The banking crisis that simply won’t go away

May 1st, 2009 by admin | Filed under Daily News, UK Bank Accounts, UK Banks, World Banks.

Just in case there was a bank director somewhere in the UK that was beginning to believe that public pressure and criticism of the bank’s role in dragging the UK into the deepest and probably longest running financial quagmire for the last 75 years or so, that official received a very rude awakening yesterday. The alarm call from hell came in the form of report from a Treasury committee that confirmed that the bulk of the blame came from the banks and their irresponsible reckless behaviour.

Understandably, the committee, consisting of Members of Parliament, was in full support of the government’s attempts to shore up the banking system. There were many and obvious nuances in the report that provided a definite impression that the committee was principally concerned for the customer’s interests and very little for the bank’s management and staff.

Looking to the future, and a possible recovery, the committee stressed that they were less than enthusiastic with the banks, who had only managed to increase their charges without making a serious effort to increase lending to small businesses and those who were interested in purchasing properties, and who met the necessary criteria.
The report also suggested that bank, in the future, should be much more closely regulated and added their support for the concept of a retail banking sector, which should be separated in its entirety from the commercial and investment banking sector.

The tone of the report adds weight to the current developments in the banking sector where well know high street retailers, with Boots and Tesco’s leading the way, will be competing with the High Street banks for custom. It will be interesting how the public will react to this new development.

In the meantime, the banks will have to work very hard to convince the public to bank with them and restore their confidence.