The current state of Irish banking is a consumer nightmare
Competition in the Irish banking market will soon be almost non-existent, according to Social Democrats co-leader, and Finance Spokesperson, Róisín Shortall.
“KBC has today confirmed its intention to quit the Irish market. This news will be a source of great alarm to both its staff and customers and they must be kept fully informed of the bank’s plans at every stage. Every effort must be made to protect jobs and customers to the fullest extent possible.
“This unwelcome development means competition in the Irish banking market will soon be almost non-existent. It comes just weeks after Ulster Bank, the State’s third largest bank, announced its intention to abandon the Irish market.
“Ireland already has among the highest mortgage interest rates in the euro zone, second only to Greece. According to Brokers Ireland, this costs an Irish mortgage holder with a €300,000 loan over 30 years, in excess of €82,000. When consumers are denied choice, prices rise and AIB and Bank of Ireland will soon have the market, substantially, to themselves.
“Finance Minister Paschal Donohoe said he found out about KBC’s proposed exit when he received a call from the CEOs of KBC and Bank of Ireland at 9pm last night to advise him the banks had entered into a Memorandum of Understanding to sell KBC’s performing loans to AIB. It is concerning that the Minister was apparently among the last to know of the banks’ plans, given their serious implications for both staff and consumers.
“Bank of Ireland CEO Francesca McDonagh said the proposed deal with KBC complements its strategy to increase its business in Ireland. Meanwhile, AIB entered into a similar deal with Ulster Bank when it announced its intention to leave. While it may be in those banks interests to increase their business by gobbling up competitors’ loan books, that is not in the interests of the Irish public.
“Following the exit of Ulster Bank, the government spoke in vague terms about creating a third force in Irish banking. Those plans need to be fleshed out immediately. The current state of Irish banking is a consumer nightmare.
April 16, 2021
Ends