The acquisition of Ulster Bank’s €7.6bn loan portfolio by Permanent TSB (PTSB) has been cleared by the Competition and Consumer Protection Commission (CCPC).
In February 2021, Ulster Bank announced plans to withdraw all banking services in the state. PTSB struck a deal with Ulster Bank to buy the portfolio 10 months later, while its shareholders approved the move last month.
Assets consist of Ulster Bank’s untracked performing mortgages; a subset of its unmonitored non-performing mortgages; and its entire successful portfolio of direct loans to micro-SMEs.
Ulster Bank said the subset of unmonitored non-performing loans are not past due, meeting their contractual mortgage payments, but are on probation. The majority of accounts will be transferred before the end of 2022 or the beginning of 2023.
The deal also includes the sale of 25 properties across Ulster Bank’s branch network, as well as Ulster Bank’s asset finance lending business. The branches are expected to close as Ulster Bank branded branches in early 2023, reopening as permanent TSB branches shortly thereafter.
Ulster Bank said it would write to customers at those branches to let them know the exact timing for their own branch.
The CCPC said it conducted a preliminary investigation into the acquisition by PTSB before a full investigation was launched in May to determine whether it could result in a substantial lessening of competition in the state.
Based on a review of the evidence before it, the CCPC accepted the parties’ argument that Ulster Bank would have left the state whether or not the asset sale proceeded.
The CCPC considered whether the acquisition would result in a substantial lessening of competition, compared to the alternative scenario of a sale of Ulster Bank’s mortgage and micro-SME assets to another buyer, and concluded that this would not would not be the case.
PTSB said all parties were working to complete the acquisition of Ulster Bank’s untracked residential mortgage business in the last quarter of 2022.
Around 400 to 450 Ulster Bank employees who are wholly or mainly engaged in retail, SME or AFT finance businesses will be eligible to transfer to Permanent TSB.
The final number of transferred employees will be confirmed at the end of the transaction.
PTSB Chief Executive, Eamonn Crowley, said: “Following recent approval from our own shareholders, we have today taken another important step in our transformation journey.
“Furthermore, as part of this transaction, Permanent TSB will expand its nationwide branch network to 25 locations, furthering our commitment to communities across Ireland.
“We are working closely with Ulster Bank to ensure a smooth transition for Ulster Bank customers and colleagues to Permanent TSB, which will begin in the fourth quarter of this year, subject to regulatory approval.
“We look forward to welcoming them to a bank with a deep community heritage and customer service ethic.”
Ulster Bank chief executive Jane Howard welcomed the approval. “Ulster Bank notes and welcomes the CCPC’s decision on the sale of the portfolio to Permanent TSB,” she said.
“This is a significant step forward in advancing our exit, and our next steps over the coming weeks and months will be to communicate with the colleagues who will be transferred and to communicate with the customers who will should migrate to the permanent TSB.”