I propose to take Questions Nos. 24 and 69 together.
A banking licence allows the holder to undertake certain business activities set out in Annex I of Directive 2006/48/EC, which has been transposed into Irish law by the Central Bank Act 1971, the amended S.I. 395 of 1992, S.I. 661 of 2006 and S.I. 475 of 2009. It is a matter for the licence holder as to which of the permitted activities it will undertake and therefore a decision not to undertake certain forms of business activity will not affect the licence.
While it is disappointing that ACC and Danske Bank have taken the decision to withdraw from the Irish market one of the key features of banking strategy in the financial crisis has been the retrenchment to national borders. One of our expectations from the financial crisis is that market shares in traditional banking services will become more fluid during the recovery as the banking landscape continues to adjust to the withdrawal of foreign players, the restructuring of our incumbent banks and the increasing price transparency within financial services. The withdrawal of particular services and closure of certain aspects of the business of some banks is a realisation of this expectation.
We expect that over time this will present opportunities in the market for the entry of new market participants well positioned to be confident in the future profitability of an Irish branch or subsidiary. While the current market may not be attractive to a fully diversified bank challenger in the short term, I would expect new financial services providers to enter the market on a more targeted basis – such as specialised lenders and non-bank finance providers.