BoSI to remain in State as 'independent entity', says Cowen

BANK OF SCOTLAND Ireland (BoSI) has indicated it intends to continue in the Republic as “an independent entity” Taoiseach Brian Cowen has said after the bank’s announcement it is closing its 44 retail branches with the loss of 750 jobs.

As Fine Gael leader Enda Kenny asked about further job losses in the banking sector, Labour expressed incredulity that the Government only learned on Tuesday of the bank’s intention to shed 750 jobs. Party leader Eamon Gilmore asked “was the Government asleep while this bank was considering withdrawing from retail activity and closing its branches”.

Mr Cowen said however that “while this major announcement of job losses by the bank is a matter of concern and regret for all of us, it reflects the economic and banking realities as they exist here”.

He told the Dáil he had been assured that “all customers of Bank of Scotland Ireland will be looked after and will not be disadvantaged by the changes”. He said “Bank of Scotland Ireland will continue to have a presence in Ireland”.

Mr Kenny warned that “we can’t have a return to the old days of the cosy cartel that operated between Bank of Ireland and AIB. Did the Government reject any offer made by Bank of Scotland to be part of the third banking force?” he asked.

“Have you any indications based on the allegations that are now moving through circles that there could well be thousands of other bank job losses because of other international banks pulling out of this country?”

Labour leader Mr Gilmore wanted to know when the Government first heard that the bank was going to close its branch network. “This after all is the bank that arrived in to great cheers with a buccaneer approach to lending. It was the first with the 100 per cent mortgages. It introduced the tracker mortgages.”

Mr Cowen said he had been assured that BoSI customers would not be disadvantaged. He understood “the Government was notified yesterday under the Redundancy Acts regarding the proposed job losses of 750 workers from this organisation.”

Mr Gilmore found that “absolutely incredible” because “this bank has been on the radar quite significantly, not only in respect of its approach to lending. Arguably this bank’s lending practices . . . certainly contributed to our banking problem”. He said: “The bank has a significant share of the mortgage market and . . . Now it has announced it will close its entire branch network to the disadvantage of its customers and to the personal, income, family and job loss of its 750 staff.”

Mr Cowen said “the Department of Finance and the Central Bank monitor the banking situation on an ongoing basis”. Bank of Scotland Ireland “is a subsidiary of a large bank, which as we all know has suffered significant losses”.

He added that “the changed economic realities . . . have meant that other banks, which are not part of the State guarantee, have had to take certain decisions in respect of their business operations here and some 750 jobs are being lost, which is a matter of great regret and concern”, but “it reflects the economic and banking realities as they exist here”.