ICMSA President Pat McCormack claims the lack of competition in retail banking is “directly related to the lack of energy and commitment at official level” following Friday’s announcement that KBC is set to exit the Irish market.
Reacting to KBC’s announcement, Mr. McCormack said: “The only thing more alarming was the realisation that no-one at official level seemed remotely bothered.
“The question we all – farmers, businesses and private individuals – need answered is why every new bank that come into the Irish market seems to arrive at the same conclusion after a couple of years and then leaves?”
Mr. McCormack said that it wasn’t good enough for the Central Bank and other regulatory offices and authorities to just shrug their shoulders on a timeline that seemed now firmly established.
“Foreign banks arrive in a blaze of publicity and a fanfare of advertising and marketing, win a decent share of business from Irish customers desperate for internationally competitive financing and loans. Then, after a few years, announce that they’re puling out and selling their business back to one of the ‘Big Two’ that, ironically, their customers had left seeking better banking services and options. What’s going on here and when are we going to see a serious examination as to why none of these foreign banks want to continue offering retail banking here?
“Irish farming has relatively low debt, is generally fully collateralised, and is considered one of the most sustainable and technically advanced in the world. But we are still effectively confined to a choice between two banks,” he said.
The ICMSA President called on Minister for Finance, Paschal Donohoe, to set up a group to investigate why Ireland seems unable to attract new banking institutions.
“It’s well past the time when this could be considered as some kind of national quirk; we need a modern banking sector with real competition and we seem to be going backwards into a fixed uncompetitive duopoly of the two old players,” he said.