Business group wants inquiry to halt 'headlong rush' into Northern Ireland bank closures
A BUSINESS body has said it hopes that a Westminster inquiry into the banking structure in Northern Ireland will put the brakes on a "headlong rush" to close rural branches.
The Northern Ireland Affairs Select Committee (NIASC) will examine whether banks that operate in both Northern Ireland and Great Britain have different operations in the different regions. It will also look at the lack of availability of regional data on lending, which means it is difficult to see if the banks are reaching their lending targets.
Also on the agenda is the availability of finance to small businesses and branch closures. The committee will look, too, at the possible break-up of the Royal Bank of Scotland group, parent of Ulster Bank.
Earlier this month Jim Brown, head of Ulster Bank, said that up to 40 branches across Ireland will close by 2014 and 1,800 jobs will be cut by 2016. And Danske Bank has trimmed its branch network to 59 from 72 this time last year.
The Federation of Small Businesses says the closure of banks is likely to damage the rural economies they currently serve.
The FSB's Northern Ireland policy chairman, Wilfred Mitchell, said the organisation will be submitting written evidence to the NIASC and hopes to give oral evidence as well, particularly on access to finance for small businesses and access to banking in rural communities.
"We are pleased to see the banking structure here being examined by a Westminster committee, because it will help bring the findings closer to the departments and bodies which regulate banking here," he said.
The FSB's written evidence will include the results of its most recent survey on the issue, as well as the substantial report into 'SME: Banking Relationships' which it undertook with the Ulster Business School. The Northern Ireland Affairs Committee has asked for written submissions ahead of holding planned public evidence sessions in the autumn. The inquiry will also examine recent reports that the Treasury is considering breaking the relationship between RBS and Ulster Bank and persuading the Irish government to take control of the latter.
In a wide-ranging exercise, MPs will assess the treatment of staff made redundant with the demise of the former Irish Bank Resolution Corporation.
The Northern Ireland Independent Retail Trade Association (NIIRTA) welcomed the inquiry.
NIIRTA chief executive Glyn Roberts said: "This is a welcome inquiry which we hope will provide solutions about how we improve access to finance for small traders and ensure we have banks fit for purpose which play their role in investing for recovery.
"This inquiry must be about learning from past mistakes and looking to the future. NIIRTA looks forward to submitting evidence to the committee."