Ulster Bank to start freezing accounts this week

Ulster Bank will start freezing customer accounts from Friday, despite recent concerns expressed by Central Bank governor Gabriel Makhlouf.

The bank confirmed on Tuesday that customers who were notified back in April that they had six months to move their accounts will start to see those accounts frozen from the end of this week. The accounts affected will be formally closed 30 days later, the bank said, unless customers get in touch and seek an extension.

Both current and deposit accounts are affected. Once closed, the bank said it would send cheques for any outstanding net balance to the last known address of accountholders.

Ulster Bank said it will focus first on accounts that are inactive or where there are fewer than five transactions a month. Deposit accounts, which generally have very few transactions in a month are likely to find themselves in the front line for this first wave of closures. It said it had chosen those accounts as the bank believed those customers were less reliant on those accounts or likely had accounts elsewhere.

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Current accounts that have seen six or more transactions in the past month will not be frozen, the bank said. Nor will any account that has had a welfare payment lodged in that time, with the bank referring to these as “high reliance” accounts.

Accounts in receipt of a lodgement of €125 or more will also escape the cull for now, even if there are five or fewer transaction on the account in the 30 days. The bank said this had been decided as such sums could be customers’ wages.

Finally, it said that business current accounts that had seen turnover in excess of €1,000 over the past month and relied on an overdraft would also be excluded.

Ulster Bank said it was encouraging customers who have not yet taken action to begin the process to choose a new provider, move their transactions and close their current and deposit accounts within their notice period. However, it is unlikely anyone targeted in this first wave of closure will have the time to act before their existing account is frozen.

It said that more than 70 per cent of its personal current account customers who had received their first formal six-month closure notification in April and May had either closed, “materially wound down the level of activity in their current account or left it inactive”.

But the bank said it would pause its freezing of accounts between December 9th and January 6th to ensure people do not find their accounts frozen over Christmas.

[ Ulster Bank deposits drop €9.1bn in first nine months of 2021 amid ‘big switch’ ]

Jane Howard, the bank’s chief executive, said Ulster Bank had adopted a “careful and controlled approach means that where a customer is still reliant on the current account we can and will support them to move to a new banking provider”.

“We are starting our freezing and closure process very carefully,” she said, but she warned: “While we will continue to reach out to customers who are still using their account, unless a customer engages with us to change the date, their account will enter the freezing and closure process on or after their original date.”

The bank also reminded customers that 25 of its branches will close in the early weeks of January before reopening as Permanent TSB branches. Many customers at those branches will not yet have reached the end of their six-month window to switch accounts, which may cause logistical issues for customers.

The branches affected are: Ardee, Athenry, Ballyjamesduff, Ballybofey, Blackrock, Ballyconnell, Blanchardstown village, Belmullet, Celbridge, Buncrana, Enniscorthy, Donegal, Kilcock, Eyre Square, Lucan, Killybegs, Ranelagh, Shannon, Rochestown Avenue, Thurles, Swords Pavilions, Tuam, Trim, Westport and Wilton.