Ms Margaret Hayes:

I thank the Chairman and members for the invitation to attend this meeting. I hope we can be of help to the committee in answering questions. Like Mr. MacSharry, I joined the board of what was then Irish Life & Permanent Group Holdings plc in December 2008 following a request by the Minster for Finance to join the panel to which Mr. MacSharry referred. Mr. MacSharry has already outlined the circumstances surrounding our respective nominations and the expectation of the role we would play.

As is also clear from his opening address, the company has undergone significant structural change in the period since then. Today, the company has changed its name and is called Permanent TSB Group Holdings plc - the holding company for Permanent TSB. The changes that have taken place within the company have undoubtedly been extensive in nature and were directed and driven by the board in response to the ongoing changes in the circumstances in which the company found itself and which it had to address. In addition to those changing circumstances, Mr. MacSharry has spoken about the sense of crisis and the loss of confidence in the banking sector that was pervasive in 2008. However, simply making that statement does not do justice to just how extraordinary the crisis was and how real was the threat to the country's financial system. I have no doubt that at that time we were at a point where the very fabric of our banking infrastructure was in peril, and not just the continued survival of Permanent TSB itself.

In the period since our appointment we have focused on trying, first, to ensure the survival and future viability of the bank in the face of unprecedented stress both in funding markets, and in the speed and extent of credit deterioration and the pressures that put on capital held by the bank. We have tried to avoid having to take capital from external sources into the company. We are now trying to support the stabilisation of Permanent TSB and its restoration to a position of significance in the banking world and the economy. Mr. MacSharry and I are both satisfied that the bank has, since 2009, succeeded in building up a management team with the skill set and capability to meet the challenges facing the bank in the future, and the ability to realise the full potential of the bank as a real competitive force in the Irish retail bank market.

A root and branch analysis of policy and strategy has been completed and the resulting restructuring plan, after presentation to the Government and the troika, has been submitted to the EU. In the interim, work has already started on implementation of the plan with the full and enthusiastic commitment of all bank staff. We have also worked with our fellow directors to try to ensure that the bank understands the wider context in which it operates and the responsibilities it now has to act in the interests of the wider community. That is particularly relevant when it comes to issues such as interest rates, arrears management and assisting individuals and households to achieve their financial plans. Those are the kinds of areas where the wider community has a keen interest in the policies adopted by individual banks.

In that regard, I believe Permanent TSB has made significant progress in recent months not least, as Mr. MacSharry has said, by reducing unilaterally its standard variable rate, SVR, for mortgages and by establishing a professional arrears management unit to support its work with customers in arrears. The next step is to complete the work, now well advanced, on delivering attractive new banking products to the Irish consumer, which meet his or her requirements and also help deliver some much needed stimulus to the economy. The challenge for all on the board, and in management, is how to strike the correct balance between, on the one hand, protecting the money the taxpayer has invested in the bank and, on the other, acting appropriately in respect of its customers, and particularly its customers in arrears. That is a very difficult balance to strike, but I can assure the committee that throughout my time on the board, no issue has generated more discussion and reflection than this and I expect this will continue to be the case for as long as the State remains a significant investor in the bank. I too thank committee members for their attention and time.