AIB head admits they have more to do to reach lending target
The head of business banking at AIB, John Webb, has admitted that some of its loan application procedures in the past were "over-engineered".
It comes as the Credit Review Office said it overturned almost €10m in loan refusals for small and medium enterprises and farmers in the last two years.
Its latest quarterly report shows that as a result, 813 full-time positions and 46 part-time jobs have been created.
Mr Webb said the bank has to do more when it comes to engaging with its customers.
The bank said in a statement this morning: "AIB acknowledges that more information is sought today from customers as part of the credit application process than has been the case in the past but believes this is appropriate to inform more prudent credit decisions but importantly it should not dissuade customers from applying. "
He said AIB lent €500m in new money in the first eight months of the year, and he is confident the bank will meet its lending target of €3.5bn by the end of the year, but he admits that they have more work to do.
Mr Webb said: "We agree we have more to do in terms of the levels of engagement with our customers, because in the past we were lending on the basis of security rather than cash-flow.
"And that does rely on a higher level of expertise for the borrower and also increased engagement with the customer. We are looking to simplify aspects of the process and procedures that admittedly are over-engineered."
The bank said: "AIB expects to exceed the €3.5 billion SME lending target set by the Government for 2012.
"This target relates to both new lending and refinancing/restructuring of debt, the latter of which is vitally important in sustaining businesses experiencing financial stress which are not seeking to add additional debt to their balance sheets.
AIB said it encourages its customers to appeal declined credit decisions where they believe the decision was flawed.
Their statement said: "We would point out that only 207 customers have chosen to avail of the facility since the establishment of the Credit Review Office and in that same time period AIB has processed more than 80,000 credit applications."
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