Ireland is now effectively a banking duopoly,” says Fianna Fáil MEP, and member of the Economic and Monetary Affairs Committee, Billy Kelleher.

Kelleher was commenting ahead of an expected NatWest announcement confirming that Ulster Bank would cease its operations in the Republic.

“This is a heart breaking day for the thousands of loyal Ulster Bank staff around the country. Nearly 3000 people are now facing into a very uncertain future following this decision, in what is already a period marred by uncertainty.

“Fundamentally, it returns Ireland to a two and two bit banking system, comprised of Pillar Banks, AIB and Bank of Ireland, with Permanent TSB and KBC lagging behind. This is a huge blow to the competitiveness of the Irish banking market and ultimately to Irish consumers. We need strong and healthy competition in our banking sector to continue to drive innovation and lower costs.

“For a growing economy like Ireland, this could have dangerous repercussions for SMEs and mortgage holders. Even before this expected announcement, the Irish lending market was structurally weak. With the loss of one of the big players, consumers will have even less choice and will end up paying more.

“This is yet another blow to the economy. At this stage, I feel the Government must invest in a fully independent analysis of the Irish banking system, and in particular the credit market for SMEs and mortgage holders. The stability of our economy depends on a functioning banking system.

“At a European level, the completion of the Banking Union and the creation of a Single Market for Mortgages has never been more important. We must make it viable and attractive for non-Irish banks to enter the Irish market. This is the only way we can avoid increasing costs for consumers and damage to our economy,” concluded Kelleher.