AIB could close up to 90 branches, many in rural areas, as part of a restructuring programme which will see An Post delivering traditional banking services to the lender’s customers.
AIB told staff yesterday its new strategy involved teaming up with An Post to deliver services in the areas most affected by the branch closures.
“AIB and An Post have now agreed to work together to extend the banking services available to customers in selected post offices ... Our distribution network will be enhanced by the new An Post initiative and it will support us in making changes to our current branch footprint.
“Regrettably, this means that the number of branches will reduce as part of the move to lower costs. But through the use of mobile banks and new branch openings in selected areas, AIB will bring banking services to new locations.”
An AIB spokesperson declined to comment on how many branches will be affected, nor has a date been set for the completion of the review.
The state-controlled bank is likely to meet political resistance to branch closures in many rural areas.
AIB has been offering cash lodgement, withdrawal, and credit card bill-paying services through 1,100 An Post outlets over the past decade. These services will be expanded to include cheque lodgements and deposit account transactions.
The bank is engaged in a wide-ranging review of the organisation in an effort to drive down costs. Many rural branches are loss-making.
Under the AIB’s new strategy, it is envisaged that nearly all traditional retail banking services will be done online. Branches will be used to conduct more complex advisory business banking services, particularly to the SME sector.
“In locations where branches are to close, AIB’s closer ties with An Post will ensure that a wider range of ‘over the counter’ banking services are available to customers.”
Staff working in branches that will be closed will be offered the opportunity to relocate to other branches.
AIB recently launched a redundancy programme seeking 2,500 applicants, which will be completed over the next 18 months. Senior management will be taking a 15% cut on salaries plus all benefits. The next layer of management will take a 10% cut, with the most junior staff subject to pay freezes over the next few years.
The strategy document outlines a complete reorganisation of AIB’s structures. As of September, all customers from retail through to corporate clients will be the responsibility of the customers and distribution division, headed up by Bernard Byrne. Fergus Murphy becomes head of products, which will manage and develop all AIB financial products. Peter Spratt will head up the financial solutions group which will deal with restructuring AIB’s legacy troubled assets. Ronan O’Neill will become head of AIB UK.
It is believed that the EBS network will not be affected by the move.
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