Ms Francesca McDonagh:

Last year, we set a strategy to grow our total lending across all of our businesses by 20% to €90 billion. Last year was the first year we had a net lending book growth which is positive. The total strategy from now until 2021 is that two thirds of that growth will come from our Irish business and a third from our UK and international business. What we are seeing at the moment, however, is more 50-50. Half the growth we are experiencing comes from our UK and international businesses while the other half comes from retail Ireland such as SMEs, mortgages and consumer lending.

We believe that when there is more clarity on Brexit, whether it is good or bad, there will be more certainty, particularly for Irish SMEs, to activate deferred business decisions. It does not necessarily impact on mortgage lending. However, it impacts on consumer confidence. The supply and demand dynamics are much more prevalent in Irish mortgage growth. For SMEs, we would see that there is some overhang from the crisis. They are generally cash generative, meaning they can invest some of their cash reserves. There has been a reticence among SMEs to take on new borrowing until they have clarity in respect of Brexit. When clarity, hopefully, does come, that will provide some more direction for SMEs in terms of whether they broaden their manufacturing in Northern Ireland or partner with a supplier in continental Europe. Some of these decisions are waiting due to Brexit uncertainty.

We remain committed to our 20% loan book growth strategy. It depends on external factors and it is predicated on some type of deal being done on Brexit with a reasonable transition period.