1 00:00:02,520 --> 00:00:07,040 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:07,840 --> 00:00:10,840 Speaker 2: So we've got key economic data here joining us from Trinity, 3 00:00:10,880 --> 00:00:13,600 Speaker 2: the PhD in economics, Colin, how would you like to. 4 00:00:13,640 --> 00:00:17,240 Speaker 1: Chime in, sir on US economic data and we avoid 5 00:00:18,720 --> 00:00:20,799 Speaker 1: the US is at a very instant juncture. You obviously 6 00:00:20,800 --> 00:00:24,480 Speaker 1: have an increase in inflation pressures, the signs of the 7 00:00:24,560 --> 00:00:28,000 Speaker 1: labor market is weakening. So this is a uncomfortable moment 8 00:00:28,000 --> 00:00:28,800 Speaker 1: for policymakers. 9 00:00:28,840 --> 00:00:31,520 Speaker 3: I suspect we welcome you from Allied Irish Bank. 10 00:00:31,560 --> 00:00:33,440 Speaker 2: Colunt Hunt with us here and of course with all 11 00:00:33,479 --> 00:00:37,720 Speaker 2: of his Trinity Economics. Let's first identify AIB right now, 12 00:00:37,960 --> 00:00:40,760 Speaker 2: this is safe to say you're owned by the Irish government. 13 00:00:40,840 --> 00:00:43,960 Speaker 1: How do you answer that question? We were owned by 14 00:00:43,960 --> 00:00:47,080 Speaker 1: the Irish government. The Irish government came to our rescue 15 00:00:47,240 --> 00:00:51,440 Speaker 1: post the GFC and for the period of about fifteen years, 16 00:00:51,479 --> 00:00:53,560 Speaker 1: the Irish government had a presence on our share register 17 00:00:54,160 --> 00:00:59,120 Speaker 1: and in June just gone, we marked the Irish government's exit. 18 00:00:59,520 --> 00:01:04,200 Speaker 1: And again the organization is one hundred percent privately owned 19 00:01:04,520 --> 00:01:06,479 Speaker 1: and in fact, one of the reasons that I'm here 20 00:01:06,760 --> 00:01:10,760 Speaker 1: this week with the Barclay's Financials conference yesterday and meeting 21 00:01:10,800 --> 00:01:13,440 Speaker 1: a lot of our investors, most of our very significant 22 00:01:13,480 --> 00:01:15,679 Speaker 1: investors are based here in the United States, so this. 23 00:01:15,680 --> 00:01:18,000 Speaker 2: Is very important. We'd like to have some news here. 24 00:01:18,240 --> 00:01:21,360 Speaker 2: Jennifer Dugan's waiting in Dublin for this. Can we suggest 25 00:01:21,400 --> 00:01:23,959 Speaker 2: that there would be some form of public offering of 26 00:01:24,040 --> 00:01:27,400 Speaker 2: shares of Allied Irish Bank in the coming weeks? 27 00:01:27,640 --> 00:01:30,080 Speaker 3: Quarters? Can you make an announcement today. 28 00:01:29,760 --> 00:01:32,319 Speaker 1: That there's certainly no announcement to be made because we 29 00:01:32,360 --> 00:01:35,679 Speaker 1: are one We're one hundred percent free floating at this stage. 30 00:01:35,680 --> 00:01:40,240 Speaker 1: So the government has exited the register. They came to 31 00:01:40,280 --> 00:01:43,160 Speaker 1: our rescue with about twenty almost twenty one billion euro. 32 00:01:43,480 --> 00:01:46,360 Speaker 1: We repaid that and now we are one hundred percent 33 00:01:46,400 --> 00:01:47,000 Speaker 1: privately owned. 34 00:01:47,040 --> 00:01:49,720 Speaker 3: This started well, it started very well, doctor. 