Money Mentor Margaret Nolan states, now that PTSB has entered into a legally binding agreement with Ulster Bank, it is time for customers and farmers to prepare to move banks.
Permanent TSB bank (PTSB) has now agreed to purchase €7.6 billion worth of assets from Ulster Bank, Ireland. PTSB has entered into a legally binding agreement with Ulster Bank and its owner NatWest Group to buy Ulster Bank’s Retail, SME and Lombard Asset Finance Business. Last July, the two banks had agreed a non-binding Memorandum of Understanding (MOU), for some elements of Ulster Bank’s retail, and SME businesses.
Ulster Bank which is owned by UK lender NatWest, has 1.1 million customers here, along with 2,800 staff in 88 branches around the country.
The deal includes Ulster Bank’s €7 billion performing non-tracker residential mortgage book, and its performing SME loan book – worth €230m. This SME book will include some farmers’ loans and current accounts.
The Asset Finance loan business acquired is worth about €400m, and includes the Lombard digital platform and 25 branches in Ulster Bank’s branch network (a total of 88 branches).
Ulster Bank staff
PTSB have confirmed that about 450 Ulster Bank employees who are assigned to the businesses that are being acquired, will be entitled to transfer to PTSB.
NatWest will acquire 16.66% of PTSB
As part of the deal Ulster bank will pay about €6.4bn of cash, funded from internal resources and existing funding sources, and NatWest will acquire 16.66% of PTSB Group Holdings. The transaction is subject to further due diligence, obtaining regulatory approval from the Competition and Consumer Protection Commission (CCPC), and the Central Bank of Ireland, and satisfying other conditions and shareholders. It is expected to complete in late 2022 or early 2023.
Performing tracker mortgage loan book
Ulster Bank’s performing tracker mortgage loan book does not from part of this deal with PTSB, but the bank has confirmed that together with NatWest Group, they are working on a pathway for these customers, and will provide an update in due course.
Ulster Bank has confirmed there is no change for their customers immediately, but the bank will begin to serve formal account closure notices to customers, who have current accounts and deposit accounts with them, in early 2022. This means existing Ulster Bank customers will need to choose a new bank, and prepare to move and close their accounts.
Ulster Bank has confirmed they will ensure customers, including those in vulnerable situations, will have ample notice periods, together with support to complete the process. The bank said they are not asking people to move right now, but they are ready to help those who have already chosen their new bank.
Ulster Bank invited other financial providers, not just banks, to a meeting in early December, to outline its plans for communicating with customers about account closures, given the expected increased activity across the industry. The bank stated it will give customers up to six months’ notice, beginning in early 2022. It encouraged all customers (including vulnerable customers) not to leave it until the last minute, to avoid possible bottlenecks of account opening activity in the second half of 2022.
AIB Bank, Bank of Ireland and PTSB are all open to accepting new customers, along with local Credit Unions, An Post Money, EBS and online providers such as Revolut and N26.