Monday 18 December 2017

Risk of letting banks go under

DAVID McWilliams blithely asserts that banks can be allowed to go under like any other business (Irish Independent, April 20). He writes that any bank which can no longer survive without government support "should be given to a liquidator to get the best price for any assets it has". Given his financial background, David must be aware that a bank's assets consist mainly of loans and mortgages to customers.

A liquidator seeking to realise such assets would have to demand immediate payment of all outstanding loans to individuals and to businesses. What would that do to our economy I wonder? -- not to mention the further toll of human misery inflicted on tens of thousands of bank customers.

Of course, a liquidator could try to sell the loans, at a discount to another (solvent) bank.

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