Bank of Ireland changes ‘unnecessary’, Noonan says

Minister for Finance Michael Noonan has described restrictions to be imposed by Bank of Ireland on over-the-counter lodgements and withdrawals as both "surprising and unnecessary".

Mr Noonan said the changes, which will block bank staff from handling withdrawals of less than €700 and lodgements of less than €3,000, was “a commercial decision for the bank”.

He noted the bank’s commitment to assist more “vulnerable customers” in its branches.

"I expect the bank to fully honour this commitment and ensure that customers will be facilitated through the existing arrangements where required. I would welcome a clarification form Bank of Ireland on the issue," he said in a statement.

In response to the Minister’s statement, the bank appeared to soften its stance and said “vulnerable customers, together with those elderly customers who are not comfortable using self-service channels or other technology solutions, will be assisted by branch staff to use the available in-branch services”.

Under new rules, designed to streamline in-branch services, Bank of Ireland said withdrawals of less than €700 will no longer be facilitated with the assistance of tellers.

From mid-November, customers will have to use ATMs or mobile devices for small and modest-sized withdrawals.

Lodgements of up to €3,000 and those involving less than 15 cheques will also have to use the bank’s dedicated lodgement ATMs.

The bank said payments, lodgements and withdrawals in excess of these amounts would be dealt with by staff in branches. The changes will also see the daily withdrawal limit on cards increased to €1,300.

“Bank of Ireland understands these changes may be a new way of banking for some of our customers, and the branch teams will be available to help and guide them through this change,” the bank said in a statement.

In response to the Minister’s statement, the bank appeared to soften its stance and said “vulnerable customers, together with those elderly customers who are not comfortable using self-service channels or other technology solutions, will be assisted by branch staff to use the available in-branch services”.

It said over-the-counter business and personal transactions last year made up only 4 per cent of total transactions with customers increasingly choosing to use in-branch devices or the bank’s digital channels.

However, advocacy group for the elderly Age Action accused the bank of ignoring the needs of its older customers .

“Many of our members are already frustrated with how difficult some banks make it to engage face-to-face,” Age Action’s JustinMoran said.

“The changes proposed by Bank of Ireland, trying to force people to carry out their business online, are only going to make that worse and it’s clear older people were completely ignored in making this decision,” he said.

The Irish Farmers’ Association (IFA) said the changes would cause great difficulty for some farmers who are not familiar with the bank’s online system, and urged the bank to reconsider the new thresholds.

In a trading update, released separately this morning, Bank of Ireland said it continues to trade in line with expectations with good momentum across its businesses in Ireland and elsewhere.

“The macroeconomic environment and outlook in Ireland and the UK, which are our key markets, continue to be favourable,” the bank said in a trading update this morning.

The bank said its net interest income had benefitted from lower funding costs and the positive impact of new lending in the third quarter.

The bank’s net interest margin averaged 2.18 per cent in the three-month period.

It said its defaulted loan volumes had fallen by €800 million to €12.5 billion in the three months to the end of September, with reductions across all asset classes.

“These reductions reflect our ongoing progress with resolution strategies that include appropriate and sustainable support to customers who are in financial difficulty, the improving economic background and the ongoing recovery in collateral values,” the bank said.

It said it expected the level of defaulted loans to continue to reduce.

The bank said new lending was growing in line with expectations with increasing demand for credit in Ireland.

Bank of Ireland said its UK arm continues to grow, benefitting from strategic partnerships with and through the Post Office.

The bank said the weaker euro was supporting Irish exports while consumer spending and investment were benefiting from improving labour market.

In the UK, it noted consumer spending was benefitting from lower unemployment and a pick-up in earnings growth.