35 00:01:49,760 --> 00:01:51,400 Speaker 4: How do you give us some perspective ons of the 36 00:01:51,640 --> 00:01:54,880 Speaker 4: appetite for cross border transactions at this point in time? 37 00:01:54,920 --> 00:01:56,680 Speaker 4: So here we're living this day in day out, the 38 00:01:56,720 --> 00:02:00,320 Speaker 4: kind of ambiguity or uncertainty about trade policy and andomic 39 00:02:00,360 --> 00:02:04,320 Speaker 4: policy more broadly, What do companies domiciled outside of the 40 00:02:04,400 --> 00:02:06,760 Speaker 4: United States think of this environment and how's that affecting 41 00:02:06,960 --> 00:02:07,480 Speaker 4: business as. 42 00:02:07,440 --> 00:02:07,840 Speaker 3: You see it? 43 00:02:08,919 --> 00:02:10,959 Speaker 1: Well, I suppose the environment we had a period of 44 00:02:11,000 --> 00:02:14,400 Speaker 1: uncertainty earlier on this year, very very warmly welcomed the 45 00:02:14,400 --> 00:02:16,600 Speaker 1: fact that we have come to an agreement between President 46 00:02:16,639 --> 00:02:20,120 Speaker 1: Trump and President vonder Lyin which was announced in Scotland 47 00:02:20,200 --> 00:02:23,120 Speaker 1: a few weeks ago. Businesses, you know, hates uncertainty. We 48 00:02:23,240 --> 00:02:27,280 Speaker 1: have certainty now. Would you pick a tier level of 49 00:02:27,320 --> 00:02:29,960 Speaker 1: fifteen percent? You wouldn't necessarily, but that's the reality. That's 50 00:02:30,000 --> 00:02:32,760 Speaker 1: what we're dealing with, and at least the uncertainty now 51 00:02:32,800 --> 00:02:36,000 Speaker 1: has been has been eliminated. The United States is a 52 00:02:36,040 --> 00:02:39,200 Speaker 1: hugely important market for Ireland, not only as a source 53 00:02:39,280 --> 00:02:43,680 Speaker 1: for our exports, but also as a place where. 54 00:02:43,560 --> 00:02:46,560 Speaker 3: Irish businesses invests. So typically Irish businesses. 55 00:02:46,440 --> 00:02:50,800 Speaker 1: When they outgrow a market that is growing quite robustly 56 00:02:50,840 --> 00:02:52,959 Speaker 1: but still quite small, they typically go to the UK 57 00:02:53,080 --> 00:02:56,040 Speaker 1: first and then they go to the United States. So 58 00:02:56,560 --> 00:02:57,840 Speaker 1: that was the path we followed. 59 00:02:57,919 --> 00:03:00,160 Speaker 3: We've been here in New. 60 00:03:00,120 --> 00:03:04,040 Speaker 1: York for fifty years this year, and we're still all 61 00:03:04,080 --> 00:03:06,240 Speaker 1: the way through the crisis, we maintained and all the 62 00:03:06,240 --> 00:03:08,640 Speaker 1: way through our period of government ownership, we maintained our 63 00:03:08,680 --> 00:03:09,800 Speaker 1: physical presidence here. 64 00:03:10,400 --> 00:03:11,960 Speaker 3: It's a really important. 65 00:03:11,560 --> 00:03:13,640 Speaker 1: Place from us from an investment perspective, but it's also 66 00:03:13,680 --> 00:03:17,480 Speaker 1: a really important country for deployment of our loan book, 67 00:03:17,639 --> 00:03:20,120 Speaker 1: and of course other Irish businesses followed us as well. 68 00:03:20,280 --> 00:03:22,720 Speaker 1: So you have the likes to see r H, the 69 00:03:22,880 --> 00:03:26,639 Speaker 1: likes of Smurfoot, WestRock, the likes of Kerry Group, all 70 00:03:26,800 --> 00:03:30,400 Speaker 1: having very significant exposures to the United States. Notwithstanding the 71 00:03:30,480 --> 00:03:33,480 Speaker 1: uncertainty we had earlier this year, it's still a hugely 72 00:03:33,520 --> 00:03:36,960 Speaker 1: important market and it's a hugely important provider of external capital. 73 00:03:37,280 --> 00:03:40,880 Speaker 4: How is the Irish economy doing today? When you look 74 00:03:40,920 --> 00:03:43,920 Speaker 4: at the housing market, at commercial investments, what's the relative 75 00:03:43,960 --> 00:03:46,400 Speaker 4: health of the Irish economy in twenty twenty five. 76 00:03:46,680 --> 00:03:51,200 Speaker 1: Colomy is doing quite well, like Irish GDP numbers. Because 77 00:03:51,200 --> 00:03:54,840 Speaker 1: of the scale of the international sector in the economy 78 00:03:55,200 --> 00:03:57,760 Speaker 1: can be wild and volatile, so we tend not to 79 00:03:57,760 --> 00:04:00,240 Speaker 1: look at GDP. We tend to look at modified mes 80 00:04:00,240 --> 00:04:02,560 Speaker 1: to demand. So this year we're talking about growth summer 81 00:04:02,600 --> 00:04:04,600 Speaker 1: of the order of about two point three two point five 82 00:04:04,640 --> 00:04:09,360 Speaker 1: percent in real terms, unemployment about four percent, and total 83 00:04:09,400 --> 00:04:12,280 Speaker 1: employment in the state now running a two point eight million. 