Private Members Business – Banking Policy


Thank you for the opportunity to speak on this motion.  I wish to support the Government’s  counter motion as I believe that the work done to date to address the weaknesses exposed by the banking collapse needs to continue and also needs to be built upon in the months and years to come.

I must begin by acknowledging the fact that people all across the country are concerned at the number of recent withdrawals from the Irish market and are worried about the implications that this will have for competition in the banking sector in the future and this is something which must be a cornerstone of Government banking policy.

Bank of Scotland (Ireland) announced its decision to exit the Irish market some months ago, but the recent decision by ACC close on the heels of the decision by Dankse Bank, is what has caused alarm in the minds of many members of the public.

With a financial crash of the magnitude of that experienced in Ireland, financial retrenchment was somewhat inevitable.  Restructuring, cost saving and the re-design of products are issues that all banks operating in Ireland have had to face in recent years.

As the banking landscape continues to be moulded, products and services will change and price transparency will be key to ensuring that customers get good value for money from their banks.  Bank charges are a real cause of concern for many people and with a shrinking number of players in the Irish banking market, much needs to be done to educate consumers to ensure that they are fully aware of what their banking service is costing them and how those charges can be reduced.

I know that much work has been done in recent years in terms of allowing customers to switch their accounts between banks and this will have to be enhanced in coming months.  Customers also need to be made aware that in the current business and particular banking climate, there is little to show for being a loyal customer.  Those who shop around in banking terms are rewarded for their efforts and I believe that more must be done to make consumers aware of this.

I know that this Government is encouraging new entrants to the Irish banking market and that much of the problems experienced by banks who have now exited the market related to reckless lending during the property boom and new entrants can look forward to a much more stable and profitable banking landscape in Ireland, should they decide to enter the market.

The announcement in June of this year that the Government is to establish a Strategic Investment fund, which will absorb the National Pensions Reserve Fund and make the €6.4 billion resources in that fund available for commercial investment to support economic activity and employment in Ireland is very welcome.

A number of constituents have suggested to me that the existing structure of the ACC should be used for that purpose and I believe that that is a suggestion with real merit as the establishment of the ACC itself was with the view of providing investment to the agricultural sector to support economic activity and employment and so this would be a natural fit for 21st century conditions.

There were few winners in the crippling recession that Ireland has endured but one group that benefited significantly from the economic misery caused by job losses, income drops and shorter working hours was Ireland’s moneylenders. In the past eight years the number of people using money lenders has increased by 20 percent.  I know that there is a licensing system in place for money lenders and this was recently strengthened by the Central Bank, but I believe that more work remains to be done in terms of protecting people who use money lenders.

Many European countries have much lower ceilings in terms of the levels of interest that can be charged by money lenders and I believe that we should look at reducing the highest interest rates, while at all times mindful of the dangers of pushing Ireland’s poorest families away from licensed money lenders into the even more dangerous embrace of unlicensed money lenders.

To combat the lure of the money lender, we need a working Credit Union system and I know that the Minister is making every effort to ensure that a vibrant Credit Union is kept in place, one which individuals and families feel that they can approach in times of need.


Another issue that must be addressed is the future of banking for people who live in rural areas.  The population levels in Dublin and the surrounding commuter counties justifies the provision of a significant level of broadband, but many swathes of Connacht are without proper broadband access and thus online banking is not a viable option.  Added to this you have the closing down of large numbers of bank branches and a message being put across by banks that they don’t want to see you in branch and instead want you to do your banking online.

However, the reality is that this is not an option for a great many people in this country, not simply an older cohort who are unfamiliar with online banking or those who are reluctant to have all their bank details online (a reluctance that is even more understandable and justifiable given the events of this week and the data protection issues experienced), but also the many thousands who live in areas without access to high speed broadband.

This has serious implications not just for individuals, but also for many small businesses who are forced to hold cash on the premises because of the closure of local bank branches.

This Government has introduced significant legislative changes to build a strong banking sector, in light of the serious deficiencies exposed in the Irish financial sector.  We are working to ensure that householders and businesses small and large have access to the credit they need to manage and grow their activities, while at the same time ensuring that the proper oversight systems are in place to ensure that the collapse of recent years is never repeated and this I support the Government’s counter motion on this issue.