'Social risk' assessment for AIB in tracker mortgage cases

Moody’s expects AIB to post “much weaker earnings for 2020 because of interest margin pressure from low interest rates, low fee income generation, rising credit costs, limited new lending opportunities, and higher provisioning costs”. Picture: File photo

Additional compensation to be paid by AIB over its part in the tracker mortgage scandal has increased “social risk” for the lender, while pressure is building on its earnings from the Covid-19 fallout, according to Moody’s Investors Service.

In a research note, the ratings firm said the additional payment for its EBS and Haven customers will weigh to some modest extent on the AIB's ratings but will likely have no implication for the assessment of those ratings at this stage.