Mr. Eddie Cullen:

Every contributor has asked about pricing. We are the only foreign-owned bank now operating in Ireland, following several exits. Our position would be that providing competition is part of what we do. We have the smallest market share so we are very focused on trying to provide that competition. In discussing the cost of capital for a bank, a bank has multiple stakeholders so we must think about depositors and those who provide capital as well as those who borrow money from us. Part of the challenge is to ensure that we are even-handed across those stakeholders. As my colleague from Bank of Ireland commented, and this would be something that would be well understood in terms of capital inputs or, to use the technical term, the risk-weighted asset input that Irish banks have compared to European banks, is relatively high. There are many reports which go to that point. This is something that will need to work its way out of the system over years as we move past the crisis. The models that we use are something that we are all working on with the regulatory authorities. We also see in Europe the history of using guarantee schemes, such as those which SBCI has brought to the market, is much more deeply embedded. The SBCI have been bringing that focus to the Irish market and will continue to do so. As we see that come in over time, it will have an impact on relative pricing. On another occasion I have told this committee that from our perspective, as a UK-owned bank, we have the opportunity to compare and contrast, particularly across sectors, what pricing is like in the United Kingdom versus here. We discern very little difference, particularly in this sector, with what farmers in the UK pay for credit compared with what Irish farmers pay.