Ulster Bank has frozen c.126,000 bank accounts belonging to customers it believes are now longer reliant on them since November.

Speaking before the Oireachtas committee on finance, public expenditure and reform this afternoon, Ulster Bank CEO Jane Howard said that 224 affected customers had asked for the freeze to be lifted, primarily to facilitate the removal of funds.

In each case, Ulster Bank lifted the freeze "almost immediately" and provided extra support to the customers as needed.

The NatWest-owned lender said the accounts frozen had processed five of fewer transactions in a 31-day period before being suspended. Accounts belonging to known vulnerable customers or Social Protection recipients were not frozen.

Ulster Bank said despite the freezing of the accounts, there had been no spike in the number of accounts being opened with other banks, according to Banking & Payments Federation Ireland (BPFI).

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"What we can categorically conclude is customers with a current account with less than five transactions in a 31-day window, are no longer relying on Ulster Bank as their main service provider," Howard said.

"91% of Ulster Bank personal current accounts, are either closed, or with five or less transactions. This increases to 95% when personal deposit accounts are included. This trend continues to increase every day for customers approaching their six-month deadline.

"81% of Ulster Bank business/commercial accounts are either closed, or with 5 or less transactions. These numbers continue to increase every day."

There are now c. 5,500 Ulster Bank customers in receipt of Social Protection, compared to 171,000 this time last year, equating to a drop of 97%.

Howard said the company is working closely with the Department of Social Protection regarding the remaining customers, approximately half of who are in receipt of Child Benefit.

She warned, however, that the hold on freezing accounts of Social Protection recipients could not be Ulster Bank's "enduring position," although it will keep the situation under review.

The lender estimated that there around 20,000 personal current accounts that have gone beyond their six-month notice period and not requested an extension, despite customers being deemed reliant on said accounts.

"We are now moving to freeze these accounts as a last attempt to engage with these customers. We are ready to respond very quickly to support these customers," Howard said.

Ulster Bank shuttered 25 branches last month, 24 of which reopened under Permanent TSB on Wednesday, and its remaining 63 branches are set stop processing transactions at the end of March before closing for good on 21 April.

"This means from 31 March, customers will no longer be able to make cash or cheque lodgements either at the counter or through internal automation devices or make any form of a withdrawal at an Ulster Bank branch (except for ATM services)," Howard said.

"Our colleagues will remain in the branches for a further three weeks to help customers complete their move. Beyond that we will leave a field team of colleagues to support any customers who might still require support.

"Our telephony and online service channels will remain in place following the branch closures. We have been phasing the reduction of cash branch services for some time now."

C. 600 Ulster Bank staff will leave the company through redundancy programmes in the coming months, while 125 have transferred to PTSB.

Howard said Ulster Bank has deliberately waited to sell its portfolio of non-performing loans to the later stages or its withdrawal from the Irish market, and it has seen its stock of distressed mortgages fall 25% after applying a case clinic approach.

As a result, the mortgages of some 1,200 customers have either been included in Ulster Bank's sales to PTSB or AIB, or they have been redeemed or settled.

A further 1,200 customers with overdrafts in excess of €1,000 are being managed by the bank's arrears support unit, while 5,300 customers have an overdraft of less than €1,000.

Ulster Bank's credit cards will cease to function on 22 March, and there are 2,000 customers considered vulnerable who are receiving additional supports, with most expected to be set up with a new bank by the end of next month.

KBC update

Also appearing before the committee, KBC Bank Ireland CEO Frank Jansen estimated that around 26,000 of the bank's 130,000 current account customers still needed to open an account with another bank, down 50% from 52,000 in May.

The Belgian lender forcibly closed 3,000 accounts in December, and 90% of accounts held by vulnerable customers and those aged 65+ have been closed.

"There has been a 178% increase in current accounts with a zero balance, to date, more than 40,000 current accounts have been closed or are now blocked," Jansen said.

"Additionally, we have seen a significant decline in the overall activity across current accounts with debit card transactions down 61%, account balances down 50% and direct debits down over 62% to 82,000,

"Another key indicator of declining activity is the level of social welfare payments paid into current accounts, that has decreased by 75%, with just 3,200 accounts remaining in receipt of such payments," he added.

Jansen said 12 KBC branches would remain open until after loans have been transferred to Bank of Ireland. The number of employees transferring to Bank of Ireland remains unclear.

(Pic: Robert Alexander/Getty Images)