84 00:04:12,640 --> 00:04:14,960 Speaker 1: That sounds small, but when I was in college all 85 00:04:15,000 --> 00:04:17,560 Speaker 1: those many many years ago, thirty five years ago or so, 86 00:04:17,880 --> 00:04:20,120 Speaker 1: we had one million people at work. So this is 87 00:04:20,160 --> 00:04:23,560 Speaker 1: an economy usherly transformed. Right and now when the best 88 00:04:23,560 --> 00:04:24,279 Speaker 1: performing in Europe. 89 00:04:24,360 --> 00:04:26,599 Speaker 2: Colin hunt with us with the Allied Irish Bank, and 90 00:04:26,640 --> 00:04:30,039 Speaker 2: we continue. We're commercial free with you across America, in 91 00:04:30,120 --> 00:04:33,239 Speaker 2: Ireland and around the world. Here is through this important 92 00:04:33,279 --> 00:04:37,599 Speaker 2: economic report in fourteen minutes ed Ludlow's schedule to be 93 00:04:37,680 --> 00:04:40,600 Speaker 2: with us. Here in a bit on the important Apple meetings. 94 00:04:40,720 --> 00:04:42,960 Speaker 3: I was talking with Olivia Fletcher. She calls me up. 95 00:04:42,960 --> 00:04:45,840 Speaker 3: Olivia calls Okay, She goes, did I wake you? It's 96 00:04:45,920 --> 00:04:50,440 Speaker 3: three am. I'm like, Olivia tiny hey, Colin, I got like. 97 00:04:50,560 --> 00:04:54,000 Speaker 2: An hour conversation with you, and I think frankly President 98 00:04:54,000 --> 00:04:56,919 Speaker 2: Trump could have an hour conversation with you. Let's talk 99 00:04:57,000 --> 00:05:02,640 Speaker 2: about this strange corporate book in Dublin, in the fact 100 00:05:02,640 --> 00:05:07,039 Speaker 2: that people sophisticated like Blackstone are literally giving the keys 101 00:05:07,080 --> 00:05:08,960 Speaker 2: back and office buildings. 102 00:05:09,000 --> 00:05:11,520 Speaker 3: What is the state of commercial real estate? 103 00:05:11,920 --> 00:05:15,400 Speaker 2: And as you say, a completely rebuilt Irish economy. 104 00:05:15,880 --> 00:05:19,599 Speaker 1: So the commercial real estate market had a very good run, 105 00:05:20,000 --> 00:05:22,680 Speaker 1: and then once we had the turn in the official 106 00:05:22,760 --> 00:05:25,040 Speaker 1: rate cycle, you began to see valuations coming. 107 00:05:24,800 --> 00:05:26,120 Speaker 3: Back quite a bit. 108 00:05:27,040 --> 00:05:29,880 Speaker 1: Of course, you had the COVID impact and the impact 109 00:05:29,960 --> 00:05:34,760 Speaker 1: on commercial valuations because of working from home. That would 110 00:05:34,800 --> 00:05:37,279 Speaker 1: have added it led to a drmward adjustment as well, 111 00:05:37,320 --> 00:05:39,680 Speaker 1: but we have seen quite a different step back in 112 00:05:39,720 --> 00:05:42,560 Speaker 1: valuation market clearing. I think the market is clearing, and 113 00:05:42,600 --> 00:05:46,640 Speaker 1: certainly we're beginning to see signs of people of higher 114 00:05:46,680 --> 00:05:49,719 Speaker 1: degrees of interest in the market. There are trades taking place. 115 00:05:50,520 --> 00:05:53,839 Speaker 1: The valuation adjustment seems to be behind us. If anything, 116 00:05:53,839 --> 00:05:55,599 Speaker 1: I would have expected that to happen a little bit 117 00:05:55,640 --> 00:05:58,599 Speaker 1: earlier because of the turn in the rate cycle. But 118 00:05:58,640 --> 00:06:00,160 Speaker 1: I do think we are at the bottom. 