Sunday 21 December 2014

Banks win – lose or draw

Published 09/12/2012 | 05:00

Madam – Letters continue to flow in berating developers. Clearly many of your readers do not understand the basics of business and borrowing, or at least choose not to know. I have no doubt that those who decry builders and developers are in business themselves as they most likely have mortgages and car loans. All business loans are made up of loan value and borrower equity input. Banks are responsible for due diligence on these matters, not the borrower. The facts are unchallenged worldwide.

Banks oversupplied money to not just the building industry but all other sectors where there were willing clients.

Entrepreneurs create wealth, and employment and developers are just one of the groups of such people.

The bubbles in all facets of business will come and go, laying waste as they do so, and as always only the financially strong and prudent survive. Basics never change.

What is abundantly clear in hindsight is that individual borrowers were not aware of the quantum and toxic effect of loans offered throughout the country and abroad. The ones who should have known were the long departed bank bosses, and these have yet to be made accountable for the damage caused to the country.

They appear and disappear like Premier League managers, flitting from one failed assignment to the next where large exit fees are commonplace.

The Beach Boys spring to mind, ie wouldn't it be nice to be in a business where failure equals bonus? Due diligence? I don't think so. Let's hope we get accountability and closure soon.

Denis Finn, via email

Sunday Independent

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