AIB to cut 1,500 jobs and merge branches as it moves to save costs

Plans to close key branches in Cork's Patrick's Street and Eyre Square, Galway
AIB to cut 1,500 jobs and merge branches as it moves to save costs

AIB plans to close its branch on Patrick's Street in Cork, merging it with 66 South Mall. Picture: Dan Linehan

Allied Irish Banks said it plans to reduce its workforce by 1,500 by 2023 and merge a number of branches across the country.

"By 2023, the bank expects to employ 1,500 fewer people due to a combination of normal retirements, natural exits and voluntary severance," AIB said in a statement.

The reduction in staff was first announced earlier this year but was put on hold due to the pandemic. "The bank is confirming that in early 2021 it is to re-open its voluntary severance programme which was paused in March 2020."

AIB also plans to close its branch on Cork's Patrick's Street, moving its operations and services to 66 South Mall. Similar mergers will see the closure of the Eyre Square branch merging with Lynch’s Castle in Galway. In Dublin, AIB’s Westmoreland Street operations will move to its Dame Street branch; the Crumlin Cross branch to Crumlin Road and 52 Baggot Street to 1-4 Baggot Street.

However, the timing of today's announcement has been criticised by the Financial Services Union (FSU) who said the redundancy programme should be postponed.

“We are still in the middle of a worldwide pandemic. No major announcements on job cuts should be made at this stage, particularly by a Bank that is part-owned by the Irish Government," John O’Connell, General Secretary of the FSU said.

The FSU ruled out any possibility of compulsory redundancies and said there had been minimal engagement between the bank and the FSU in relation to the plan. 

“There will have to be immediate meaningful engagement by the Bank. The management need to provide the evidence to back up their assertion of the requirement for less staff, while demonstrating that those staff remaining will not be overburdened," Mr O'Connell added.

AIB said the merging of branches was due to the rapid acceleration in digital banking due to Covid-19. They said they have seen a 27% increase in digital daily usage among customers aged over 65 and a 9% cent increase in digital adoption among the over 40s.

AIB CEO Colin Hunt said the plan has been influenced by the accelerating effect of Covid-19 on customers’ preference for digital banking.

“Our heightened focus on cost controls, the pursuit of new growth opportunities and our investment in digital innovation will enhance the range of financial services and products for our customers, while generating value for our shareholders and putting the bank on an even stronger footing to meet the challenges ahead,’’ he said.

AIB CEO Colin Hunt said the strategic review has been shaped by the acceleration in digital banking and the changing ways of working through the Covid-19 pandemic.
AIB CEO Colin Hunt said the strategic review has been shaped by the acceleration in digital banking and the changing ways of working through the Covid-19 pandemic.

Since the outbreak of the pandemic, 80% of AIB’s workforce has been working from home. The bank said that in light of the effectiveness of remote working, they have re-assessed their future head office requirements in Dublin.

AIB earlier this week completed the exit from its former headquarters at Bankcentre, Ballsbridge and will leave adjacent premises at Hume House on 31 December. It is planning to vacate a further three of its six remaining Dublin head office locations as leases come up for renewal over the next few years.

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