Green mortgages now account for half of new Bank of Ireland Irish home loans

Bank of Ireland launches Sustainability Report for 2022

Friday 28 April, 2023 – Bank of Ireland ended last year with c.€8 billion in sustainability-related finance on the balance sheet and plans to nearly double that figure to €15bn over the course of its updated corporate strategy which runs to the end of 2025. Green mortgages accounted for c.50% of total Irish mortgage lending in 2022, up from 35% a year earlier.

In its Sustainability Report for 2022, published today, Bank of Ireland provides detailed disclosures and updates on a range of Environmental, Social and Governance (ESG) topics. The report also shows how the Bank’s new partnership with Musgrave Group helped one Ballincollig retailer cut its energy consumption by more than a quarter.

Eamonn Hughes, Chief Sustainability & Investor Relations Officer at Bank of Ireland Group, commented: “This report details the progress we made last year across our environmental, social and governance (ESG) priorities. We have firmly moved from ambition to action, taking real steps to support our customers and the Group towards a more sustainable way of living and doing business.”

“In 2022, there was a significant increase in the level of sustainability-related lending across the Group, with Irish green mortgages a particular standout growing from €1.8 billion in 2021 to €3.8 billion. We’ve reached an important inflection point, with around half of new mortgages in Ireland being green.”

“ESG is firmly embedded in Bank of Ireland’s refreshed strategy for the next three years. Through this strategy, our focus will be on offering customer-focused solutions and supports for some of the most critical challenges facing society today providing innovative new products to help finance the transition. Our aim is to help accelerate the shift to a low carbon economy and scale action by providing the right finance where incremental investment is needed across key sectors of the economy. This includes setting sustainability-related finance targets of €15 billion in 2025 from c.€8 billion in 2022. We’re also adding to our successful partnerships in the dairy farming and forestry sectors through a new partnership with one of Ireland’s leading retailers, Musgraves. This aims to meaningfully reduce carbon across Ireland’s retail footprint.”

“Our progress in 2022 was not just restricted to the “E”. “The ‘S’ and ‘G’ are critical legs of our ESG strategy. We continue to drive forward our financial wellbeing agenda, and foster a collaborative and inclusive environment for colleagues. This is because our core sustainability pillars – supporting the green transition, enhancing financial wellbeing, and enabling colleagues to thrive – are all intrinsically linked.”

“As the demands for greater transparency and accountability for achieving sustainability targets continues to grow, we have stepped up to meet these requirements. We have grown our in-house sustainability team and expertise across the Group. 2022 also saw the creation of a Group Sustainability Committee at board level. We have also extensively expanded our sustainability-related disclosures following the publication of our inaugural report last year which has contributed to improved ESG rating agency scores from Sustainalytics, S&P Global and MSCI. Publication of our 2022 Sustainability report escalates our disclosures for all stakeholders even further.”

Supporting the Green Transition

The report outlines how Bank of Ireland is supporting customers in the green transition, and has aligned its climate transition targets to internationally-validated science and policy. Bank of Ireland is the first Irish bank to set scientifically-validated targets for reducing greenhouse gas emissions, covering 76% of the loan book and all of the Group’s own operations. In this context, it has also published a target to grow sustainability-related lending on its balance sheet from c.€8 billion in 2022 to €15bn in 2025 and €30bn by 2030. This will see the Group drive a partnership model with customers.

A new Bank of Ireland partnership with Musgrave Group is helping its Supervalu and Centra retail partners fund sustainability initiatives. During 2022, Bank of Ireland financed the upgrade of the refrigeration system at Quish Group’s SuperValu store in Ballincollig, Co. Cork. Following the upgrade, the store’s energy consumption reduced by 27%, cutting costs and reducing its carbon footprint. Bank of Ireland is now financing a full revamp of Quish Group’s Supervalu outlet in Tramore which includes an upgrade of the refrigeration system as well as roof insulation and the installation of solar panels.

  • Green mortgages accounted for c.50% of total RoI mortgage lending last year.
  • €1.3 billion in green bonds issued during 2022 which, with a further €750 million of issuance in Q1 this year, brings total issuance to date to €3.25 billion.
  • Funding c740MW renewable wind generating capacity across the Island of Ireland.
  • c. €1.9 billion of lending commitments to corporate customers with sustainability-linked pricing (at end Dec. 2022).
  • €16.4m of green home improvement loans drawn down in 2022 (12% of total home improvement loans).
  • Bank of Ireland is the largest provider of wholesale finance for electric vehicles in RoI, providing finance to 13 of the 15 car manufacturer franchises.
  • Decarbonising Bank of Ireland’s own operations, reducing absolute emissions by 41% vs 2020 (89% vs 2011), supported by key initiatives including switching remaining sites to renewable energy contracts and further LED lighting upgrades. €11.5 million investment in branch network this year will include installation of LED lighting.
  • In 2022, Bank of Ireland took a number of actions to look at its impacts on nature, including being the first Irish Bank to join the UNPRB Biodiversity Target Setting working group and the Taskforce for Nature Related Financial Disclosures (TNFD) Forum.

Enhancing Financial Wellbeing

In 2022, we continued to develop our Financial Wellbeing programme, launched in 2019, which focuses on improving people’s financial literacy, capability and confidence. Bank of Ireland retains its position as #1 for Financial Wellbeing in Ireland.

Financial capability:

  • Financial Wellbeing Index score for Bank of Ireland customers is 2 points above the national average.
  • Collaborated in a research project with the CCPC and ESRI on how to encourage consumers to build a savings buffer. The CCPC has used the findings to develop a guide for financial providers on encouraging saving habits and improving the financial wellbeing of their customers.
  • Financial literacy programmes for Irish primary and secondary schools, delivered to over 418,000 students since its launch.
  • Recently published research on Financial Literacy Score for Ireland, at 54%, which trails in comparison to international peers.

Financial inclusion:

  • In 2022, the bank built on its position as first Irish bank to be a founding signatory of the UNPRB ‘Commitment to Financial Health and Inclusion’ becoming co-lead of the working group taking a leadership role in accelerating action for universal financial inclusion and financial health.
  • Established a specialist mobile team who attended large accommodation centres, mostly on weekends, to open accounts for Ukrainian refugees. The Bank also employed over 35 Ukrainian staff in key parts of the network to overcome translation barriers in branches.

Financial confidence

  • Our new in-app digital money management tool Mi365 delivers 40+ personalised spending insights and tailored nudges to help customers review spending patterns, make better financial decisions, adapt their behaviours and habits to pursue their financial goals.
  • Launched a ‘Check Your Text’ service to help protect our customers against fake SMS text messages that appear to come from Bank of Ireland. Customers can verify a text in 60 seconds.

Enabling Colleagues to Thrive

  • New or enhanced people policies including paid menopause leave, supports to colleagues who may be experiencing domestic abuse, and tripling paid paternity leave.
  • 34% of colleagues undertaking digital skills training (All-Colleague pathways) in areas identified as priorities by the Group’s skills assessment (+11 percentage points year-on-year).
  • Almost 500 women currently participating in RISE, Accelerate and Emerge programmes to progress their careers and increase the representation of women at senior levels.
  • Percentage of female senior leadership appointments was 40% for 2022 and rose to 53% in Q4 2022. The Bank remains committed to achieving a 50:50 ratio.

To view Bank of Ireland’s Sustainability Report for 2022 visit here.