Written answers

Thursday, 16 June 2022

Photo of Brendan SmithBrendan Smith (Cavan-Monaghan, Fianna Fail)
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48. To ask the Minister for Finance if he has had recent discussions with the Central Bank in relation to the difficulties facing customers transferring accounts from banks (details supplied) to other retail banks; and if he will make a statement on the matter. [31295/22]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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I am in regular contact with the Central Bank of Ireland on a range of matters and my officials also meet regularly with the Central Bank to discuss relevant matters regarding the withdrawal of Ulster Bank and KBC from the Irish market.

I would note that the decision of Ulster Bank and KBC to leave the Irish market is regrettable and my focus is on ensuring an orderly withdrawal and minimising the disruption to impacted consumers.

The Central Bank has been clear that it expects all retail banks, both those exiting the market and those remaining, to have plans in place to manage the impact of the broader changes and consolidation in the retail banking sector in Ireland. It is the responsibility of the individual banks to ensure that they are putting their customer first, ensuring fair treatment of customers and that customers understand what the changes mean for them.

The Central Bank met with the CEOs of the five main retail banks in Ireland on 17 May 2022 to discuss the large scale migration of customer bank accounts, and the actions necessary to ensure that this activity happens in line with customer needs and expectations. Following the meeting, there was agreement that a strong customer focused approach needs to be delivered. In order to achieve this objective, more work is required in the following areas:

- Better planning – the need for the sector to collaborate on a collective approach with agreed timelines and joined up planning across all institutions.

- Customer focused arrangements –taking into account the specific circumstances a customer may face and strongly supporting them in making the move.

- Proactive communication –so that customers can understand the banks processes, including how and when key customer facing decisions will be made.

- System wide engagement – the need for an inclusive forum where the banks engage as a group with the other actors and stakeholders in a way that is purposeful and enables problems to be anticipated and solved.

The Central Bank will meet again with the CEOs on 28 June 2022 for a further update on progress of the migration of customer accounts.

Photo of Brendan SmithBrendan Smith (Cavan-Monaghan, Fianna Fail)
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49. To ask the Minister for Finance his views on the need to extend the timeline for banks (details supplied) exiting this State; and if he will make a statement on the matter. [31296/22]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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While it is regrettable that Ulster Bank and KBC have decided to exit the market, as Minister for Finance, I do not have a role in the day to day operations of any bank operating within the State. Decisions in this regard are commercial matters and are the sole responsibility of the board and management of the banks, which must be run on an independent and commercial basis.

My priority now is that the withdrawals take place in an orderly manner and the importance of this is emphasised in all engagements with Ulster Bank and KBC. Both banks are meeting with officials and providing relevant information regarding account closures to the Department of Finance on a monthly basis. This will help to identify any emerging trends and potential issues for consumers.

Both banks have indicated that they will provide customers with six months' notice to close their accounts and that will be issuing letters to customers in tranches over the coming year.

Section 3.11 of the Central Bank's Consumer Protection Code requires that where a regulated entity intends to cease operating, merge with another, or to transfer all or part of its regulated activities to another regulated entity it must:

a) notify the Central Bank immediately;

b) provide at least two months notice to affected consumers to enable them to make alternative arrangements;

c) ensure all outstanding business is properly completed prior to the transfer, merger or cessation of operations or, alternatively in the case of a transfer or merger, inform the consumer of how continuity of service will be provided following the transfer or merger; and

d) in the case of a merger or transfer of regulated activities, inform the consumer that their details are being transferred to the other regulated entity, if that is the case.

As part of its supervisory programme on retail bank consolidation, the Central Bank met with the CEOs of the five main retail banks in Ireland on 17 May 2022 to discuss the large scale migration of customer bank accounts, and the actions necessary to ensure that this activity happens in line with customer needs and expectations. The Central Bank will meet again with the CEOs on 28 June 2022 for a further update on progress of the migration of customer accounts.

My officials and I will continue to monitor the migration of current accounts from the exiting banks and engage with relevant stakeholders, both public and private, as I have been doing over recent months. With the objective of ensuring that impacted customers face the least amount of disruption in migrating their accounts over the coming months.

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