Bank of Ireland Group plc (the "Group")
Further update on UK Motor Finance
20 October 2025
Following publication of the Financial Conduct Authority's ("FCA") consultation paper on 7 October, in respect of a proposed industry-wide redress scheme on UK motor finance commissions, the Group has undertaken an assessment of the potential financial impact of the proposed scheme.
The Group's existing provision of £143 million (€167 million) at 30 June 2025 was based on probability weighted scenarios and captured the then best estimate of the redress and compensation that may have been payable to impacted customers, along with associated costs that may have been incurred by the Group in connection with any FCA redress scheme and/or legal proceedings.
The FCA's proposals are subject to consultation and therefore may change. Based on the proposals in their current form, t he Group now estimates that the provision could increase from £143 million to c.£350 million (c.€400 million). The estimated increase is due to the increased likelihood of a higher number of eligible cases, the construct of the proposed redress methodology and the customer engagement approach. The provision will be updated as part of the Group's FY25 financial reporting process, reflecting the final form of the redress scheme and any further relevant information. The final cost to the Group could change depending on the outcome of the consultation, actual customer opt-in rates and any further legal, regulatory or industry developments.
If the provision was increased to £350 million, it would reduce the Group's 30 June 2025 CET1 ratio of 16.0% by c.35 basis points. The Group continues to be highly capital generative.
The Group is committed to achieving a fair outcome for customers and ensuring that appropriate redress is provided where loss has occurred. However, the Group does not believe that the FCA's proposed redress methodology reflects the actual loss to customers or achieves a proportionate outcome. In addition, the FCA's proposed approach for assessing unfairness does not align with the legal clarity provided by the recent UK Supreme Court judgement. The Group will engage with the FCA on this basis.
The Group will issue its Q3 interim management statement on 29 October.
Ends
For further information please contact:
Bank of Ireland
| Mark Spain, Group Chief Financial Officer |
+353 1 2508900 ext 43291 |
| Eamonn Hughes, Chief Sustainability & Investor Relations Officer |
+353 (0)87 2026325 |
| Damien Garvey, Director, Group Corporate Affairs |
+353 (0)86 8314435 |
Forward Looking Statement
This document contains forward-looking statements with respect to certain of Bank of Ireland Group plc (the 'Company' or 'BOIG plc') and its subsidiaries' (collectively the 'Group' or 'BOIG plc Group') plans and its current goals and expectations relating to its future financial condition and performance, the markets in which it operates and its future capital requirements. These forward-looking statements often can be identified by the fact that they do not relate only to historical or current facts. Generally, but not always, words such as 'may,' 'could,' 'should,' 'will,' 'expect,' 'intend,' 'estimate,' 'anticipate,' 'assume,' 'believe,' 'plan,' 'seek,' 'continue,' 'target,' 'goal,' 'would,' or their negative variations or similar expressions identify forward-looking statements, but their absence does not mean that a statement is not forward-looking.
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