Banks have a “considerable distance to travel” on customer focus

Banks will have to submit a “detailed action plan” on dealing with the issues identified

Banks have a “considerable distance to travel” on customer focus


The Central Bank has warned that Ireland’s main banks have a “considerable distance to travel” to become more consumer-focused.

The regulator issued the warning after carrying out a report on behaviour and culture at the country’s five main banking institutions - AIB, Bank of Ireland, Permanent TSB, Ulster Bank and KBC Bank Ireland.

The Finance Minister Paschal Donohoe ordered the report in the wake of the tracker mortgage scandal.

It found that the banks have all made differing levels of progress in their “transformation towards a consumer-focused organisational culture” – however, all were found to have some way to go.


The Central Bank has now asked each of the banks to submit a “detailed action plan” outlining how they will address their own specific issues identified in the report and ensure the risks are mitigated.

The regulator's director general for financial conduct, Derville Rowland said this would include senior bankers signing personal statements of responsibility:

“Everybody working in financial services would have to adhere to high standards of integrity, honesty and, of course, putting consumers interests first,” she said.

“There would be a higher standard placed on the senior leaders and organisations would have to set out clearly who was responsible for what.”

The right thing

The plan would require new legislation – and the report said any law change should “go significantly beyond the current requirements for staff to be fit and proper, setting conduct standards for staff and ensuring clearer lines of accountability within firms.”

Ms Rowland said the Central Bank will continue to monitor progress at the major institutions and examine how they dealt with the tracker mortgage scandal:

She said banks should “not just focus on the legal thing but focus on doing the right thing by their customers.”

“We have set up a focused conduct pillar in the Central Bank to drive that attitude through these institutions and it’s our highest priority to make sure that they live up to their requirements to put customers first.”

Consumer focus

The review found that, at all five banks, there was no collective understanding of what consumer focus actually means.

It found a number of patterns in leadership and corporate mindset that could jeopardise the move toward a more consumer-focused culture.

Several executive committees were found to display “fire-fighting behaviour” with a focus on urgent and short-term issues.

The report also raises concern about leadership styles – with executives occasionally reverting to directive approaches cultivated during the financial crisis.