Thursday 20 July 2017

Call banks to account

THE Government is trying once again to bring the banks to heel with plans to force bailed-out lenders to set targets for lending.

Previous targets have come and gone. Similar measures have also been tried in other countries and they, too, have failed to yield concrete results. It seems it is not easy to force banks to lend in this climate and it is worth remembering that it is not always wise.

The Government clearly has few doubts and has taken the view that more credit is needed. Unfortunately, its new plans appear complex and cumbersome; the banks will have to meet ministers such as Richard Bruton and Joan Burton to discuss lending in their sectors as well as ministers such as Michael Noonan. Instead of involving so many politicians who are distracted with many other tasks, it would almost certainly make much more sense to appoint a single, well-informed minister with a gimlet eye to oversee the financial services sector and ensure compliance with government wishes.

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