DANSKE Bank has returned to profit in Northern Ireland for the first time in six years - but is set to pull out almost entirely from the Republic.
Around 150 jobs are expected to be axed as the Danish-owned group stops all but its corporate services south of the border.
Banking unions meanwhile warned that the move could put 90 more positions under threat in the north.
Danske Bank announced that day-to-day personal and business products and services would be withdrawn on a phased basis to southern customers during the first six months of next year.
However the bank - formerly Northern Bank in Northern Ireland and National Irish Bank in the Republic - said it would remain committed to its corporate and institutional clients.
The cuts come as it reported losses in the Republic of e 31.4 million (£26.7m) before tax for the first nine months of 2013.
There was much better news for Danske in Northern Ireland with pretax profits of £1.4m over the same period.
That represented a massive swing from losses of £35.5m for the first nine months of 2012, largely due to a 66 per cent reduction in bad debt to £41.2m.
Danske is the second institution to quit the market in the south in a week, after ACC Bank announced plans to close all its branches and business centres.
IBOA general secretary Larry Broderick said it was a "sad day for staff and consumers".
Gerry Mallon, head of Danske Bank UK and Ireland, said: "The decision regarding the personal and business banking divisions is necessary to stem the losses that continue to accrue in those units.
"Against the backdrop of the difficult economic and trading environment in Ireland, the bank has been unable to re-establish a sustainable retail banking business model."
He said there would be no changes for existing personal customers until the first half of next year.
Mortgages and personal loans will continue in line with existing terms and conditions.
Customer deposits will be repaid in full and continue to be covered through Danish and Irish guarantee schemes up to a maximum of €100,000 per depositor.
Mr Broderick said the IBOA was "extremely concerned" by the announcement which he said "will have major consequences for many of Danske's customers in the Republic as well as for a large number of Danske employees in both the Republic of Ireland and Northern Ireland".
"While we have been assured by the bank that any job losses in Northern Ireland will be implemented by either natural wastage or voluntary severance, we believe it would be timely for the parent Danske Bank Group to give a firm commitment to Danske Bank in Northern Ireland to counteract the uncertainty being felt by staff following today's announcement," he said.