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EBS to close Buncrana office 26.05.11

by Linda McGrory

MORTGAGE arrears in Inishowen are "a lot higher" than the national average with scores of families behind in their monthly repayments.
That's according to a local director of the Educational Building Society who confirmed that the Buncrana office will close at the end of this month.
EBS director, Fintan Connolly, said the office, at St Mary's Road, would shut its doors on May 31 with all operations moving to the company's Letterkenny headquarters.
Mr Connolly said there would be no job losses, with the three Buncrana staff members relocating to Letterkenny. However, he said staff numbers, between Buncrana and Letterkenny, had fallen from a boom-time high of 16 to five now, including himself.
The EBS has been in operation in Buncrana since 1985. It has hundreds of mortgage holders in Inishowen and thousands around the county. Mr Connolly said the company was "saddened" to be leaving Buncrana after 26 years.
"It's a reflection of the banking system in Ireland at the moment and there is a lot of consolidation going on within the banks. EBS, as part of the new two pillar system, will become part of the AIB group.
"In addition to that, in terms of properties and lending, very little of it has gone on for some time, the way the property market is in Donegal as well as the rest of the country. The levels of lending have drastically reduced over the last three years.
"With that in mind and the other developments within the banking industry in terms of trying to cut costs and everything else, the decision was taken to close the EBS office in Buncrana." The EBS will formally become part of the AIB group on July 1.
The EBS expanded its Buncrana office in 2002-2003 with seven or eight people employed there. "It's sad to see that, as a result of the way the economy has gone, realistically there just isn't a demand for that service (in Buncrana) anymore.
Mr Connolly said that, at the height of the property boom, the Buncrana office was in the EBS' top 20 outlets nationwide in terms of lending levels.
But he said that, from the highs of 2006 and 2007, there had been a drop of about 85% in lending.
Meanwhile, he said while an average of around 6% - 7% of mortgage holders nationally were now in arrears, the level in Inishowen was "a lot higher" and possibly as high as 10%.
"Predominantly, what we have been doing over the last number of years is trying to help people over their difficulties, trying to restructure their mortgages, seeing if we can lengthen the term...any way basically of bringing the monthly cost down for them and trying to keep them in the properties." He said home loan arrears were a "huge problem" in the peninsula at the moment.
"Inishowen was heavily reliant on the construction industry. A lot of the mortgages we provided over the years were to young couples and a lot of them would have been working in the construction industry. They are obviously finding it very difficult now.
"Inishowen has been very badly hit by unemployment and that has obviously had a major impact on how people can pay their mortgages." Mr Connolly said the main focus of the EBS, since the downturn took a grip, was restructuring loans for families in difficulty.
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