Banks still not trusted by the public, according to survey

Irish Banking Culture Board survey shows slight improvement in view of integrity amid latest mortgage tracker fines

Irish banks are still struggling to gain the trust of their customers, according to the Irish Banking Culture Board (IBCB).

The Irish banking sector received a net score of minus 25 in a public survey carried out this year by consultancy firm Edelman, which means public trust in banks is “low but stable in a challenging environment”, the IBCB said.

A similar poll last year delivered a score of minus 28. A figure in negative territory means that more people say they have lower trust in banks than in high trust.

“It is clear from this year’s findings that, while there is some evidence of improvement, more work remains to be done to address deeply ingrained feelings of distrust towards the banking sector among the Irish public,” IBCB chairman Mr Justice John Hedigan said.


“It is also clear that continued positive behaviour on behalf of retail banks, the evidence of which needs to be both visible to and felt by bank customers, is necessary to further restore public trust in the sector.”

Trust deficit

Mr Justice Hedigan said the IBCB knows that member banks “are working hard to address the trust deficit and have undertaken several positive initiatives that show a commitment to improving the culture of the sector”. However, he said that a focus on customer outcomes “will need to be sustained for an extended period before there is significant tangible evidence of improvement in the public’s trust in banking”.

The State’s five retail banks set out in late 2017 to establish the banking culture board. They were engulfed by the tracker-mortgage scandal and faced the prospect of politicians and regulators taking action to address cultural issues in the banks.

The sector is set to shrink to just three banks, with Ulster Bank and KBC Bank Ireland in the process of retreating from the market.

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The results of the second survey of Irish public trust in banks come just weeks after AIB and its EBS unit were fined a record €96.7 million Central Bank fine for their roles in the State’s tracker mortgage overcharging debacle, which resulted in thousands of the group’s customers being overcharged and the loss of 137 properties by borrowers who ran into financial trouble.

The AIB Group settlement brings the total of tracker-related fines to date to more than €178 million. An enforcement investigation into Bank of Ireland is continuing.

The Edelman survey found that rising energy prices are the number one concern facing households, followed by worries about the general cost of living, war in Ukraine and rising interest rates. The European Central Bank is poised to raise rates later this month for the first time in more than a decade to try to tackle soaring inflation.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times