Mr. Myles O'Grady:

I thank the Chair and members for the invitation to address the committee this afternoon. I am joined by my colleague, Susan Russell, recently appointed CEO of our retail Ireland division.

Bank of Ireland plays a vital role in supporting the Irish economy and wider society. As one of Ireland’s largest publicly quoted companies and employers, we engage with Oireachtas Members across all parts of the country on a range of policy issues. We welcome that engagement and the opportunity to attend today’s meeting.

This is the first occasion the bank has been at the committee since the State completed the sale of its shareholding.

In that context, I again thank the State for the support we received. We made it a priority to repay the taxpayer as quickly as we could. At the end of the sales process, the bank returned almost €6.7 billion to the State from its original €4.7 billion investment.

At Bank of Ireland, we are ambitious for Ireland’s future. We have more than €49 billion in lending deployed in Ireland. This is helping people buy their own home, with more than 6,000 in the first six months of this year, as well as supporting our 300,000 business and corporate customers. Our ambition is to be the number one partner of choice for wealth and insurance in Ireland, with €42 billion in wealth assets under management currently. Our lending supports vital social and economic goals such as home building. In Ireland, we are funding the construction of approximately 18,000 residential units across 200 sites. Our recent strong financial performance has allowed us to increase our fund for residential development by 70%, to €1.75 billion. This is funding the development of a range of affordable, sustainable and social housing types. At the end of June, Bank of Ireland had €9.7 billion in sustainability related lending, an increase of 18%. We are the largest provider of green new mortgages in Ireland, while also helping business customers decarbonise.

Although our core business is in Ireland, we also have businesses in the UK and international activities in the EU and US. Close to one fifth of our workforce is based outside Ireland. That international reach allows us to help Irish companies expand internationally and to support the work of IDA Ireland and Enterprise Ireland. Today, we work with more inward investors to Ireland than any other bank.

In March, we set out a refreshed three-year strategy and, nine months into that strategy, I am pleased the group is delivering for customers, colleagues, shareholders and society. Our strong position allows us to continue to invest significantly in a number of areas, including systems, customer propositions and ways of working for a modern workforce. These investments have delivered customer improvements. We do not always get it right. Unfortunately, the IT outage we experienced during the summer fell far short of our standards. We are committed to continually investing in and improving the services we offer our customers.

The current interest rate environment is, of course, a matter of concern to the committee. Our approach has been to respond to rate changes while doing all we can to ensure customers do not face a repayment challenge with their mortgages. For example, although the ECB has increased rates by 4.5%, we have increased fixed rates by up to 1.75%. We have balanced this by introducing savings rates of up to 3%. Looking at our mortgage book in Ireland, approximately 70% is fixed. The majority of these do not re-price until 2025 at the earliest, protecting our customers from the rate environment. The remainder of our mortgage book are tracker and variable rate loans.

We are very aware some customers may get into financial difficulty and this is something we are closely monitoring. We have a proven track record of working with customers to find sustainable solutions. We have a wide range of options available to support customers, and work through these based on individual circumstances. If any customers are in difficultly or concerned about future repayments, the most important thing is for them to talk to us.

In conclusion, Bank of Ireland is this year celebrating 240 years of serving Irish customers. Our roots can be traced back to the popular demand for an Irish national bank to support commerce and trade. Our mission has not changed. We are here to support the Irish economy to grow and thrive. When Ireland is successful, we are successful. That fundamental fact remains at the heart of our strategy.