Bank of Ireland expands UK lending reach with breakdown cover tie-in
Bank of Ireland plans to expand its £26bn (€37bn) UK loan book after agreeing to provide financial services under the brand of AA, the country's largest provider of breakdown assistance to motorists.
The partnership will run for as long as 10 years, and will cover credit cards, unsecured loans, savings and mortgages, and build on Bank of Ireland's existing tie-in with the UK Post Office, the Irish bank said in a statement yesterday.
Bank of Ireland chief executive officer Richie Boucher said in March that he sees the UK as a growth opportunity, including because demand for new loans remains muted here. The bank may consider "bolt-on" acquisitions to boost its presence in the UK, which accounted for 40pc of its €89.5bn loan book at the end of last year, he said.
The AA has about four million individual members and nine million business customers in the UK, or more than 40pc of the roadside assistance market, according to Bank of Ireland.
The first product, a new credit card, is scheduled this month, with the first AA-branded mortgage set for 2016, AA said in a separate statement.
John Cronin, an analyst with Investec, said Bank of Ireland increased its share of new mortgage lending in the UK to 1.1pc in the second half of last year from 0.6pc in the first half.
"A tie-up with the AA significantly further strengthens the bank's distribution capability in the UK," Mr Cronin said
Damien Daly will become managing director of the new AA-focused unit for Bank of Ireland.
As a result, the bank has appointed Kelvin Gillen as its new director of customer analytics, insights and marketing, Mr Daly's previous role.
Mr Gillen is joining Bank of Ireland from Danske Bank in Copenhagen, where he was most recently the senior vice president, strategy and insights.
At Danske, he was responsible for the formulation and execution of the bank's personal banking strategy, and also the business intelligence and analytics functions.
A native of Sligo, Mr Gillen has 20 years of international experience in the financial and technology sectors.
He previously worked with UniCredit in Milan; Principal Financial Group in the US; and ABN Amro in the Netherlands. He takes up his new Bank of Ireland role next month.