119 00:06:00,160 --> 00:06:00,680 Speaker 3: Cycling through. 120 00:06:00,800 --> 00:06:03,320 Speaker 4: A related question, perhaps closer to home, I'm wondering what 121 00:06:03,400 --> 00:06:06,560 Speaker 4: your offices are looking like. I remember reading you're trying 122 00:06:06,560 --> 00:06:09,080 Speaker 4: to get employees back three days a week. Some push 123 00:06:09,160 --> 00:06:10,280 Speaker 4: back to that, As I know, there was here in 124 00:06:10,320 --> 00:06:13,560 Speaker 4: the States with a number of financial institutions and other businesses. 125 00:06:14,040 --> 00:06:15,400 Speaker 4: Here we are at the end of the summer looking 126 00:06:15,400 --> 00:06:17,960 Speaker 4: to the fall. Where does that process stand? Were you 127 00:06:18,000 --> 00:06:20,040 Speaker 4: surprised by the reaction? Folks didn't want to come in three. 128 00:06:19,960 --> 00:06:21,480 Speaker 3: Days, so we didn't want to hear this question. 129 00:06:22,040 --> 00:06:24,200 Speaker 1: I will answer there's no question I don't want to 130 00:06:24,240 --> 00:06:25,880 Speaker 1: hear it. I'm more than comfortable in answering to that. 131 00:06:26,160 --> 00:06:26,920 Speaker 3: Look we had. 132 00:06:27,320 --> 00:06:30,480 Speaker 1: We have a situation where we have effectively three types 133 00:06:30,520 --> 00:06:34,159 Speaker 1: of work patterns inside in the organization. Our branch staff 134 00:06:34,200 --> 00:06:36,719 Speaker 1: are in five days a week. Our call center staff 135 00:06:36,760 --> 00:06:38,800 Speaker 1: are in five days a week, our security people in 136 00:06:38,880 --> 00:06:41,360 Speaker 1: five days a week. We have some people who work 137 00:06:41,400 --> 00:06:43,720 Speaker 1: from home two days a week. We currently have a 138 00:06:43,760 --> 00:06:45,640 Speaker 1: group of people who work from home three days a week, 139 00:06:45,800 --> 00:06:49,160 Speaker 1: and we're asking that group of our colleagues to come 140 00:06:49,240 --> 00:06:52,320 Speaker 1: into the office an additional day. I think it is 141 00:06:52,400 --> 00:06:54,920 Speaker 1: really good for culture. I think it's good for learning 142 00:06:54,920 --> 00:06:56,919 Speaker 1: and development. I think ultimately it is good for the business. 143 00:06:57,240 --> 00:07:00,520 Speaker 2: Question to Nicholas Booth at Stanford's wonderful giving me the 144 00:07:00,520 --> 00:07:04,240 Speaker 2: best explanation of this i've heard. Are you down the 145 00:07:04,320 --> 00:07:07,880 Speaker 2: road believing that you're going to compensate people who are 146 00:07:07,920 --> 00:07:11,080 Speaker 2: in five days a week versus the work from home crew? 147 00:07:11,640 --> 00:07:15,920 Speaker 1: Well, the contracts that people have layout in great detail 148 00:07:16,640 --> 00:07:18,600 Speaker 1: their base of employment. 149 00:07:18,680 --> 00:07:19,000 Speaker 3: We're not. 150 00:07:20,320 --> 00:07:23,200 Speaker 1: We incentivize our staff to come to work through a 151 00:07:23,240 --> 00:07:25,080 Speaker 1: salary check that arives in their account on the twenty 152 00:07:25,080 --> 00:07:26,760 Speaker 1: fifth of every month, just because of time. 153 00:07:26,800 --> 00:07:27,680 Speaker 3: I've got to get to this. 154 00:07:28,080 --> 00:07:32,200 Speaker 2: There's a back and forth on trade and everything within Ireland. 155 00:07:32,200 --> 00:07:35,000 Speaker 2: With America and tariffs, and Trump comes down to the 156 00:07:35,040 --> 00:07:36,720 Speaker 2: pharmaceutical industry. 