The banks – ‘lifting the lid on a shameful episode’

A chara, – Your leader “Lifting the lid on a shameful episode” (October 18th) describes the current unsatisfactory banking situation in Ireland but is light on proposals.

Surely, to borrow a phrase, the point is not to explain it but to change it.

The banking sector in Ireland is uncompetitive. Contrast this situation with Germany’s 5,000 banks of varying form and purpose.

A good start for change would be to increase the powers and service range of the already strong credit union movement.

In addition they could be facilitated to create a national bank for credit unions based on their own values and principles to spread the risk of long-term investment.

This could be enhanced by building a network of financial service centres based on the existing post office network.

This network would enable the entry into the market of more small, niche banking services providers using the network as their retail outlets. This could also be backed by a national post office bank.

Drawing on overseas experience we could promote sectoral banks such as Crédit Agricole, possibly by inviting them to establish in Ireland, and review the banking needs of other sectors.

We could promote the formation of building societies for housing, in particular the innovative idea for a “safety net” building society for those house-buyers currently in negative equity.

Finally we could have regional development banks for Munster, Connacht and Ulster whereby local savings could be channelled into local infrastructure projects, as happens in many EU member states.

Once this structure is in place, then market forces will do the rest.

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The “pillar” banks will wither, and deservedly so. – Is mise,



Co Louth.

Sir, – Another bank scandal washes up on the shore of Irish public life; yet again we hear calls to “punish” the banks.

This punishment proposed is often in the form of more fines or levies. Imposing a financial penalty on a bank punishes three groups of people: the customers, the shareholders and the taxpayers.

Why would any bank mend its ways given that it can always pass the pain on to innocent third parties?

Banks are run by bankers, and banks will not desist from malpractice until individual bankers are named, shamed and, above all, jailed.

For each of the tracker horror stories of lives damaged or destroyed by what is to all intents and purposes theft and intimidation, there is some individual or group of individuals in a bank who made the decision that caused it.

For each mistreated customer who was hounded to the steps of the High Court or Supreme Court, there was a banker, an individual, and probably a senior one, who approved of and signed off on that action.

We need laws that oblige financial institutions to identify such decision-makers so that they can be prosecuted in the public courts.

It cannot be dealt with by internal inquiry.

It cannot be dealt with by so-called self-regulation.

It cannot be dealt with by impotent central banks.

It cannot be dealt with by blaming it on “the system”.

Proper accountability starts with and ends with people, and the use of meaningful sanctions for failure.

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Firing the chief executive is not enough if the rot goes all the way down the line and needs to be rooted out all the way down the line.

Voltaire once observed that the English shoot an admiral every so often to encourage the others.

A few bankers serving time in Mountjoy might have a salutary impact on banking practice in this county. – Yours, etc,


Dublin 4.

Sir, – As well as blaming the banks for “beggaring the country”, as Desmond FitzGerald (October 20th) puts it, we should, I presume, blame the estate agents for forcing people to buy houses they couldn’t afford, as well as luxury car dealers for making people buy cars when clearly they couldn’t afford them.

Oh, and let’s not forget the travel agents who forced an unsuspecting public to take luxury holidays they clearly couldn’t afford.

As for stockbrokers who sold shares that inexplicably did not continue to endlessly rise in value, they should doubtless be strung up.

When will we learn that we are all to blame for our own greed and for continuously living in fear of missing an opportunity?

It’s quite simple really you should not spend beyond your means, and if you do you only have yourself to blame!



Co Dublin.

Sir, – Further to “Tracker mortgage overview – which banks are playing ball?” (October 20th, may I respectfully suggest that all journalists quoting the “number of customers affected” insert the words “as currently alleged by the banks” after that phrase? – Yours, etc,

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Dublin 8.