Gerald Nash (Louth, Labour)
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136. To ask the Minister for Finance if there is anything cited in the relationship framework agreement between the Minister and a bank (details supplied) that prohibits or in any way prevents him from meeting with the bank to discuss and negotiate on a change to that agreement; if he plans to do so given the unprecedented context of Covid-19 and the difficulties for personal and business customers; and if he will make a statement on the matter. [39155/20]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy is aware, as Minister for Finance I have no role in the commercial decisions made by the banks, including the structure and level of pricing for their various product offerings for both personal and business customers. This applies equally to the banks in which the State has a shareholding.

Decisions in this regard are the sole responsibility of the board and management of the banks which must be run on an independent and commercial basis. The independence of banks in which the State has a shareholding is protected by Relationship Frameworks which are legally binding documents that cannot be changed unilaterally.

The Deputy will be further aware that as set out in the Relationship Framework for AIB, due to its systemic importance to the Irish financial system, the bank received significant support from the State in the financial crisis.

This support led to the State becoming the majority shareholder in AIB with the approval of the European Commission. This approval was subject to the Minister and the Bank entering into the Relationship Framework on terms agreed by the European Commission. One of the reasons for this was to ensure that the Minister’s shareholding did not result in breaches of competition law rules.

Critically, and as set out in the Relationship Framework, any amendments to, or revocation or replacement of, the Relationship Framework must be made following consultation with AIB and upon the instruction, or with the agreement, of the European Commission.

As is clearly set out in the Relationship Framework, the board of AIB has full responsibility and authority for all of the operations of the bank in accordance with its legal, fiduciary, and regulatory obligations. The Relationship Framework further provides for safeguards as to the separate management of each of the State’s interests in Irish credit institutions (including in the Bank) in order to ensure that those interests, and the management of those interests, do not lead to a prevention, restriction or distortion of competition in contravention of merger control or competition law rules.

It is therefore the case that any proposed amendment to the Relationship Framework must not only be in accordance with the regulatory requirements under which AIB operates, the State Agreements more particularly set out in the Relationship Framework, and the law, the proposed amendments must also be approved by the European Commission following consultation with AIB.