Fewer than 100 complaints over exit of Ulster Bank and KBC

Low level of complaints to banking watchdog is in contrast with criticism from Central Bank governor, who said experiences of  customers switching 'leaves something to be desired'

The FSPO report shows 4,647 complaints were closed last year, with more than €3.4m paid to complainants in mediation settlements and a further €965,527 paid to complainants by way of settlement.

Fewer than 100 complaints have been received so far by Ireland's banking watchdog in relation to the exit of Ulster and KBC banks from the Irish market.

A report on complaints received by the Financial Services and Pensions Ombudsman (FSPO) published today shows just a small number of issues being raised by thousands of customers who have moved or closed accounts as the banks depart.

The complaints represent just a fraction of the 4,781 complaints the ombudsman Liam Sloyan received last year in relation to banks, insurance firms, and pension providers — a slight increase of 123 compared to 2021.

Banking complaints represented 55% of all complaints received. The conducts most complained of in banking complaints were customer service, disputed transactions, and maladministration.

In his report, Mr Sloyan said the departure of two major banks posed the potential for a high volume of complaints to his office. 

It is notable that by the end of 2022, the FSPO had received less than 100 complaints identified as relating to market exit.

"It is very positive that, to date, for the vast majority of impacted consumers, the departure of two major banks has not given rise to issues leading to a complaint being made to this office," he said.

"I am pleased that our work has contributed to the outcomes seen to date, by ensuring that our stakeholders were aware, on an ongoing basis, of the experience of the impacted customers, as communicated to this office."

Liam Sloyan said for the vast majority of impacted consumers, 'the departure of two major banks has not given rise to issues leading to a complaint being made' to the ombudsman.

The low level of complaints stands in contrast with criticisms of Ulster and KBC banks in November by the Governor of the Central Bank, Gabriel Makhlouf, who said the experiences of banking customers switching is "leaving something to be desired". 

He cited unanswered phones and other issues that customers face in making the switch.

The FSPO report shows 4,647 complaints were closed last year, with more than €3.4m paid to complainants in mediation settlements and a further €965,527 paid to complainants by way of settlement.

In one case, a financial institution gave incorrect information regarding a mortgage product. The situation then became more serious when a staff member altered the contents of a mortgage application form, without the consumers’ authority. The ombudsman directed the provider to pay €10,000 in compensation and referred the matter to the Central Bank.

In another case, a complainant transferred €16,300 from her Irish current account to a cryptocurrency account on the advice of a cryptocurrency adviser. She subsequently informed the bank that she had been defrauded of the money and felt that the bank should have warned her not to transfer the money to the adviser. 

However, the bank clarified that it had facilitated the transfer at her request, to the cryptocurrency company. She closed her complaint.

Mr Sloyan said his office continues to see new complaints related to tracker mortgages.

"The FSPO has been receiving complaints relating to tracker mortgage interest rates since 2008. While the number of new tracker-related complaints is on a downward trajectory, it is notable that 139 new complaints of this nature were made to the FSPO in 2022," he said.