If there is a fine line between audacity and idiocy, AIB surely crossed it with its plan to remove cash from so many of its rural branches. It is difficult to do a hasty reverse with dignity, especially after you have fallen flat on your face. It is also a good few years since Joseph Stiglitz said: “We have banks that are not only too big to fail, but too big to be held accountable.”
It still seems remarkable that AIB, in which the State has a major stake and which only exists because of the help of taxpayers, could think it would be answerable to no one should it inconvenience so many of its customers by withdrawing such a key service.
It has been claimed that in every class of society, gratitude is the rarest of all human virtues, but the lack of it in some of our leading lending institutions borders on the breathtaking. Had it not been for the late intervention of Taoiseach Micheál Martin, there is every reason to believe the move would have gone ahead.
It is worth noting that banks are supposed to exist to serve their customers, not themselves. Money is supposed to be their servant, not the other way around. When profits are driven to the point whereby the customer is no longer a priority, there is always going to be a problem. As Mr Martin reminded the bank before its U-turn: “I think the banks are part of society; they’ve got obligations as well in terms of the social contract.”
AIB had tried to justify its decision, citing technological priorities. It pointed to a dramatic increase in the use of digital banking services and a decline in branch visits.
Its statement cited 2.9 million daily digital interactions compared with 35,000 customer branch visits. It also said there has been a 36pc decrease in cash withdrawals from ATMs over the past five years.
However, this period included the pandemic, when social and commercial personal interaction almost ceased. It seemed especially disdainful to have attempted the move before the comprehensive state review of retail banking is completed later this year.
The whole business model for banking is being put under scrutiny. To have exercised such a manoeuvre while this was in train looks like over-playing their hand.
It is surprising the Government moved so late, having been informed four days before the announcement. If the banks have a key role in maintaining the flow of cash through the economy and ensuring appropriate access to services for all, the State has a duty to make sure they do their job.
From the crash to the handling of tracker mortgages, the banks have shown they are still capable of surprising us.
But AIB has taken this to a new level by simultaneously shooting itself in the foot and stabbing itself in the back.