Why these are not good times for banking and finance in Ireland

AIB can also be buying a bit of Ulster Financial institution’s mortgage e book which is additional eroding competitors. 

Then we get the information that AIB has taken over an unbiased stockbroking agency thereby creating additional focus within the general market. 

This was shortly adopted up with revelations about Davy Stockbrokers. 

Then to prime all of it Financial institution of Eire introduced that it’s closing 88 of its branches within the Republic.

The Financial institution of Eire chief govt justified this based mostly on a lot decrease footfall within the branches due to digitisation; there may be fact on this justification as increasingly more persons are shifting on-line. 

As an observer and person of the Irish banking system it strikes me that for the previous decade the one technique that the Irish banks have is predicated on cost-cutting by means of department closures and workers reductions. 

One can definitely query if a sustainable long-term enterprise mannequin may be profitable by simply concentrating on chopping prices and ignoring customer support and small enterprise relationships.

The general public will more and more face right into a banking system with fewer shops, fewer and fewer certified workers, and a severe diminution of the idea of customer support. 

The notion of relationship banking is now an archaic idea. We’re being pushed into on-line banking, which might be effective if the IT platforms had been ample, and if broadband of ample high quality is accessible.

As well as one ought to spare a thought for our older technology who could not really feel snug or assured sufficient to transact banking on-line. 

Spare a thought additionally for these of us who like to choose up the telephone or drop into our native department to debate our banking points with someone we all know and who may care. 

Coping with a financial institution is now an identical expertise as coping with a telecoms firm, and that by any stretch of the creativeness, is just not a nice expertise.

The closure of branches will additional harm already poor customer support and additional harm competitors out there and can impression our cities and villages. 

The integrity of Irish cities and villages has been underneath severe assault for some years with submit workplace closures, financial institution department closures, and retail closures. Covid-19 will simply serve to exacerbate these pressures on cities and villages.

I’ve been accused of being an old style dinosaur and informed to get with the occasions and transfer on from an unsustainable banking mannequin. 

Possibly I’m old style, and a dinosaur, however I imagine that in relation to one thing as essentially essential as one’s funds, customer support and relationships do matter.

The latest bulletins by Ulster Financial institution and Financial institution of Eire ought to encourage our policymakers to assume outdoors the field, if that’s attainable, and take into account different banking constructions. 

I’ve up to now spoken about creating one thing out of the Publish Workplace community, the Credit score Union motion, and PTSB, of which the Irish taxpayer owns a big chunk. 

It might create extra competitors for the incumbent giants, present banking providers to SMEs and fewer well-off clients, and never be pushed primarily by shareholder worth and profitability.

I believe that you will need to reiterate the purpose that the way in which our banking system is evolving in a method that might be detrimental to our already pressurised small enterprise sector. 

Bigger companies typically have few considerations as banks are delighted to service them, however for important smaller companies, this isn’t at all times the case and the state of affairs is prone to worsen. 

Our policymakers must assume lengthy and exhausting about this.

In the meantime, I by no means once more need to hear a banking establishment promoting based mostly on how essential buyer relationships are — or certainly stockbroking companies for that matter. 

That day is properly gone, and we’re all of the poorer for it.