Ulster Bank has begun closing to new business as part of its phased withdrawal from the Irish banking market.
s part of a plan announced in February, the bank is starting to take its products and services off the market in preparation for shutting its doors at a later date.
Here is what you need to know.
Who is affected?
Both existing and new personal customers are subject to the changes, as no new applications will be accepted by the bank after October 29.
Existing customers only will still be able to apply for mortgages, however. Starting August 4, though, Ulster Bank will stop making exceptions for applicants who want to borrow beyond the Central Bank lending limits.
Business banking is closing to new customers today with one exception: Lombard Asset Finance will remain open to both new and existing customers. Existing business customers continue as before.
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What products and services are being withdrawn?
If you already have an Ulster Bank account or loan, nothing is happening to you yet.
But Ulster Bank does not want new business, as the bank is starting the process of shutting down.
For existing personal banking customers, some exceptions apply to the blanket withdrawal.
New mortgage lending is the key one here. Because Ulster Bank is in the process of selling its home loan portfolios, this business is worth keeping open.
The bank is also allowing applications for overdrafts and higher credit limits from existing customers to access “short-term emergency funds”.
Insurance renewals will continue as normal, as will financial planning offered via Irish Life.
When will it go into effect?
For new business customers, the change is immediate and no new applications will be accepted after today.
Applications already submitted will be processed, however.
Personal customers can continue to apply for new products or services up to October 29, with some exceptions as outlined above.
After that date, Ulster Bank will be in wind-down mode. The bank is starting to write to customers now to give the formal 60 days notices of the changes.
Do I have to do anything?
If you are an existing Ulster Bank customer, you will be contacted with information on next steps.
It is important to note that current and deposit accounts are not being closed at this stage and loan agreements, overdrafts and credit cards all remain valid. However, the bank’s ultimate plan is to move all of its customers to new providers.
Mortgage applicants who want to borrow outside the Central Bank limits have just a few days to secure their exception before Ulster Bank stops entertaining those requests.
What happens next?
For personal customers, applications that are underway or already submitted will be processed in the normal way.
Business banking continues as normal until further notice.
Approved mortgages and business financing arrangements will eventually transfer to a new provider once Ulster Bank concludes its mooted deals with Permanent TSB and AIB.
Ordinary accounts will be a trickier proposition, unfortunately.
Because current and savings accounts are not included in any of the proposed deals with Permanent TSB or AIB, customers who have them will eventually need to make independent arrangements to switch banks.
Although the situation is not urgent, all indications are that Ulster Bank is aiming to wrap things up by the end of 2022 if possible.