THE CENTRAL BANK has called a meeting of Ireland’s leading banks to discuss how “more must be done” to support customers affected by the planned market exits of KBC Bank and Ulster Bank.
Banks have been told they must protect consumers, including assisting vulnerable customers, as many close their accounts and switch banks.
Both Ulster Bank and KBC are winding down their operations in Ireland, leaving Bank of Ireland, AIB and Permanent TSB to fill the void in a landscape that has been described as the “biggest logistical turnaround in Irish banking history”.
The Central Bank has identified that a “series of concerns” are emerging for customers who switch their accounts to a different provider.
Some of the key risk areas that banks have been told to mitigate include notice periods, the switch process, and “business decisions” that make it easier for customers to switch to a new bank.
The Central Bank has invited the chief executives of Ireland’s retail banks to a meeting on May 17 to “reinforce” their expectations of how banks should help customers.
In a statement, the Central Bank’s Director General for Financial Conduct, Derville Rowland, said: “Since the board announcements of the outgoing banks in February and April of last year, we have engaged intensively with the five banks to assess and manage the implications of the minutes”.
“We issued our first industry letter in June 2021, setting out our expectations for how consumers should be treated during this period of change and consolidation,” Rowland said.
As the process of closing bank accounts begins, it is imperative that outgoing and remaining banks demonstrate that they have sufficient plans, preparations and resources to meet our expectations.
“We are aggressively monitoring banks to ensure they are putting the interests of customers and prospects first throughout this unprecedented volume of account migration.”
Earlier this month, Ulster Bank gave its customers six months’ notice to switch their checking and deposit accounts to a new provider and close their existing accounts.
At the same time, KBC Bank announced that it will begin writing to its checking account customers gradually from June with a 90-day notice of change.
Rowland noted the “unprecedented scale involved” and that “bank staff are working extremely hard under difficult circumstances to provide customers with the services they need”.
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“We’re very aware of the impact on both staff and customers in that regard,” he said.
“But while the challenge of an exercise of this scale is recognised, it is also clear that in terms of banks’ overall plans, more needs to be done.”
Experts have advised affected customers to take action as soon as possible to avoid difficulties in finding a new bank, but not to panic.
speaking to The newspaperJPAC Director of Communications Grainne Griffin said customers need to think about what their banking requirements are.
“People really need to think about how important it is for them to have a branch that they can walk into. Do you have many direct debits and subscriptions? How much does it matter that they have the ability to cash a check? All those various things,” she said.
“It actually takes a little bit of work to get all of that under control.”