Can new Ulster Bank CEO make it easier for boss to sleep at night?

Those on Royal Bank of Scotland’s first-half analysts call earlier this month would be forgiven for concluding that its chief executive, Ross McEwan, might have moved decisively to extricate the group from the Republic four years’ ago had he known then of the difficult task ahead.

"This is taking us longer than I ever anticipated," McEwan said. "It is No 2 on our get-done-list or things-that-worry-me list." (Group chairman Howard Davies quipped that he was McEwan's top worry.)

With her predecessor, Gerry Mallon, lasting just a year and a half in the job, incoming Ulster chief executive Jane Howard knows the pressure is on to deliver so that her boss can sleep better at night.

Ulster Bank has had to set aside almost €300 million in provisions in the past two years to deal with its exposure to the tracker-mortgage scandal. That’s the highest charge among the country’s five remaining retail banks.

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In addition, the bank took a further €101 million charge last year to deal with additional customers affected by “inconsistencies in documentation” relation to non-tracker mortgage holders and business customers. Drawing a line under these overcharging issues will be crucial.

Meanwhile, McEwan has signalled that Ulster's latest non-performing loans (NPLs) sale – a €1.4 billion soured mortgages portfolio, agreed last week – would likely be followed by another transaction as banks faces regulatory pressure to lower their NPLs ratio to the 5 per cent European Union norm. (Ulster's will be about 10 per cent when the latest deal goes through).

But having seen its loan book contract by over 50 per cent to about €21 billion since the onset of the crisis, Ulster Bank’s cost-income ratio remained a 81 per cent in the first half of 2018 – against a typical banking target of below 50 per cent, even after years of job and branch cuts.

With banks still struggling to rebuild their – performing – loan books a decade after the crisis, might Howard do something more imaginative to tackle Ulster's bloated cost-income ratio. Like revising the idea of merging with Permanent TSB (as recently suggested to Department of Finance officials by the European Central Bank's top banking supervisor, Daniele Nouy)? And slashing their combined expenses?