Retail Bank Overview - Ireland - April 2012

Although the turmoil brought about by the financial crisis has largely passed, the Irish retail banking sector remains entrenched in a period of transition and uncertainty. The competitive landscape has changed dramatically – particularly in RoI – and there will almost certainly be additional changes in the years to come due largely to government-led restructuring and reform. Moreover, for the fourth consecutive year, the economic environment is extremely challenging, both for consumers and providers of retail banking services.

Consumers have lost confidence and spending power, limiting demand for a host of retail banking products, while lingering liquidity problems in the financial sector are obstructing financial institutions’ activities, particularly with respect to consumer lending. In addition, consumer trust and loyalty towards financial institutions are at an all-time low, which opens the door for non-mainstream providers of financial products and services to gain a firmer foothold in the Irish market.

Key themes in the report include:

How has the ‘recession experience’ altered consumers’ engagement with personal finance? – Are consumers more careful with where they put their money? What impact has the recession had on consumers’ financial position and appetite for financial products and services?
Has the financial crisis affected consumers’ attitude and loyalty towards financial services providers? – How has the brand image of financial service providers been changed by the recession?
What impact has the crisis had on the cost of financial products to consumers? – Have consumers found banking to be a more expensive prospect?
What will the impact of restructure and reform in the banking industry be? – How will these affect consumer usage of banking products?
What are consumers’ preferred channels for accessing banking services? – Do consumers still prefer visiting bank branches, or has online banking made significant in-roads?
How have ownership levels of personal finance products been affected by the recession? – Has there been a shift in the types of financial products owned by Irish consumers?