A new restructuring plan approved with the European Commission today will result in Bank of Ireland no longer offering new mortgages through its intermediary channel. This channel accounted for approximately 15% of the bank’s new mortgage lending over the past three years.
However, in a reversal to an earlier decision, the bank will now be permitted to keep its assurance division, New Ireland Assurance Company.
Any restrictions on service via the intermediary channel will serve as a major concern for those affected. Already, the third largest bank operating in the state, Ulster Bank continues to refrain from offering mortgages via intermediaries. This leaves the two dominant players being Bank of Ireland and AIB, although Permanent TSB and KBC have also been courting intermediaries of late with higher levels of funding and higher loan-to-value limits (smaller deposit requirements).
Todays agreement does not affect Bank of Ireland consumer banking businesses in the UK including its partnership with the UK Post Office, or its businesses in Northern Ireland.