Thousands of banking jobs at risk, union warns

THREE IRISH-OWNED banks will disappear and thousands of jobs will be lost as a result of upheaval in the finance sector, the largest finance union said yesterday.

The Irish Bank Officials’ Organisation (IBOA) called on the Government to continue investing in the banks and to ensure all lay-offs in the sector were made on a voluntary basis.

Larry Broderick, the IBOA general secretary, said the next phase in the continuing turmoil would be consolidation.

He expects just three Irish-owned institutions – AIB, Bank of Ireland and EBS – to remain standing at the end, with Anglo Irish Bank and Irish Nationwide to wind down. Mr Broderick believes Irish Life Permanent will re-emerge broadly as an insurance business with a mortgage wing. He expects EBS to be maintained as a mutual institution.

Mr Broderick pointed to the State’s National Asset Management Agency (Nama) as the catalyst for the shift.

He argues that after Nama takes on the bad development and other loans from banks, some institutions will have very little remaining. The “commonality” of some bad loans, whereby different banks historically lent to the same developer, will speed the process of consolidation along, he believes.

The IBOA is pushing for Government policy on the banks to focus on the future rather than the present. “Decisions are being made short term. There is no discussion about what the medium term will be,” said Mr Broderick.

Once the “impaired loans” have been addressed, foreign buyers could enter the market to buy up what remains of Irish banking, according to Mr Broderick.

He named Spanish institution Santander as a possible buyer for AIB or Bank of Ireland within three to five years, predicting that the overall process of change would lead to “thousands of job losses”. Job insecurity will be compounded by internal restructurings within the remaining Irish-owned banks, he said.

“We need to address this issue now,” said Mr Broderick. AIB and Bank of Ireland both have about 15,000 staff. Irish Life Permanent has about 4,000 while Anglo Irish has 1,500. Some 1,000 work at EBS while Irish Nationwide has about 600 staff.