Q&A: What is happening at Danske Bank?

What is happening?
Danske Bank has reviewed its Irish operation and decided to stop selling personal and banking products to new customers with immediate effect, and will focus its business on corporate and institutional clients. The bank first entered the Irish market in 2005 when it acquired National Irish Bank in the Republic and Northern Bank in Northern Ireland.

Why has it decided to do this?
The bank said it had made its move because of the "backdrop of a difficult economic and trading environment" in which it had been "unable to re-establish a sustainable retail banking business model".

What do customers of Danske Bank need to do now?
The bank says customers "do not need to take any action today". It added that it appreciated that customers would be concerned by the announcement and said it would write to them in the coming weeks "to clarify the impact the decision will have on each product or service" that they hold.

Will existing products be withdrawn?
Yes. Existing day-to-day personal customer products and services will be withdrawn on a phased basis during the first half of 2014. Danske Bank's personal banking service at post offices will cease in line with the withdrawal of its personal banking services in 2014.

What should current account customers expect?
The bank will write directly to current account customers to outline the steps they should take. Customers with a current account will be given at least two months' notice of the withdrawal of their service. Current account "switching packs", which comply with the Central Bank's Switching Code, are available from the banks that remain in the Irish market. The money in current accounts will be "repaid in full", Danske Bank stressed. If customers do not switch their balances to an alternative account, or request such a transfer at the time of closure, they may be issued with a cheque.

Will overdrafts have to be cleared before the current account is closed?
The bank will withdraw its overdrafts service at the same time as it phases out its current account services. If customers cannot pay off their overdraft within the notice period, they may be able to transfer it to their new current account provider. If this is not possible, it may be possible to convert the overdraft into a personal loan product at Danske Bank – however, a spokeswoman for the bank says the availability of such arrangements has not been finalised.

What are the consequences for savers?
Deposit accounts will also be closed in the first half of 2014, with any outstanding balance, together with any interest due, returned to customers in full. Again, two months' notice will be given for the withdrawal of the savings account. Customers will continue to benefit from combined deposit protection under the Danish Guarantee Fund for Depositors and Investors and the Irish Deposit Guarantee Scheme, up to a maximum of €100,000 per depositor.

What will happen to borrowers' loans?
There is no immediate change to mortgage and personal loan arrangements. The outstanding amounts will continue to be repaid within the existing agreed terms and conditions and the bank will write to customers shortly to confirm this position. The spokeswoman said the bank had no plans to sell off its loan book and that it was a core part of the bank's business.

What should borrowers in financial difficulty do?
"We are fully committed to continuing to support
any customer who is experiencing financial hardship," the bank said. It advised customers who want to discuss a financial difficulty or set up a repayment schedule to contact the bank on 1890-818822.