Mr. Frank Jansen:

I am grateful to the Chairman and members for this opportunity to address the committee. I am accompanied today by my colleagues, Mr. Barry D’Arcy, executive director and KBC Ireland's chief risk officer; and by Mr. Darragh Lennon, director of retail distribution.

We look forward to a constructive discussion on the migration of current accounts as KBC exits the Irish market. It is our intention to be as comprehensive as possible in answering the committee's questions, while fully respecting commercially sensitive information and the boundaries set by the regulatory and ministerial approval process for the transaction with Bank of Ireland.

We understand the crucial importance of a current account in the financial daily lives of our customers. We also understand that changing banks involves time and effort on behalf of customers and it is our intention to support them through that process. We are fully aware of the apprehension about the volume of customers that will seek to open new current accounts and the challenges that presents to the market. We are determined to meet our responsibilities and to minimise to the greatest extent possible the inconvenience caused to our customers.

It might help to provide additional clarity on the number of KBC accounts involved in wider current account migration process, the KBC part of which we expect to be concluded in approximately 14 months, prior to our departure from Ireland. KBC entered the current account market relatively recently, in 2013, which is reflected in KBC hosting a low volume of current accounts. Based on data analysis, we estimate of the 130,000 total current account holders, approximately 52,000 will need to open new accounts or move to new providers. The other 78,000 account holders already have an account with another provider. Of those 52,000 customers, in the region of 97% are digitally active, which should support the migration process and make it easier and more convenient.

Of the 52,000 account holders who will need to move to new providers, fewer than 100 are categorised as vulnerable. They will be separated from the general customer group and provided with a bespoke engagement strategy. This engagement will include more intensive outreach and one-to-one support. We will have a dedicated vulnerable customer phone line and appoint a dedicated vulnerable customer team to meet these customers' specific needs on a case-by-case basis, including empowering the team to make decisions about accommodating any additional needs. The team will work closely with vulnerable customers through the closure process to make sure they understand what action is needed and to offer every support and assistance. Vulnerable customers will also be provided with additional time if it is required to complete actions or close their current accounts if they are unable to do so by the proposed closure date.

In summary, the account closure process will be managed in the following way. Every customer will receive six months' notice of account closure. From 1 June, formal closure notices will begin to issue to specific customer groups on a phased basis, throughout 2022 and early 2023, extending over a 14-month period. Communication will be in plain English, and all technical terms will be clearly explained. It will be made clear to customers who they should contact and how they can contact KBC throughout the process. We will outline any potential impact on customers and explain clearly the actions they are required to take. We will continue to communicate with customers regularly. This will be supported by advertising in relevant media to ensure ongoing awareness of the process.

We have increased our staff dedicated to servicing customers in our contact centre by 40% to ensure that we maintain strong service levels to our customers, including, as I mentioned, creating a dedicated vulnerable customer support team. Additionally, we are increasing staff numbers in our operations department by 20% to meet the expected demand arising from switching and current account closures. We will adjust staff deployment as required and we are confident that our staffing levels will meet expected demand, but we will monitor this and are ready to deploy more staff if needed.

It is important to underline that our business model is such that the vast majority of customers engage with us through our contact centre. Some 90% of customer servicing is done through this me channel and we have made sure and continue to make sure we have the right resources to keep customer service levels high. Our average customer waiting time until we pick up the phone is just 21 seconds in 2022, so customers can have direct contact with our colleagues. Our hubs are also used by a small number of our customers for support and we will continue to review how our customers are using our hubs as we move through the process and we will keep these open as long as that support is needed for a substantial number of our customers.

To further assist customers, KBC will not charge current account maintenance fees from the point at which we commence issuing closure notices in June. This will apply to all customers. The purpose of no current account maintenance fees is to provide customers with flexibility so they can open a second current account without incremental costs with another provider. It will allow them time to switch incoming and outgoing recurring payments from one account to another, at their own pace and at the pace of the payment providers.

Our intention is to take a flexible approach that will ensure that people are supported at every turn throughout this process. I wish to reiterate our very strong commitment to continued support and responsibility for our customers, colleagues, communities and all stakeholders in society. Our exit will be carried out in an orderly and responsible manner, fully respecting all the obligations we hold. I acknowledge and thank all our staff, who continue to provide excellent service and support to our customers through what is a challenging time for them too. They continue to go above and beyond every day and we are extremely grateful for their continued commitment and support.

Even if our customers are required to close their account with us and open a new one, they are still our customers until they are not. Our intention is to take care of them to the greatest extent possible. Our mission is to support them and communicate comprehensively with them, ensuring they have the information they need, understand the actions they need to take and have sufficient time to take those actions. We are ensuring customers do not incur current account maintenance fees, providing support to those most vulnerable and redeploying staff to support all customers, including the 52,000 who we estimate will have to open new accounts. We are doing and will continue to do all that we can for our customers.