by Mark Johnston
The banking giant Lloyds banking group has announced that it will be pulling its sister company Bank of Scotland Ireland out of Ireland and will stop trading there by the end of this year.
Bank of Scotland Ireland trade under the groups Halifax brand which they bought in the middle of the financial crisis. Lloyds are pulling the operation and it will cease to be a lincensed bank on the 31st of December this year.The decision has been made following a strategic review that the Lloyds group commissioned. The review revealed that the business in Ireland had little opportunity to grow especially given the recent property crash in Ireland. All Customers will be transferred to Bank of Scotland.
This is the second shock strategic announcement from the group following the decision earlier this year to close down the retail and intermediary side of Bank of Scotland Ireland. Many believe that this is as a direct result of the bank reporting as much as 90% of its £13 billion property book in Ireland to be impaired.
As spokesperson for Lloyds banking group said: “Customers will be contacted in the coming weeks to advise them how these changes would affect them.” Bank of Scotland will be responsible for the closure of the banking operations and running down the lending portfolio so that customers are not affected by the decision. The Lloyds spokesperson went on to confirm that current Bank of Scotland Ireland customers would not see any change.
Bank of Scotland will be responsible for any administrative duties on existing loans and following the transfer to them will keep the same repayment arrangements that are current in place until the account is settled or un til maturity.
The Lloyds Banking Group are committed to supporting the current customers and will work with any depositors with them to make sure the transfer is as smooth as possible. Banki of Scotland Ireland will also cease to provide wealth management services, current services will continue until the end of the year.
The group also announced plans that it would employ an independent company to oversee the changes and any administration for the Bank of Scotland Ireland. Lloyds is looking to redeploy the majority of affected employees to its other businesses in Ireland and Northern Ireland such as its Halifax branch network, the groups customer services centre in Northern Ireland and its insurance arm with its operating base in Shannon as non of them are affected by this latest announcement.
Around 800 staff will be affected by the change. They were briefed by managers and told that Lloyds were “committed to working through these proposed changes with employees carefully and sensitively.” The bank workers Union Unite have also been told and are meeting with the Banking group to discuss the changes.
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