What the Ulster Bank closure means for you

Ulster Bank has announced plans to wind down its business in Ireland and close branches over the coming years. Here’s what the Ulster Bank announcement means for you.

Ulster Bank Ireland will not accept any new applications with effect from close of business 29th October 2021. However, there are some exceptions for existing customers that can be read on the Ulster Bank website.

What’s been announced?

In February 2021 Ulster Bank announced a phased withdrawal of all its banking activity and financial services within the Republic of Ireland.

This means that, after trading since 1836, Ulster Bank will eventually close its doors to all Irish customers over the next few years.

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How does this affect you?

If you are not considering making an application to Ulster Bank between now and close of business on 29th October 2021, there is no need for you to do anything.

Your existing products with Ulster bank are not affected at the moment and they will notify you of any changes to them and any action you need to take when necessary.

If you have already made an application to Ulster Bank they will continue to support you throughout the process of your application until its conclusion.

Why is Ulster Bank closing?

The announcement on 23 July 2021, confirmed Ulster Bank and its parent NatWest Group have agreed a non-binding Memorandum of Understanding (MOU) with Permanent TSB Group, relating to the sale of:

  • performing loans relating to non-tracker mortgages.
  • performing loans and overdrafts in their micro-SME business
  • Ulster Bank’s Lombard Asset Finance business, including the Lombard digital platform
  • a subset of Ulster Bank branch locations

The proposed sale includes around €7.6bn gross performing loans, mainly relating to non-tracker mortgages, and Permanent TSB Group is in line to acquire 25 of Ulster Bank’s 88 branches.

Not all customers and products are covered by this MOU, for example, performing tracker mortgages. They are working on a similar solution for you and will update you as soon as possible.

Which Ulster Bank branches are closing?

Eventually all of the remaining Ulster Bank branches in Ireland will close, but this won’t happen for a little while yet.

For the time being Ulster Bank branches remain open and will continue to do so for the rest of 2021.

Permanent TSB Group are in negotiations about acquiring 25 of the 88 branches, but it’s not yet been confirmed which branches this relates to.

What will happen to your Ulster Bank account?

There is no immediate change to how your account with Ulster Bank will be operated, you can continue to use it without any change.

What happens over the next few years will depend on the type of account you have with UIster Bank and what agreements it makes with other Irish banks to take over their business.

Do you need to do anything?

Mortgage holders

If you have an Ulster Bank mortgage you don’t need to make any changes for the time being, you should continue to pay your mortgage as normal.

If you have applied for a mortgage with Ulster Bank your application should be able to progress as normal, including if you have an approval in principle in place or are waiting to drawdown your mortgage funds.

What if you have a Approval in Principle from Ulster Bank?

If you have an Approval in Principle in place before the 29th of April 2022, this will be valid for the validity period on your Approval in Principle letter.

Existing Ulster Bank customers who want to make a mortgage application can continue to apply for a mortgage loan up to the close of business on 10th June 2022.

Should you switch elsewhere?

This depends on your circumstances:

  • If your existing mortgage rate deal has finished and you’ve moved onto the Ulster Bank standard variable rate you should consider switching your mortgage to save money.
  • If you’re tied into a fixed rate mortgage you’ll probably have to pay an early repayment charge to allow you to switch to a different mortgage lender. This could make it too expensive meaning you’re better off waiting for the time being.
  • If you have a tracker mortgage with Ulster Bank then you should be especially careful. This type of mortgage is no longer widely available to new customers, so if you want to keep your tracker you might need to hold off moving elsewhere.

Ulster Bank has confirmed that if it sells its mortgage loan book to another lender it will honour its customers existing terms, including mortgage rates and terms.

All of your mortgage related questions should be covered in their FAQ support section.

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Current account holders

If you have a current account with Ulster Bank you can continue to use it as normal at least for the time being.

Your existing bank arrangements, including Direct Debits, standing orders and other regular payment agreements are unaffected by the Ulster Bank announcement.

You will be contacted in plenty of time and given the support you need to move banks or close your account.

Credit card holders

If you have an Ulster Bank credit card you can continue to use it as normal.

You should also continue to make at least the minimum payment every month on time, even though these cards will be withdrawn at some point you’ll still need to pay back everything you owe.

Savings account holders

Savings accounts held by Ulster Bank are unaffected and you’ll continue to be paid any interest you earn on your savings.

What about Ulster Bank insurance policies?

Ulster Bank currently offers a range of insurance policies including:

  • Car insurance which is underwritten by Aviva
  • Home insurance which is underwritten by Aviva
  • Life insurance which is underwritten by Irish Life Assurance plc

All of these policy terms should continue to be honoured by the company underwriting them.

What about business customers?

Ulster Bank is withdrawing all “its banking activity and associated services” so business customers will also be affected by this decision.

A legally binding agreement has been agreed with Allied Irish Banks (AIB), on 28 June 2021, for the sale of a €4.2bn portfolio of performing loan products (and up to €2.8bn of undrawn exposures) from the Commercial Banking Division. All the necessary regulatory approvals are likely to take a number of months.

If this affects you, you’ll be contacted in plenty of time with the action you need to take, or you can visit their business support FAQ page for further information.

What does this mean for staff at Ulster Bank?

Ulster Bank has confirmed that there will be no compulsory redundancies for staff in 2021, but this is still a worrying time for those who work at the bank.

The binding agreement with AIB Ulster Bank relating to the sale of performing loans from the commercial division will see the transfer of staff who are assigned to this loan book.

If you’re affected by the Ulster Bank announcement, you can find out more about your rights by reading our guide to your redundancy rights.

Ulster Bank FAQs

Can I open a new account with Ulster Bank?

Yes, for the time being, Ulster Bank are still open to new customers.

Do I need to carry on paying my Ulster Bank loan?

Yes, you’ll still need to continue to make any payments on your loan.

It’s likely that Ulster Bank will sell its loans to another bank at some point and you will then owe the balance to them.

Will Ulster Bank branches in Northern Ireland close?

No, the Northern Ireland part of the business is not affected by this announcement and will continue to trade as normal.

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Warning: If you do not keep up your repayments you may lose your home. Warning: The cost of your monthly repayments may increase. Warning: You may have to pay charges if you pay off a fixed rate loan early. Warning: If you do not meet the repayments on your loan, your account will go into arrears. This may affect your credit rating, which may limit your ability to access credit in the future. Warning: The entire amount that you have borrowed will still be outstanding at the end of the interest-only period. The payment rates on this housing loan may be adjusted by the lender from time to time. (applies to variable rate loans only) Information provided and Interest rates quoted valid at 16/05/2022