CMA letter to AIB NI on a breach of Directions given under the SME Banking Undertakings
Letter to AIB NI for non-compliance with Directions given under the Small and Medium sized Enterprises (SME) Banking Undertakings 2002.
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AIB NI breached the Directions given to it under the Small and Medium-sized Enterprises Banking Behavioural Undertakings. In 2002, AIB NI undertook not to require customers to open and maintain a Business Current Account (BCA) as a condition of receiving, servicing or maintaining a loan or savings account, a process known as ‘bundling’.
Following an investigation in 2014, the CMA concluded that AIB NI had breached the undertakings by bundling products for 11 SME customers. As a result, the CMA issued it with written directions designed to improve its compliance with the undertakings.
Between December 2019 and August 2020, AIB NI had failed to comply with the direction to include wording in its Business Lending Policy not to require SME customers to open or maintain a BCA in order to open or maintain a business loan or business savings account.
AIB NI will ensure that a similar breach will not happen again through undertaking a review of its credit policies to ensure all relevant regulatory obligations are properly captured.