Bank of Ireland’s UK chief quits to lead sub-prime lender

The chief executive of Bank of Ireland’s UK unit, Ian McLaughlin, has quit to take over as head of London-listed sub-prime lender Provident Financial.

Mr McLaughlin joined Bank of Ireland in 2019 from NatWest Group, which was then known as Royal Bank of Scotland. Provident also said on Thursday – as it announced that the Northern native will be succeeding Malcolm Le May, its CEO of five years, in the summer – that it was changing its name to Vanquis Banking Group from March.

“I would like to thank Ian for his strong track record as CEO of Bank of Ireland UK, where he has been pivotal in the design and execution of strategy,” said Bank of Ireland chief executive Myles O’Grady. “Under his leadership our UK business has been significantly transformed.”

The move comes less than two months after the Government lifted a €500,000 executive pay cap at Bank of Ireland, after it sold its remaining shares in the lender, which had been the legacy of a crisis-era bailout. However, an effective ban on bonuses of more than €20,000 remains in place across Irish lenders that were rescued by taxpayers after the financial crash.

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The latest annual report for Provident shows that Mr Le May had a basic salary of £714,000 (€812,220) in 2021, but a £1.03 million bonus and other benefits brought his total remuneration to £1.97 million.

Mr McLaughin (56) also previously worked for Lloyds Banking Group and Zurich Financial Services.

Under Mr McLaughlin, Bank of Ireland UK’s retail mortgage book contracted from €23.4 billion at the end of 2019 to €18.4 billion at the end of last June, driven by the decision to abandon a previous plan to grow its UK portfolio aggressively and move into more bespoke, but higher value, home loans to the likes of professionals seeking larger-than-average loans and people looking to take equity out of their homes.

The unit also moved in 2021 to cut its Northern Ireland branch network by more than half to 13 locations as part of a major branch cull across the island.

Meanwhile, Provident said on Thursday that its new lending in the last three months of 2022 was strong as people relied on unsecured borrowing to meet expenses during a worsening cost-of-living crisis.

The group closed its home-collected credit business in 2021 to focus on its credit cards, vehicle finance and personal loans operations. Provident also pulled out of the Irish market that year.

Mr McLaughlin said in a statement that he was looking forward to working with Provident’s board and leadership team when he joins the group.

“We have a significant opportunity to responsibly support customers not well served by traditional lenders, and to deliver attractive and sustainable returns to our shareholders for the long term,” he said.