Mr. Jeremy Masding:

Regarding pay, we are all running an operational risk because of the Brexit firms that are coming to Ireland. We are under pressure in retaining labour. That is a risk to the value of the bank. However, what happened in the past cannot be replicated. There is a balance between the two. For me, it has to do with three elements, the first of which is control. The boards of the banks and the frameworks in which they work within the EBA have probably put in place much more effective controls against reward getting away from itself and moving to greed, which none of us wants.

Second, in order to attract and retain talent one has to have reward tools in one's toolkit. As long as they are controlled properly, I hope we can move towards that over time. Third, those controls and schemes have to be transparent so that no games are played. I would like things to move on because I believe we are running an operational risk. However, I think the controls and transparency that go with them are a critical part of the picture.

In terms of the accountability regime, there was a single sentence because I think we are still waiting to see exactly what it means. If it is similar to the senior managers' regime in the UK, which I know about, it is something that seems to be good practice. Having a role profile which identifies what one is accountable for, having organisational charts which have real clarity and having measures to demonstrate whether one is delivering value to the customer and getting value from the customer in the right measure all seem to me to be good banking practice. I can see no reason Permanent TSB and its board would not endorse that regime.

We have had to have different approaches to culture through different phases of the organisation's development over the past few years. The culture in the early days was trying to make sure we survived and focused on those things. Survival meant, for example, whether we could find solutions for customers who were about to lose their homes. The culture of survival was one I advocated at that time as the right mindset because there were fires everywhere. We then had to have the cultural fix and that goes back to Senator Conway-Walsh's comment about the control environment of banks. We all understand that we are the agents of depositors' funds and shareholder funds. I sometimes find that the conversations go to the lending side of the balance sheet. A bank cannot lend unless it has good funding and capital.

The second element was trying to put in place the better controls. We still have some way to go on that but I hope the bank is better managed than it was, albeit I do not want to sound over-confident as we still have areas to deal with. The third one is running the bank as a normalised banking institution. In my experience, a normalised banking institution needs to deliver what I call the customer value equation. We need to make sure we give value to the customers and that means understanding their needs and fulfilling them, not necessarily their wants because what they want and what we can give might be two different things. It means understanding their needs and delivering them in the sectors we choose. At the same time, within the boundaries of competition we have to make sure we get the right price for that because, as per the Senator's previous question, the value of the bank does not represent what it should for a minimum return.

The culture is around what we call delivering the bank of choice for our shareholders, customers and colleagues in the community we work in and, underpinning that, ensuring that we maintain our banking licence. It moves from survival to fixing to normalisation and growth. That is the corporate journey we are going on.

The last question was about exceptions. We try to manage those exceptions through the whole 12-month period. We have done a pretty good job in previous years. We have not run out too early, if that makes sense, and we will continue to try achieve that.