accountable executive running those local markets is empowered to make decisions. We have returned some responsibility for credit decision-making back to branch managers. In circumstances in which branch managers do not have that discretion, and decisions have to be made by credit units, we have pushed the staff of the credit unit out into the regions. We are taking a decentralisation approach in that regard.

I take Deputy Heydon's point that if this message is not coming across, we need to do a better job of making sure our customers understand it. We see this issue as something that differentiates us from our competitors and that should be harnessed into the future. As part of our approach to ensuring there is autonomy of local markets, we have deliberately aligned our local market structure to the county structure of Ireland to ensure there is a feeling of community. We want people to feel that AIB is sticking with the community. Our sponsorship of GAA events is part of this.

I agree with the point that was made about back-office functions. It makes absolute economic sense to look at the migration of more and more services out of environments where labour and infrastructure costs, such as office rents, are high. We have some pedigree in that regard. There are over 400 staff working at our main contact centre, which operates out of Naas, where we have been for quite some time. It is quite a large local employer. We are continuing to look at how we can migrate other services that we do not have to operate from a centre in Dublin. We are looking at how we might set up a centre in Limerick to handle complaints and resolve issues on a national basis. We are conscious that driving in this direction works for our business model as well.

I agree that AIB needs to support business. As I outlined in the opening statement, we have seen an 11% increase in new money provided into the SME sector this year. We have partnered with the Strategic Banking Corporation of Ireland to ensure the pricing of that credit is appropriate to the business provision and the needs of our customers. We are very focused on the agricultural sector. It is our primary sector in Ireland. We recognise the role it plays in the overall indigenous economy.

I think our credentials with regard to supporting customers who are in difficulty and at times of difficulty, such as the flooding events I mentioned earlier, allow us to say we are very focused on providing such support. The world is not perfect. We will continue to evolve and to work with our customers on delivery. I will ask my colleague, Mr. O'Callaghan, to speak about the issues of service provision, our relationship with An Post and the expansion of services through our branches.