Halifax Ireland is closing down its Irish banking branch due to the economic downturn. The Bank of Scotland (Ireland) owns Hailfax and they said that a review of it's banking in Ireland found that the bank was too small to survive in the current market.
The bank only opened its Irish branch four years ago. Bank of Scotland's chief executive Joe Higgins said the bank was "fatally undermined" by the recession.
"There is no strategy for this business that will see it achieve break-even or profit in a realistic timeframe. Unfortunately, Halifax is simply too small to succeed in this contracting market,” said Higgins.
The bank will let go half of its 1,600 strong workforce by the end of July. The bank currently holds about 7 per cent of the Irish mortgage market. Over 45,000 customers will retain their mortgages with Halifax but will be unable to borrow more money from the bank.
“This isn’t the outcome that we looked for. I was involved in the launch of this business [Halifax]. We had very different views and ambitions for it – it is not an easy day for any of us that work in this bank.”
The bank was one of the most competitive banks on the Irish market and succeeded in reducing mortgage rates when they were first established. Higgins said that the bank tried to merge with several smaller banks in Ireland to become the "third force."
A merger with EBS and Irish Nationwide would have allowed the bank to compete with Ireland's two largest banks, Bank of Ireland and Allied Irish Bank.
Halifax has a loan book of $45.5 billion; the bank is expected to write down $14 billion of it.
Unite union represents Halifax bank staff and they say that staff will "fight tooth and nail to maintain their jobs".
The union is asking the government to consider supporting the "third force" merger.
Where does the term “the luck of the Irish” come from?