KBC and Ulster Bank should not be allowed to announce their formal exit from Ireland until they have satisfied the Central Bank that they have met regulatory requirements around the issues.
That is according to the Financial Services Union (FSU), which today discussed the matter during a meeting with the Minister of State at the Department of Finance, Sean Fleming.
"The Minister confirmed he is aware of current operational issues with banks and noted the Central Bank release of a report on poor service levels in branches and on telephone banking," said John O'Connell, general secretary of the FSU.
"Over a million customers will have to transfer their accounts with many vulnerable people facing a traumatic time with little assistance forthcoming from the banks."
"It is clear the sector is not equipped presently to deal with all the issues that will undoubtably flow from the decision by Ulster Bank and KBC to leave the Irish banking market."
The union claimed the FSU and Competition and Consumer Protection Commission should be intervening and setting realistic timeframes for the withdrawal of the two banks because of the current "turmoil" in the sector.
Ulster Bank said recently it would be contacting customers shortly to inform them that they should begin the process of finding a new home for their accounts.
However, anecdotally customers seeking new banks are reporting long wait times and poor service as they try to start the switching process.
"Any announcement on departure dates should be delayed until the Central Bank is satisfied that the banks have met the regulators set requirements," Mr O’Connell said.
He added that banks and the Central Bank should be called to appear before the Oireachtas finance committee to explain their exit plans.
"Legislators need to be aware of the profound consequences to the banking sector if this change to the sector is not managed correctly," he said.
Recent research by the Central Bank found many customers were being forced to wait long periods of time when they called their banks, with some having to wait up to two hours before the spoke to someone.
