Irish Union to Meet RBS as Bank to Close 20 Ulster Branches
Irish labor union officials will meet executives at Royal Bank of Scotland Group Plc’s Irish unit next week amid concerns that the lender plans to close about 20 branches, or a twelfth of its network.
An Ulster Bank Ltd. executive detailed the lender’s plans to shut offices on a conference call with some staff last month, the Dublin-based Irish Bank Officials Association said in a letter to its members at the bank, obtained by Bloomberg News. Larry Broderick, the union’s general secretary, confirmed the note’s contents. RBS will provide more detail on the closures in coming weeks, the bank said in an e-mailed statement.
“I’m shocked that an announcement like this was made during a teleconference with no prior consultation with our union,” Broderick said by phone today. “In light of this, the bank has agreed to meet us next week.”
Branch closures at Ulster would mirror moves by lenders such as Allied Irish Banks Plc (ALBK), the nation’s largest mortgage lender, Lloyds Banking Group Plc, which withdrew from the market in 2010, and Danske Bank A/S (DANSKE) following the collapse of a real- estate bubble. RBS has injected at least 10.8 billion pounds ($17.6 billion) into its unprofitable Ulster Bank unit since 2008 to shore it up against real-estate losses and said last year it would eliminate 950 jobs at the operation.
Ulster Bank’s operating loss widened in the first nine months of last year to 797 million pounds from 751 million pounds for the year-earlier period, as a fall in interest income offset stabilizing loan losses. The bank controls 146 branches in the Republic of Ireland and 90 in Northern Ireland, according to its website.
“We continue to keep our branch network under review to ensure that we are operating in the correct locations for our customers,” the bank said.
A separate IBOA notice to Ulster Bank members in November said that Jim Brown, the unit’s chief executive officer, told the union that Edinburgh-based RBS remains committed to its Irish unit. Brown also indicated that a branch review hadn’t been completed and that it continues to examine outsourcing possibilities, according to the note.
RBS acquired Ulster Bank in 2000 as part of its purchase of National Westminster Bank Plc and expanded three years later through the acquisition of First Active Plc, Ireland’s oldest building society.
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