AIB has decided that its UK unit will report in future to the group’s retail banking managing director, Geraldine Casey, in Dublin, underscoring how the business has shrunk significantly in recent times.
This will see move from four core operating divisions to three – retail banking, capital markets and climate capital.
The development came as AIB also announced the promotion of its chief technology officer, Graham Fagan, to an expanded role of chief operating officer, as current COO Andrew McFarlane is leaving the group after three years. This will see the number of staff reporting to Mr Fagan effectively double to 2,300.
AIB, which has more than 10,000 staff in total, also said that its general council Miriam Nagle, appointed in January, will join the group’s executive team.
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“Today’s updates to our management structure means AIB will focus on Retail Banking, Capital Markets and Climate Capital,” said chief executive Colin Hunt, adding that the simplification of management structure will help with operational efficiency and resilience.
AIB UK, a stand-alone UK licensed bank led by managing director Hilary Gormley, has seen its gross loans shrink by almost 50 per cent to £5 billion (€5.78 billion) in the past decade, accelerated by review of its operations there in the wake of Brexit that saw it exit from the SME lending market in Britain and close a number of retail branches in Northern Ireland in 2021.
While it continues to offer full retail banking services in the North, it has narrowed its lending focus in Britain to niche corporate areas such as renewable energy, manufacturing and warehousing. Some of the larger ticket UK lending deals are handled by AIB’s capital markets and climate capital divisions.
The shake-up increases the responsibilities of Ms Casey, who was already in charge of AIB largest division, by far.
Rival Bank of Ireland’s UK loan book has contract by 25 per cent over the past 10 years to £14.1 billion as it narrowed its focus amid heightened competition in that market.
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This has been driven in recent years as the bank: reversed out of the mass mortgage market for higher-value bespoke home lending; stopped providing mortgages and personal loans through the UK post office; sold its British personal loans; and putting its corporate and commercial portfolio into winddown.
Minister for Finance Paschal Donohoe sold the State’s remaining 2 per cent stake in AIB for €305.3 million, bringing the total recovered to date from the bank to €19.8 billion.
It means that AIB is set to fall about €700 million short of repaying its €20.8 billion taxpayer rescue bill, including the expected €300 million the Government is on track to receive from selling back stock warrants it continues to hold in the bank.
The total AIB bailout recovery also includes proceeds other share sales, redemption of bailout bonds, interest, guarantee fees and dividends received from the bank over the years.
