Brian Hayes (Dublin South West, Fine Gael) | Oireachtas source

I thank Senator O'Donovan, the Leas-Chathaoirleach, for raising this matter. As the Senator will be aware, and notwithstanding the fact the State is the significant shareholder in AIB, the Government must ensure the bank is run on a commercial, cost-effective and independent basis so as to maintain the value of the bank as an asset to the State, as per the memorandum on economic and financial policies agreed with the European Commission, the ECB and the IMF. A relationship framework has been specified which defines the nature of the relationship between the Minister for Finance and the bank. This framework stipulates that the Minister has no role in the commercial decisions of the bank, with these decisions remaining the responsibility of the board and management of the institution.

As the Government has stated and the Senator will appreciate, it is an inevitable, but unfortunate consequence of the necessary restructuring of the banking system and the return to viability of the sector that branches in certain towns and villages will be closed. The Government appreciates that branch closures will have an impact on those towns and villages, but the Department has been informed by AIB that the bank is working very closely with its customers to ensure the disruption is minimised and to provide a range of alternative banking options to affected customers, such as use of local post offices and mobile banking facilities.

As part of AIB's restructuring plan to return the bank to profitability and to reduce dependence on State support, significant cost reductions are required over the coming years. In this regard, AIB announced its branch rationalisation programme in July 2012. The bank's branch overhaul will include a combination of six amalgamations, 16 full branch closures and 45 sub-office closures. In total, 67 locations will be impacted, equating to 27% of AIB's branch network. It is worth noting that AIB will still have 200 branches in Ireland following the rationalisation, coupled with an additional 80 EBS outlets.

Nevertheless, to mitigate the impact of the branch closures on customers, AIB intends to strengthen its long-standing relationship with An Post and, at the same time, is launching a new mobile bank service to provide certain banking services to customers in remote locations. The mobile service will allow customers to make lodgements and withdrawals, pay bills and order foreign exchange. At the moment, AIB banking services are available in more than 1,100 An Post outlets nationwide. The current services at any An Post outlet allow AIB customers to make cash lodgments for personal and business customers, avail of cash withdrawals up to ¤600 per day, pay their credit cards bills and use any of An Post's own branded services, including bill payments, postal drafts and foreign currency.

In addition, AIB plans to build on this successful relationship with An Post and has arranged for additional banking facilities to be available in more than 90 selected outlets. AIB and An Post management are working closely together at local, regional and national level to ensure the successful launch of this enhanced service, and An Post staff will be fully trained to offer this new service in advance of the branch closure dates.

As part of the closure process, the bank is also engaging extensively with customers, businesses and community groups in affected areas to ensure there is an adequate understanding about the rationalisation process. It is endeavouring to keep all stakeholders fully informed to minimise any inconvenience.

Specifically in rural areas in Cork such as Mizen Head, I am informed that customers will be able to access enhanced banking services at post offices in Ballydehob and Schull, while AIB is also exploring the possibility with An Post of offering additional services in Goleen. I am sure the former Deputy will be delighted to hear that. The mobile bank service will also be available in both Ballydehob and Schull three days a week, on Monday, Thursday and Friday. There will still be 30 AIB branches remaining open in Cork, with some within ten and 15 miles of Ballydehob and Schull, respectively.

Senator O'Donovan has made a very valid contribution and he is to be commended on putting forward the case for his own area..The fact that he has raised the matter in this public forum as a Member of the Oireachtas requires AIB to reply specifically to him and, in my view, this is what it should do in respect of the information the Senator has put on the record of the House. The argument about Schull has been well made by Senator O'Donovan and I think AIB has a responsibility to reply to him on that case.