The possibility is that a decision on formal agreed reduced arrangement has not yet been made by the bank, which could explain why your friend got the notice of termination of the banker/customer relationship letter from the bank, so obviously your friend should bring it to the attention of the debt management company as a matter of urgency.
On a side note I have read in this thread
http://www.askaboutmoney.com/showthread.php?t=129694 that PTSB will not accept payments made by a debt management company on behalf of their clients, so I don’t know whether or not this might be the case with your friend.
I’m sorry to hear of your own forthcoming situation, & I’d suggest that you don’t get put off by your friend’s one. Most banks would prefer to deal with MABS rather than a debt management company. If you haven’t already you might want to have a look through their website
www.mabs.ie & maybe make an appointment to see them, despite their current backlog. Also, if you have a mortgage you might want to check out the possibility of claiming a mortgage interest supplement if & when the time comes
http://www.citizensinformation.ie/c...-welfare-schemes/mortgage_interest_supplement as well as asking your lender to switch to interest only for a set period.
MABS can negotiate on your behalf, or they supply sample letters on their site that you can use as a basis for contacting other creditors advising them of your change in circumstances & requesting reduced payment arrangements.
As Towger says you may want to move any funds to another bank now, but as I said above the bank would only terminate the banker/customer relationship if you fail to engage with them or fail keep to a reduced repayment arrangement agreement. If they do this & pursue you through the courts it doesn’t matter where you have the funds, so opening a new bank account is not going to solve any long-term problem, & could look worse on your part in the long run. This is just my opinion.