Ulster Bank is expected to defend its decision not to give advance warning of its plan to withdraw from the Irish market to staff at the Finance Committee today
In a written opening statement provided to the Oireachtas Committee on Finance, Public Expenditure and Reform, and Taoiseach ahead of this afternoon’s hearings, Financial Services Union (FSU) general secretary John O’Connell said staff and customers had been subject to abysmal treatment by the bank.
He said the union had met with Ulster Bank CEO Jane Howard on five occasions since September, when news of the review by NatWest of Ulster Bank’s operations emerged.
He said that on every occasion the bank refused to provide terms of reference of the review, who was conducting the review, or any update on its progress with staff and customers getting their information through the media instead.
Given the bank has signed a non-binding memorandum of understanding with AIB to sell it commercial loans, Mr O’Connell questioned whether anyone believes it credible for Ulster Bank to have adopted a position that no decision on the review was taken until last Thursday evening.
He also criticised NatWest for deciding last September not to engage with staff and their representatives and to not operate to good change management practices and agree a communication channel.
He claimed the group instead chose to add to the mental stress and anxiety of their staff, despite claims it cares passionately about their employee’s wellbeing.
Mr O’Connell also criticised the Central Bank, saying the outcome of the review was an indictment because of its failure to act.
“For months, there has been media reports on the failure of the bank to engage with key groups and for months consumers and staff looked to the regulator to take action,” he said.
“But the Central Bank can act now and give communities an assurance that no branch closures will be acceptable during the pandemic.”
The union boss also accused the two banks of putting pursuit of profit above all else.
“There is no doubt that NatWest and Ulster Bank management have failed their staff and customers,” he told the committee.
“Their deplorable behaviour over the last six months needs to be addressed at the highest level in Government and by the Central Bank. In its comments on Friday the regulator failed to highlight even once the poor treatment of staff. Not good enough.”
He said priorities need to be agreed around the withdrawal, including that jobs must follow the work to other institutions, that compulsory redundancies are not acceptable under any circumstances and that there should be no consideration of branch closures until the end of 2022 at the earliest.
“Agreeing these three issues would give certainty to staff and customers,” he said.He also reiterated the FSU’s call for a banking forum to be set up to examine the future of banking here.
Mr O’Connell told the committee that Ulster Bank said in a statement that there would be no compulsory redundancies.
However, he said 40 staff are fighting for their jobs and trying to stop NatWest and Ulster Bank from making them redundant.
He also said it was far from clear what the impact on colleagues in Northern Ireland would be with concerns over the future of 600 jobs in Ulster Bank’s Belfast office.
Senior management at Ulster Bank are also expected to tell the committee that there is a clear rationale for NatWest’s decision to wind down the bank, when they appear before it this afternoon.
In their draft opening statement seen by RTÉ News, representatives of the bank said that over the last ten years its strategy has been to improve returns by growing the business, reducing costs and resolving legacy issues.
But despite the progress made, it has become clear the bank is unable to generate sustainable returns over the long-term for shareholders, the draft statement continues.
The lender is also expected to defend its decision not to give advance warning of its plan to withdraw from the Irish market to staff.
According to the draft opening statement, until the NatWest board made a decision on Friday morning, there was no certainty as to the final outcome of the review.
It is expected the bank will accept that this situation, coupled with the ongoing media speculation and some of the communications issued to workers, added to the stress of the situation.
The management team is also set to explain how speculation that appeared in media in September about the bank’s future left it in the difficult situation of not being able to update staff because the review was underway, but the outcome uncertain.
It is expected to tell TDs and Senators that there was a requirement to conduct discussions in a manner that ensured commercial sensitivity and confidentiality, while in the latter stages of the review management were subject to additional restrictions until the board made a decision that could be publicly announced to the market.
The bank’s decision to decline to meet with the committee during the review was because the matters were, and in some cases still remain, commercially sensitive, the draft opening statement says.
The committee is also expected to hear that negotiations with AIB and Permanent TSB, along with other counterparties, on the potential sale of loans, may take many months to progress.
Ulster Bank management is also set to reiterate that there will be no immediate changes for staff and no new compulsory departures this year and that it does not intend to close any branches this year.
Customers will also be unaffected in the short term, according to the draft opening statement, with the bank set to continue to offer a full banking service for the foreseeable future, most likely until 2022 at the earliest.
The bank will also tell committee members that in communicating with customers through a process that began last week, the Consumer Protection Code has been placed at the heart of the activity.