Bank takeovers ‘could impact consumers’

FINANCIAL services union Amicus has warned foreign takeovers of Irish banks could have “serious implications” for Irish consumers.

Deputy national secretary Jerry Shanahan said the prospect of AIB or Bank of Ireland being taken over was a constant threat and would create a banking monopoly that would effectively eliminate competition.

Speaking at the union’s annual conference in Ennis, Co Clare yesterday, Mr Shanahan said employment in the Irish financial services sector had remained strong during a period of relatively slow growth and economic uncertainty.

But he warned of potential threats to jobs and conditions of employment in the sector. These threats came from possible consolidation in the industry and mergers between banks to achieve cost savings and staff reductions.

Mr Shanahan also said the accession of 10 new countries to the EU in May would make the task of attracting foreign investment more difficult, as central and eastern European countries looked to compete on the basis of lower labour costs.

The emergence of so-called “offshoring”, the industry term for moving administrative and call centre operations to low-cost countries where English is widely spoken, would also threaten financial jobs in Ireland, according to Mr Shanahan.

However, he said these threats should not be exaggerated and added that recent high-profile moves to relocate activities to cheaper countries should not be seen as the start of a trend.

“The best guarantee of job security in a globalised environment is to have higher quality jobs with higher skills and expertise. This in turn means a continuous high level of investment in education and training and career development by employers,” said Mr Shanahan.

He said the structure of the Irish financial services industry meant it was less vulnerable than Britain to the loss of jobs to overseas competitors. Amicus would not give in to pressure from employers to cut jobs or salaries to allow Irish financial services operations to compete more effectively.

Mr Shanahan described arguments in favour of cutting costs here to fend off competition from eastern Europe as “spurious” and said employees of Irish banks had contributed to the financial health of their employers through their continuing hard work.

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