Bank of Scotland to shake up market

David Clerkin

The bank, which until now had confined its Irish operation to business banking and a phone-based mortgage outfit, swooped on its Irish rivals with a revolutionary move to take over the ESB’s chain of ShopElectric retail outlets and turn it into a branch network.

Bank of Scotland (Ireland) chief executive Mark Duffy said the move would be “fantastic” for consumers and would allow the bank to aggressively roll out customer-friendly products. “We really do see it as a win-win deal,” said Mr Duffy, who said the bank, the ESB and the staff involved would all benefit.

The bank will spend E30 million on refurbishing the outlets and reopening them as bank branches. But Mr Duffy said the environment in the new offices would be radically different to existing banks in Ireland.

He pledged that the bank would flip current banking practice on its head by encouraging customers into branches as much as possible, offering cheaper deals and doing business on customers’ terms. The shops already open six or seven days a week, for longer hours than existing banks, and this would continue when they reopened as Bank of Scotland branches, he said. Most existing banks only open from Monday to Friday.

The bank also plans to spend “many hundreds of millions” on staff training and a new state-of-the-art computer system. More than 400 ShopElectric staff will be offered jobs in the branches on top of redundancy payments from ESB.

Mr Duffy said these staff already had strong retailing skills and that they would undergo extensive training to transfer their skills to retailing financial services. “The last thing I want is traditional bankers around the place,” said Mr Duffy. Training will take place during the downtime between the closure of each ShopElectric store and its reopening as a branch.

The stores will close on a phased basis during the second half of the year. The first branch will open in November, with up to half of the total up and running by this time next year.

Mr Duffy said it would be naïve to expect all of the staff to transfer but that the bank already had experience of taking over a semi-state, after taking over the former ICC Bank, and that this would be useful in the months ahead.

The bank will launch six new products in the coming months, including new mortgage, credit card and current account offerings.