Banks address MPs

The four main banks have given evidence to the Northern Ireland Affairs Committee’s banking inquiry.

Ulster Bank

Ellvena Graham (Head, Northern Ireland) noted that it would be “very hard to move forward” until the property debt overhang was dealt with. Ulster Bank had announced that it wanted to lend £1 billion across the island but it also has to wind down its property debts by 2016. CEO Jim Brown confirmed that he has not lobbied for an extension and the bank is finalising a strategy on the issue.

Royal Bank of Scotland (its owner) had asked the law firm Clifford Chance to review the allegations of aggressive practices made in the Tomlinson review. Brown said: “No cases have been presented to us to actually review to see whether there have been any issues … I have seen no systemic issues of that nature within the business.”

Danske Bank

Danske Bank’s CEO in Northern Ireland, Gerry Mallon, clarified that it is “incorporated and regulated entirely in the UK.” It has a responsibility to its parent company as a shareholder but does not “primarily have responsibility to any of the Danish regulators.” The UK is “a really heavily regulated market” compared to other European jurisdictions.

Asked about the scope for sharing lending data with the Finance Minister – to shape policy within the Executive – Mallon said: “You have to be very careful with commercially sensitive information, but if we can get the appropriate non-disclosure agreements in relation to that, then I don’t see any problem with it.”

Bank of Ireland

Bank of Ireland UK’s CEO, Des Crowley, commented that Bank of Ireland has had “no constraints in the last number of years about the amount of lending we can do.” The biggest issue facing the economy is “a lack of demand for credit, rather than supply.” Growing the private sector was therefore equally as important as good banking.

Ian Sheppard (Head, Corporate and Business Banking) considered Northern Ireland to be “a very competitive market for good quality businesses.” The bank had identified room for improvement in its mentoring programmes and outreach programmes “to make sure that customers feel that they will get a fair hearing, or more than a fair hearing.”

First Trust Bank

Des Moore (Head, Northern Ireland) said that press coverage often gave a false impression of lending: “It may well be, for example, that SMEs believe that banks are not lending because of what they read in the paper or what they pick up in the media. But, in fact, we are approving 95 per cent of applications that come to us at the moment.”

Brian Gillan (Head, Business Banking) was unable to share the proportion of loan approvals that do not progress to drawdown as this was commercially sensitive. The number was “significant” but he and Moore would be “happy to share that outside of this public committee [meeting].”