Personal finance columnist Jill Kerby examines the impact of Ulster Bank’s withdrawal from the Irish market. This was followed a week later by a shocking announcement from the Bank of Ireland that it would close several branches across the country from September …

There are 1.1 million Ulster Bank customers in these 26 counties and I am one of the lucky ones because I only have one checking and savings account (and one credit card) that I have need to find new accommodation. And yet, because I was orphaned from Danske Bank five years ago, I know that the process of change can be longer and more complicated than it is claimed.

This will certainly be the case with the unprecedented shutdown of one of the state’s largest and oldest banks, one with a quarter of all bank customers.

It is also because most bank customers do all their business with one single institution: their current account transactions, personal loans, credit cards, overdrafts, mortgages and savings accounts.

For them, the departure of Ulster Bank will not be a ‘one-stop-shop’ event, but it is far more likely to involve a number of different institutions which may not even be of their choosing.

For example, it has already been agreed for UB’s business clients that their business loan portfolio and the staff that takes care of it will soon be taken over by the other majority state-owned bank, AIB.

It is also reported that Permanent TSB appears likely to take over some or all of UB’s fixed-term mortgages and personal loans (including the EUR 7 billion of follow-on mortgages).

Under the Consumer Protection Code, anyone who takes out these loans – whether an Irish bank or a foreign investment fund – will have to abide by the terms and conditions of the contract. But that’s not the case if you decide – wrongly – to transfer your variable, fixed or tracker rate mortgage yourself to a new provider as part of choosing a new bank to deal with.

A new bank may agree to match your outstanding mortgage balance, but they won’t offer a tracker and the new loan will be at their rate and terms. Your loans (and savings, credit cards) are all separate entities.

As far as we know, according to mortgage expert Michael Dowling of Dowling Financial, the only Irish bank to have shown interest in UB’s existing mortgages and personal loans is PTSB “and some or all of the 20 billion euros and more of the deposit book ”, although it is expected to honor all fixed-rate and forward deposit contracts.

Dowling is not convinced. Savings accounts are seen as losers for banks, and especially credit unions, many of which have deposit limits as low as € 10,000, due to the negative interest they have to pay to the European Central Bank to keep excess funds.

This explains, he said, why banks might start charging customers with large deposits negative interest, just as they do for business customers.

“While a new bank may be happy to open a new checking account for the old Ulster Bank customer – they can still make money on those accounts – that customer might end up having to look for someone. to recover his savings. “

Meanwhile, anyone with a UB credit card balance will likely have to clear it, says fellow advisor Karl Deeter of Irish Mortgage Brokers: “Credit card loans won’t be sold like mortgages will. This is a variable rate credit facility. A new bank is under no obligation to give you a new credit card or even one with the same limit you had at Ulster Bank.

Under the current terms of the bank switching code – detailed on the website of the Competition and Consumer Protection Commission, www.ccpc.ie, Ulster Bank will be obligated to facilitate the transfer from your checking account only to the new institution as they receive instructions from your new bank.

But, said Deeter: “If you don’t close your account on the date Ulster Bank asks you to, they will just close it for you, ask you to erase your overdraft or your credit card. [mortgages and other loans will have been sold off] and send you a check for any money you have left in a deposit account.

Deeter and Dowling both caution against leaving the switching process to the last minute – say, the end of 2022 – to find a new bank.

“It’s something the Irish do all the time,” Dowling said. “They leave their tax returns at the last minute.”

Not only will Ulster Bank’s staff and IT resources be near depleted by then, he said, but other banks and credit unions are unlikely to want to see, potentially, tens of thousands. of customers making their way to their doors (or websites) at once.

Should you move out now … or do nothing until Ulster Bank is ready for you to leave?

Where should you go? Is there a better way to manage your accounts? I am also on this trip. Watch this place.