Irish AIB approves 25,000 loan interruptions: CEO
DUBLIN (Reuters) – Allied Irish Banks AIBG.I (AIB) has added 25,000 payment interruptions to its loan portfolios to help homeowners and businesses cope with the impact of the coronavirus, its chief executive said on Sunday.
Those cases have effectively more than doubled since the end of 2019, when AIB put in place forbearance agreements for a total of 22,276 customers, according to its annual results released last month.
Ireland’s five retail banks agreed last month to implement loan disruptions of up to three months for those affected by the virtual shutdown.
AIB CEO Colin Hunt told The Sunday Times in an interview that it was inevitable that some customers would need support beyond this period.
The 25,000 breaks agreed to by AIB, one of the country’s two largest lenders, include 15,000 mortgages and 5,000 businesses looking for breaks or working capital, Hunt said.
AIB’s main rival, Bank of Ireland BIRG.I, was processing a similar number of mortgage and business termination requests at the end of March, its chief executive said on April 3.
Hunt added that AIB was sticking to its announced average targets just a week before the government began to introduce a series of tough restrictions to slow the spread of the virus.
These goals include a return on equity of at least 8%, maintaining a leading Tier 1 capital ratio of 14% or more, and reducing the workforce from about 1,500 to less than 8,000 d. ‘by the end of 2022. “They are still valid,” Hunt told the newspaper.
Economist and former policy adviser in Ireland’s finance department, Hunt said the aim of the country’s banks is to “minimize the economic damage” caused by the pandemic on customers and “supercharge the recovery with the right products. When the health crisis manifests signs of slowing down.
“It’s more like a U-shaped recovery. I think the economy will pick up, but it could be well in 2021 before we get back to where we were at the end of February,” he said.
Reporting by Padraic Halpin; edited by Jason Neely