Shake-up or break-up? Political parties' plans for the Irish banking sector
While most of the political parties have been forthright in their opinions on how shake-up the banking sector during this general election campaign, much of the rhetoric has been about how the changes will benefit Irish taxpayer.
But there are also plans from the various parties that could potentially have an impact on the lives of those working in the industry. We've rounded up the key points below:
Catchy campaign slogan: Real plan, better future
What Ireland's bankers can expect: Perhaps understandably, Fianna Fáil appears reluctant to talk of a shake-up of the banking sector and is instead keen to ram home how the effective the measures it's already implemented - state guarantees, NAMA, bank recapitalisation, IMF-EU bailout - have been.
Oh, and it also talks about how the IMF-EU programme will see the "fundamental downsizing and reorganisation of the banking sector", just to remind you of the imminent cuts.
When it does talk about job creation, Fianna Fail says it is committed to "reducing the heavy reliance in services exports on two sectors - software/ICT and financial services".
But it also has plans to push through the 'green IFSC' - Ireland's campaign to get ahead in carbon and green finance, first mooted in late-2009 - which is tipped to create 4,000 jobs over the next five years and generate €6bn in revenue.
Catchy campaign slogan: Let's get Ireland working.
What Ireland's bankers can expect:
Some of the higher-profile elements of Fine Gael's proposals for the banking sector have been well covered - renegotiating the terms of the EU-IMF package, burning bond holders, tapping the European Financial Stability Fund and securing $50bn in funding from the Federal Reserve. However, there are other issues that could affect your prospects.
Pay will be squeezed: Within 100 days of being in office, they will expect each bank under state support present a plan of how it "intends to cut its wage bill and other costs" to avoid hiking mortgage rates. Senior staff will have their pay capped, and bonuses are off until banks are weaned off state support.
Banks will be closed or sold: Anglo and Irish Nationwide will be wound up by the end of 2011 under Fine Gael's plans, EBS will be sold to a private owner, AIB could be sold to a large foreign bank and Bank of Ireland could become the new banking poster boy. Expect some fall-out here.
You will have a new boss: Replacement of directors and senior managers and Irish banks will be sped up, and staff will be recruited to run a new banking policy division in the Department of Finance.
NAMA changes: Fine Gael will bar the plans to transfer property loans worth less than €20m into NAMA (or NAMA 2), will force the body to outsource 70% of its loans to independent asset management companies (which could effectively wipe out in-house NAMA teams in the banks), and consider the use of investment vehicles like Reits to move the loans into the private sector.
Shelving NAMA 2 is a mixed blessing from a recruitment point of view. On the one hand, as AIB chairman David Hodgkinson pointed out, managing the loans could require "in excess of 1,000 staff", but the loss of these loans threatens "a viable core business", which would undoubtedly lead to hefty redundancies.
Catchy campaign slogan: One Ireland: jobs, reform, fairness
What Ireland's bankers can expect: Like Fine Gael, with whom many believe it will team up for a coalition agreement, Labour is anti-NAMA 2, wants Irish bond holders to share the burden, will look to negotiate a better interest rate on the IMF-EU deal (albeit now on a Europe-wide basis) and wants to encourage more SME lending. However, there's more:
Creation of a state investment bank: Forget the third force in banking, Labour wants a state-owned - but nonetheless independent - NRPF-funded investment bank to kick-start the economy and extend capital to Irish firms and fund infrastructure investment. Fine Gael is opposed, but such an entity would inevitably create some job opportunities.
A bonus overhaul: Bonuses may already seem like a distant memory, but rather than simply suspending the payments Labour wants a "fundamental review to ensure an alignment of interest between banks, their staff and the taxpayers". Details haven't been forthcoming, but it doesn't look good for your pay packet.
Fancy working for a credit union?: Getting involved in the not-for-profit, grass-roots level roles in mutual and credit unions may not appear like the most glamorous career path, but Labour's plans to revamp and modernise the sector would undoubtedly create jobs. For the people falling out of the retail banking sector, it could be a much needed lifeline.
Catchy campaign slogan: There is a better way
What Ireland's bankers can expect: It's safe to say, considering its radical proposals for the banking sector, financial services workers are not Sinn Fein's key demographic.
The most sweeping changes are its intention to nationalise AIB and Bank of Ireland and then merge them into a single state bank. Not only would this effectively wipe out the domestic banking sector, but would prompt huge job losses within these institutions.
It also intends to: Separate sovereign debt from private bank debt; abolish the bank guarantee; burn the bond holders - in particular Anglo Irish and Irish nationwide bond holders; introduce a bank resolution plant to protect depositors and enact the responsible wind-down of NAMA.
For those of you lucky enough to be earning over €100k, there'll also be a new 48% income tax band and for those with over €1m in assets, a new 1% 'wealth tax'.
Catchy campaign slogan: Renewing Ireland
What Ireland's bankers can expect:
An alternative third-force in banking: The Green Party is looking to establish a new, relatively low-fi, lender, based around co-operative principles and which could combine credit unions, build societies and Post Bank. This would be very much focused on small-scale lending, but could still provide new job opportunities, provided this doesn't involve getting rid of incumbent institutions.
And who's odds on to be in government after Friday's election? Find out here.
