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Q&A: I am an Ulster Bank customer

Ulster Bank confirmed its exit from the Irish market this morning after more than 160 years. We asked Daragh Cassidy of what this means for the bank’s 1.1 million customers in the Republic.

Ulster Bank has confirmed its exit from the Irish market and its gradual liquidation over several years, around six. So there is no need for anyone to panic or start looking to move accounts immediately. NatWest is well capitalized, well managed and the Central Bank will ensure that clients are protected as much as possible.

However, current account customers will eventually need to find a new bank to deal with.

The good news is that there are currently nine other current account providers in Ireland, so there has never been more choice and opening a new account has never been easier. KBC, N26 and Revolut allow you to do this from the comfort of your home through their mobile apps, while AIB and BOI have also significantly streamlined their processes in recent years.

Think carefully about what you value in a checking account. Do you just want the one with the least cost, or are things like mobile payments, an app, access to an agency network, and reward programs also important? Do you need an overdraft?

There may also be some type of campaign among existing vendors for your business. This is what happened when Halifax exited the market in 2010 and when Dankse closed its retail operations in 2013 and the PTSB attempted to court their business.

I have an Ulster Bank savings account – is my money safe?

Your money is absolutely safe. The only problem is deciding where to put your savings.

As custody of customer deposits now costs banks money, most banks are likely to accept further savings, so it will be interesting to see how the industry manages billions of dollars in research savings. new accommodation.

Unfortunately, the closure of Ulster Bank could accelerate the arrival of negative interest rates on customer deposits.

Perhaps now is the time for savers to consider investment options instead, depending on their risk appetite. Paying off debts and supplementing pensions are other good alternatives for people’s savings.

Ulster Bank is expected to leave the Irish market tomorrow after more than 160 years. We asked Daragh Cassidy of what this means for the bank’s 1.1 million customers in the Republic.

I have a mortgage with Ulster Bank – how does this affect me?

If you are a client of a mortgage or personal loan, it is likely that your loan will be sold to a competing lender already active in Ireland or perhaps a new brand lender. However, for competitive reasons, it is unlikely that any of the biggest players in the market like AIB and BOI will be able to compete for the company.

Your repayment terms and interest rate will all stay the same, and customers won’t have much to do or worry about. While this can be an opportune time for mortgage holders to see if there is better value to be obtained by switching to a new lender of their choice.

Those with a follow-up mortgage will still be able to keep it, and if you’re lucky enough to have one, you won’t find better value anywhere else.

This is also the possibility that Ulster Bank will continue to hold your mortgage and personal loan after it has closed in Ireland, but outsource the day-to-day management of your loan (statements, customer service, payment services, balance inquiries. , etc.) to a specialized service provider. This is what happened when the former Irish Nationwide (then Danske Bank) closed its retail operations in Ireland in 2013 and chose Pepper to handle the bulk of its loans, despite having also sold some of his loans to Pepper.

There is talk of selling mortgages to vulture funds – should I be concerned?

No. These funds have a bad reputation in Ireland, in part because of the tabloids and politicians who advertise and do not understand what they are really doing.

A vulture fund is simply a business that invests primarily in debt that is considered very low or in default. Your rights and obligations as a mortgage holder with a vulture fund are no different from any other Irish bank or lender and you will enjoy the same protections as everyone else under the Consumer Protection Code of the Central Bank.

What could this mean for longer term clients?

If Ulster Bank were to choose the nuclear option to leave Ireland, it would be a blow to consumers and competition in the banking industry and put enormous upward pressure on interest rates and bank charges at least in the short and medium term.

Ireland is already underbanked compared to other countries our size, so the last thing we need is for the third biggest player to leave the market and reduce competition even further.

Ulster Bank’s exit would be felt more severely in the SME lending sector where it is the only real competition for BOI and AIB. Mortgage creditors and customers of personal checking accounts and loans will also be affected.