Cost of bank's recent travails will only emerge in full-year figures

The full impact of the interest loading controversy on National Irish Bank's business will be become clearer when the bank announces its full-year results in November. Its senior executives refused to make any predictions about the bank's trading performance over the coming months yesterday, but insisted that, despite its difficulties, it was managing to hold on to its customers.

NIB chief operating officer, Mr Philip Halpin admitted the bank did lose business in the immediate aftermath of the controversy, with customers closing accounts and withdrawing their funds. He refused to quantify how much money had left the bank apart from indicating that there had been a "fall off" in deposits. Mr Halpin stressed that the bank had since recouped much of that money, claiming that its deposits now stand at around the same levels as they were before the revelations were made public. When asked about how many current accounts had been closed, he said this was more difficult to determine, as these type of accounts can be closed "in the normal course of business". Mr Halpin also said he was unable to comment on the impact of the allegations on the branches where the interest loading activities were uncovered, but stated that business levels had been good overall. The executives refused to comment on the interest loading activities and the sale of offshore investments to clients, which are at the centre of a number of official investigations.

Chief executive, Mr Grahame Savage, declined to disclose if any customers had initiated legal proceedings but confirmed the bank had not made any provision to compensate customers who had been wrongfully charged.

Mr Savage said that, despite its difficulties, the bank remained focussed on expanding its Irish operations, and expected it could return to "business as usual" in less than six months. "Our progress will be no more difficult that it was in the past. The longterm growth of the bank is not in question. Events don't make it any easier but whether we achieve this will be up to the management."

Mr Savage said the increased workload created for its staff by the controversy had held the bank back. "We have gone a little quiet. In the last few months, we have not been very aggressive because of the increased workload at the branches. It would not have been a good idea to load on top of that a lot of advertising to generate new business but for the rest of the year it will be business as usual."