AIB denies offering ‘special’ deals to its high-prof ile debtors
AIB has denied offering ‘special’ debt writedown deals for high-profile customers, saying each loan is approached on a case-by-case basis.
And the bank has apologised to customers who went through ‘torture’ feeling they were treated differently following revelations that former GAA star DJ Carey secured a significant settlement with AIB in 2017 on a loan worth more than €9.5million.
Representatives of AIB appeared before the Oireachtas Finance Committee yesterday. Its managing director of retail banking, Jim O’Keeffe, told the committee they were aware of recent commentary about its approach to debt write-downs, but were unable to discuss the details of an individual’s case. ‘Unfortunately, many aspects of this commentary have been incomplete and have not presented the full picture,’ he added.
Sinn Féin TD Pearse Doherty said that people had been asking if the bank has a policy for the top 1% in the country that differs for the rest of the population. ‘We do not,’ Mr O’Keeffe said. ‘We deal with every case consistently and fairly, we have a governing set of policies that are reviewed internally, right up to the board.
We have a regulator... I can categorically tell you, there are no special deals for special individuals coming to AIB.
‘And I do apologise to our customers who have been put through torture over the past week to ten days, where they’ve been made to feel they have been subjected to something that doesn’t happen for a wider group. I can assure you, that is not the case.’
In its opening statement, the majority State-owned bank said that, excluding those who went through a bankruptcy or insolvency process, about 1,900 borrowers received a reduction of more than 90% of their loan. The bank said that this represents just over 1% of 150,000 customer resolutions reached since 2015.
‘They were subjected to the same consistent policy application, there were no special deals in that 1,900,’ Mr O’Keeffe told the committee.
When asked how many of the 1,900 loans were worth more €1million, or what was the total value of the write-downs, Mr O’Keeffe said ‘it is not a number that we disclose today’. He said that the 1,900 would have included loans worth over €1million, but they were not the majority.
Questioned further on the nature of those loans, Mr O’Keeffe said that the bank would consider disclosing more information, but there were concerns about ‘commercial sensitivity’.
He said that the total value of all write-downs between 2015 and 2021 was €3.5billion, and was publicly available.
Labour senator Marie Sherlock said that despite the State having a majority stake in AIB, ‘taxpayers have little or no transparency as to the type and scale of write-downs that you offer your customers’. Fine Gael TD Bernard Durkan said it should be ‘clearly illustrated’ to the general public why debt is written off. ‘I think it’s very important that the general public get to know that the rules that are being applied are the same rules for everybody and that there is no suggestion anywhere of a special deal for special people or for preferential borrowers,’ he said.
Responding to Fianna Fáil TD Robert Troy, Mr O’Keeffe said that he could understand the frustration of some people who could not reach a resolution with the bank, but added that AIB has certain obligations in recovering debt.
He said: ‘You’re owed a million, somebody says: “We’ll pay you half a million, you won’t get any better than that anywhere else.”’ That is irrelevant to us, because we have to work through the financial standing of the customer. And very often we don’t get the right information shared with us. We don’t get the sworn statements shared with us... If we are not getting the full disclosure, we cannot take the risk of leaving money on the table at a later date at a committee such as this being accused of not being consistent across the board.’
Fianna Fáil TD and committee chairman John McGuinness said there had been ‘significant disquiet’ from the public about how debt writedown is approached. ‘I think you owe it to customers that you’ve settled with as much as you owe it to the customers that are looking for debt resolution,’ he said, asking the bank to ‘flesh out’ answers to some questions that had been asked by deputies.
‘Significant disquiet’