Mr. Sean Farrell:

As Mr. Cunningham outlined, agriculture is a very important sector for Bank of Ireland, and this is particularly evident when we consider our rural-based branches located in the many towns that rely most on the agricultural economy. Within those branches, agriculture-related lending typically represents over 60% of all business lending transacted through those branches, so it is a very important sector within the branch network.

In the overall market and with the requests coming to us in the bank in mind, the typical areas for which customers seek financial support are land purchase, farm development and annual seasonal loan requirements. We have seen an increase in requests for farm buildings and development from the dairy sector in particular over the past 18 months, despite the downturn in milk prices. We anticipate that dairy markets will recover from current levels in 2016 and that will prompt additional investment at farm level as farmers capitalise on the post-quota opportunity to expand their businesses. Our position in the bank is that farm expansion of any enterprise, not just dairying, should be from an efficient base. However, given the profitability of the dairy sector relative to others, we anticipate proportionately greater growth in the area over the next number of years. Volatility is key to the committee's business today and, in that regard, our view is that the outlook for agricultural commodities is positive and we expect prices to increase over the next five to ten years. We do not anticipate the price increase will be linear, as there will be peaks and troughs. That is similar to what is currently being experienced within the dairy sector.

In the bank we take a medium-term view on farm incomes and we will play our role in helping our customers manage through the impact of sudden price shocks in the form of either falls in output prices or increases in input prices. To that end, within Bank of Ireland we have developed a suite of products that we have termed AgriFlex, which take volatility into consideration and allow our customers to revert to interest-only repayments on borrowings with the bank during times of reduced farm incomes.

Looking forward to the remainder of 2015 and into 2016 from a cashflow support perspective, to date there have been few additional requests to what we would normally receive from customers. The requests we have received to date have not typically been related to milk prices, but have arisen more because of superlevies or other issues.

We do anticipate, however, that there will be increased requests for cash flow support during the first half of 2016. Farmer overdraft utilisation levels remain very low. Our typical farming customer started this year in a stronger cash flow position than in 2014. They have overdraft balances of just 15% of their overall permission levels. The overall risk profile and credit quality of our agri-customer base has improved through the year.

In the same way as we supported farming customers during the fodder crisis in 2012 and the dairy market downturn in 2009, we will again support them, as necessary, where we are comfortable with the overall viability of the farm. AgriFlex is one of the ways we can offer that support. To bear this out in the next few weeks, we are planning to contact our farming customers in writing to invite them to come and meet their local bank adviser should they envisage any requirement for cash flow support in the coming months. In addition, our team of agri-managers who are based regionally throughout our branch network are engaging with farmers in groups and in conjunction with their advisers and accountants. Through a case study exercise, we are helping to educate farming customers on their repayment ability andthe importance of cash flow planning. We are also encouraging them to engage with their local banks at an early stage if they have a future borrowing or cash flow support requirement.

We will be very happy to answer questions on our support for the sector.