AIB boss Colin Hunt is clearly blessed with a brass neck

AIB boss Colin Hunt is clearly blessed with a brass neck. The bank raised full-year forecasts this week on the back of a “very strong first-quarter performance” driven in large part by rising central bank rates.

Net interest income is now expected to come in more than 50 per cent higher in 2023 than last year at a whopping €3.3 billion. In the first quarter it was 93 per cent up on the same period last year and 16 per cent ahead of the previous three months. The bank’s total income in those first three months was 70 per cent.

The key factor behind that is rising central bank interest rates. Rates in Europe have jumped by 3.75 percentage points. In the UK the jump has been even bigger, at 4.15 percentage points. AIB has close to €35 billion on deposit with central banks here and in the UK, earning returns its deposit customers could only dream of.

At its annual general meeting on Thursday, the bank offered those savers vague platitudes, saying higher interest rates for depositors were “on the agenda” but offering no details.

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Mr Hunt said the bank had a “very broad array of customers, and we had to be conscious of our obligations” while its trading statement referred to the stability of its deposit book.

In bottom-line terms, that translates as the bank being comfortable that its depositors are going nowhere, allowing it to generate very strong returns on their backs for the benefit of the bank and its shareholders while buffering borrowers and, more importantly, the bank itself against the peril of loan defaults.

Why those AIB customers trusting AIB with €102.2 billion in savings would not look elsewhere for a better return is a mystery. They are providing the funds on which the bank is making its profits and getting next to nothing in return. Quite frankly, Mr Hunt and his team are giving them the two fingers.