Northern Ireland banking market investigation reference (OFT)

The Office of Fair Trading (OFT) referred the Northern Ireland banking market to the Competition Commission (CC) for investigation.

Action before reference

See link to the Northern Ireland banking super-complaint that led to this reference.

Reasons for reference

Date of reference: 26 May 2005

The OFT has referred the Northern Ireland banking to the Competition Commission (CC) for investigation. There are features of the personal current account market in Northern Ireland which the OFT suspects restrict competition, and which warrant further investigation by the CC. There is a high level of concentration in the market and the OFT found evidence of behaviour among the four largest banks leading to, or demonstrating, weak competition between them. For example:

  • they impose a number of charges when customers are in credit and overdrawn which are not found in the rest of the UK (and there are no offsetting advantages such as higher interest payments on positive balances)
  • they do not actively compete on price and there is evidence of parallel pricing behaviour among them, and of possible price leadership and price signalling they do not actively compete for customers switching accounts.

In addition there appear to be low levels of switching by customers, both between rival banks and to alternative accounts within the same bank.

Key documents

Information on the Competition Commission’s personal current account banking services in Northern Ireland market investigation is on GOV.UK.

Published 26 May 2005