The State’s competition watchdog has given the go ahead for AIB’s purchase of a €4.2 billion book of commercial loans fromBank, which is leaving the Irish market. However, the Competition and Consumer Protection Commission also warned that the ongoing raft of consolidation in the banking sector could hurt customers.
Ulster Bank’s parent, Natwest, announced last February its withdrawal from the Irish banking market. It struck a deal last summer to sell its commercial book of loans to larger businesses with turnover of more than €2 million toThe CCPC is separately examining a deal to sell Ulster Bank’s SME loans to businesses that are below €2 million toBelgian bank KBC is also leaving the Irish market, further reducing the options available to borrowers.
“International evidence shows that higher concentration in banking services is likely to have a detrimental effect on competition, leading to poorer outcomes for business borrowers in terms of pricing, innovation and service,” said the CCPC. It said some of Ulster’s corporate customers that it spoke to during its investigation “substantiated this” by indicating their concern at the bank’s exit.
“The CCPC accepted the argument of the parties that Ulster Bank would cease to provide commercial loans to businesses in the State with turnover greater than €2 million, irrespective of whether or not the sale of its commercial loan portfolio to AIB proceeded,” said the competition regulator. The regulator said it has “concerns regarding the competitive landscape of the Irish banking services market”.“Our next steps, starting today and over the coming weeks and months, will be to communicate with colleagues who will move to AIB … and to communicate to impacted customers who will migrate as part of this,” said Ulster.
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CCPC approves AIB purchase of Ulster Bank loansThe Competition and Consumer Protection Commission (CCPC) has given clearance for AIB's proposed purchase of Ulster Bank's €4.2bn performing commercial loan book.
Source: RTEbusiness - 🏆 16. / 61 Read more »
CCPC approves AIB purchase of Ulster Bank loansThe Competition and Consumer Protection Commission (CCPC) has given clearance for AIB's proposed purchase of Ulster Bank's €4.2bn performing commercial loan book.
Source: RTEbusiness - 🏆 16. / 61 Read more »