As the tectonic plates of retail lending began slowly settling into new formations, other new seismic rumbles came along to cause more than a few challenges and changes.
Central Bank research raised concerns about unacceptably long customer call waiting times, revealing an apparent deficit in staffing in key areas like account opening and other customer services in the receiving banks. Bit by bit the banks began to act, recruiting hundreds of staff, commencing marketing campaigns, coordinating activities through the Central Bank and their own industry body, Banking and Payments Federation Ireland.
But they’ve also benefited from ongoing progress around the purchase of assets from Ulster Bank and KBC, which has also begun to deliver an influx of new customers. CCPC and ministerial approval also came for Bank of Ireland’s purchase of KBC’s performing loans and deposits, subject to certain conditions and commitments.
AIB was first to break ranks, but others have followed suit with a flurry of rate changes, mostly just to new fixed rate mortgages and trackers, as would be normal. But while the cost of borrowing has increased during 2022, the Central Bank threw a short and thin lifeline to borrowers by tweaking its mortgage lending rules.
At AIB, on the other hand, progress has been a little slower, but has gathered pace towards the second half of the year.But a trading plan, a share buyback and a series of placings saw that whittled down to its current level of 57%, raising hundreds of millions of euros for the exchequer along the way.Meanwhile, over at Permanent TSB the Minister’s shareholding reduced from 75% to 62.
The completion of the Department of Finance’s Retail Banking Review, which recommended easing the rules, gave the departing minister Paschal Donohoe the political cover needed to deal with the thorny issue though, prior to the cabinet reshuffle and Michael McGrath’s arrival. It had announced plans to cut cash services from 70 branches around the country because of reduced demand for physical money.