157 00:07:37,120 --> 00:07:38,160 Speaker 3: Give us, give us. 158 00:07:38,040 --> 00:07:41,720 Speaker 2: A state that allied Irish Bank sees of yes, the 159 00:07:41,760 --> 00:07:42,760 Speaker 2: weight loss drugs. 160 00:07:42,760 --> 00:07:45,760 Speaker 3: I'm not using Gurris, just cut and chisels. 161 00:07:46,680 --> 00:07:50,840 Speaker 2: Help us with the pharmaceutical dynamic that will change given 162 00:07:50,920 --> 00:07:52,800 Speaker 2: decisions by President Trump. 163 00:07:53,160 --> 00:07:55,720 Speaker 1: So some of the biggest farmer names here in the 164 00:07:55,760 --> 00:07:59,080 Speaker 1: United States have have had a physical presence in Ireland 165 00:07:59,160 --> 00:08:03,040 Speaker 1: for over fifty years. Ireland is very attractive location for 166 00:08:03,240 --> 00:08:08,000 Speaker 1: US investment. Gives you open, unfettered access to the largest 167 00:08:08,000 --> 00:08:10,880 Speaker 1: single market in the world in the European Union, common 168 00:08:10,960 --> 00:08:14,760 Speaker 1: law English speaking, and we have of course a cultural 169 00:08:14,800 --> 00:08:18,160 Speaker 1: and perhaps fraternal affinity with one another across the Atlantic. 170 00:08:18,880 --> 00:08:22,560 Speaker 1: So we have very the deep rooted US pharmaceutical companies 171 00:08:22,600 --> 00:08:25,800 Speaker 1: in Ireland. They are it's a it's a big driver 172 00:08:25,880 --> 00:08:27,800 Speaker 1: of our exports to the United States. 173 00:08:28,320 --> 00:08:29,800 Speaker 3: We did go through a period of. 174 00:08:29,760 --> 00:08:32,760 Speaker 1: Grave uncertainty earlier on this year, but I'm very happy 175 00:08:33,040 --> 00:08:34,200 Speaker 1: that that has been eliminated. 176 00:08:34,240 --> 00:08:36,320 Speaker 3: Now we have some certain humulation to tariffs in that sector. 177 00:08:36,640 --> 00:08:39,240 Speaker 3: Thank you for getting life flat beds on air Lingus 178 00:08:40,520 --> 00:08:42,320 Speaker 3: is doing. I used to be a director of aer 179 00:08:42,360 --> 00:08:45,679 Speaker 3: Lingus I was. I was active one that pushed it through. 180 00:08:45,960 --> 00:08:49,000 Speaker 3: I don't know who told you that, but links it's 181 00:08:49,080 --> 00:08:52,880 Speaker 3: like Icelandic airways back. You brought an entourage with your 182 00:08:52,920 --> 00:08:57,760 Speaker 3: older oh, with Guinness too. What is air Lingus is 183 00:08:57,880 --> 00:08:59,679 Speaker 3: all of a sudden got a buzz to it? 184 00:08:59,720 --> 00:09:02,319 Speaker 1: Does when our lingas had a buzz to it going 185 00:09:02,320 --> 00:09:03,720 Speaker 1: all the way back to its privatization. 186 00:09:03,800 --> 00:09:07,000 Speaker 3: Really in two thousand and six, have you got much flatbeds? Fine? 187 00:09:07,120 --> 00:09:09,920 Speaker 1: The life bat you need to fly more often with 188 00:09:09,960 --> 00:09:12,720 Speaker 1: our lingus. They've had life flat beds for the best 189 00:09:12,760 --> 00:09:13,719 Speaker 1: part of a decade, if not. 190 00:09:13,720 --> 00:09:18,440 Speaker 2: More, well, you know they have, but now they're really 191 00:09:18,480 --> 00:09:19,080 Speaker 2: pushing it. 192 00:09:19,280 --> 00:09:21,160 Speaker 3: Colin, Right, can you come back again? Are you going 193 00:09:21,200 --> 00:09:22,960 Speaker 3: to be in New York in the next five years? 194 00:09:24,040 --> 00:09:25,880 Speaker 3: I hope here in the next five weeks. All right? 195 00:09:26,160 --> 00:09:28,680 Speaker 2: Led Irish Bank and we said good morning to Boston, 196 00:09:28,760 --> 00:09:32,520 Speaker 2: the new Elied Irish Bank years ago. Colin, and thank 197 00:09:32,520 --> 00:09:34,760 Speaker 2: you so much, Doctor Han of eled Irish Bank, their 198 00:09:35,360 --> 00:09:36,319 Speaker 2: chief executive