When AIB chief Colin Hunt left his job as an adviser to then-Treasury Secretary Brian Cowen to work for Australian investment bank Macquarie in 2007, a young Fine Gael Senator objected.
Doesn’t Hunt face a potential conflict of interest if he moves straight from the public sector to the private sector? After all, his intimate knowledge of government strategy from his time at the Treasury could give his new employer an unfair advantage.
In the end, Hunt’s new role was approved by the Outside Appointments Board and he had a successful banking career, landing the top job at Ireland’s largest lender in 2019.
Today, Paschal Donohoe — that Fine Gael senator in 2007 — has to wonder if he misjudged Hunt all those years ago, because the political wisdom he judged then was nowhere to be seen this week when AIB announced that it is withdrawing cash services from 70 of its 170 remaining branches.
The decision was uncharacteristic of the famously astute CEO, who hasn’t really made a single mistake in his three years at the helm of AIB.
On the contrary, he has gone from strength to strength to expand the bank’s remit from basically being a large building society with some corporate loans to something much more diverse and robust.
The list of achievements is impressive. He pounced on his old employer Goodbody when the Bank of China withdrew in 2020; that same year he entered into a potentially lucrative joint venture with Irish Life; and recently completed two large deals to buy Ulster Bank loan books. In the meantime, he is overseeing a slow but steady reduction in the state’s controlling stake in the bank.
He’s clearly a banker who works at high speed and with a certain degree of commercial aggression. Maybe he made a mistake there this week.
Those who know Hunt speak of a fiercely confident, intellectual man who not only considers himself the smartest man in the room, but most of the time probably is.
His intellectual pedigree is certainly impressive, having earned his PhD at Trinity under the supervision of Philip Lane, now Chief Economist at the European Central Bank. However, some former colleagues balk at the notion that Hunt is somehow distant, recalling instead a generous mentor who set a strong example of analytical rigor.
That tension can be felt in the industry debacle, because while there’s a rational economic argument for moving away from cash, Hunt clearly underestimated the emotional impact of the outright decision on communities already feeling neglected by the institutions designed to serve them .
Not being able to see around this corner has resulted in an absolute public relations disaster for the bank. Not even the record-breaking €97.5 million mortgage penalty imposed on AIB by the central bank last month drew as much negative attention.
Incredibly, the bank’s statement yesterday to reverse the decision reiterated the head-and-heart failure. She leads not with an apology, not with a retraction, but with 127 justifying words before admitting “public uneasiness”.
It’s a polite way of saying (finally) “I’ve lost the support of the Taoiseach.” Micheál Martin could see from Singapore, to which Hunt on Molesworth Street was apparently blind.
Paschal Donohoe was quick with a statement supporting AIB’s decision not to proceed with the proposed changes after being caught off guard by Martin’s intervention.
Notably, the statement included a reference to the retail banking review currently being conducted at the Treasury Department, clearly signaling that Hunt should have waited for the minister’s recommendations in November before being so bold
Ironically, the review process has already yielded some interesting nuggets to consider. What has emerged clearly from the department’s research to date? People really appreciate cash services in their local branch.
https://www.independent.ie/business/personal-finance/banking/colin-hunt-profile-brian-cowens-boom-era-adviser-is-confident-and-cerebral-but-failed-to-look-around-the-cashless-corner-41861559.html Profile of Colin Hunt: Boom-era advisor Brian Cowen is confident and smart, but has failed to look around the cashless corner