Bank of Ireland CEO Richie Boucher says he will ease back from his crisis-time style of leadership to give potential successors more control as the lender’s loan book returns to growth.
“We did take a deliberate decision during the tough times that I’d be the lightning rod” for public and political ire during the financial crisis, Mr Boucher, 56, said in an interview in Dublin on Wednesday. “I also had to be a shield.”
Since taking over as CEO six years ago, Zambian-born Mr Boucher shrank the lender’s balance sheet, shed jobs, and gave back €6bn to taxpayers after receiving a €4.8bn bailout.
Having returned to underlying profit last year for the first time since 2008, the bank expects its loan book to grow, according to Mr Boucher, after contracting 38% during the crisis as the bank sold assets and customers paid back loans.
“At the beginning of 2014, I was asking myself: ‘How do I, after five or six years of everything having to come to me, because every decision was life or death, step back.’ I’m still the CEO. I still have to be the captain of the team,” said Boucher.
Mr Boucher underwent surgery for early-stage colon cancer last year. He is still recuperating from complications from the operation, though is ‘‘well on the way to recovery”, he said.
Executives such as chief financial officer Andrew Keating, Retail Ireland CEO Liam McLoughlin, and Des Crowley, CEO of the bank’s UK consumer division, are to become much more visible to the public and investors, said Mr Boucher.
“It’s important for investors that they see the length and breadth of our management team,” he said.
Bank of Ireland’s shares have risen 27% in the past 12 months to 36.6c. They have soared from the 10c price at which the Government last bailed out the lender in July 2011 and it sold a 35% stake in the bank.
Bank of Ireland is alone among six lenders rescued by the State during the economic crisis to have escaped Government control.
It swung into net income of €786m last year from a €486m loss in 2013, it reported on February 27, as bad loans declined and lending margins widened in a recovering economy.
“Two years ago, the number one question from investors was ‘tell us about the bad debts’,” said Mr Boucher. “Now, it’s ‘when is your balance sheet going to grow?’ ”
Mr Boucher said that the bank’s board is sticking to a target of rebuilding its loan book to €90bn in time, from a net €82bn at the end of last year.
While the lender, founded in 1783, had been preparing for the loan book to start growing again in the second half of this year, this may happen sooner as a result of euro weakness against sterling and the dollar.
“We have started the year in all our businesses with good momentum, but you also have a positive exchange rate,” said Mr Boucher, adding that the UK loan book, which makes up about 40% of the group’s loan book, will translate into a higher amount of euro.
The bank may consider bolt-on acquisitions in the UK as part of a market consolidation, the group CEO added.
“We’d always have to look at opportunities,” said Mr Boucher. “It’s certainly something that wouldn’t be on our strategic agenda today. What we would look at is things that would enhance capability, rather than transformational.”
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