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Dysfunctional Banking market has frozen thousands of businesses out of growth - Tóibín

6 November, 2015

Sinn Féin TD Peadar Tóibín has cited one of the biggest failures of this government as their inability to create a functioning credit market.

Deputy Tóibin stated:

“The dysfunctional banking market in this state is a significant player in thousands of business being frozen out of growth. Little efforts have been made to relieve legacy debt to free up enterprise in its effort to grow. “

“When the Fine Gael and Labour Government created a banking market concentrated on two pillar banks they effectively created a Banking oligopoly.”

“It should be of no surprise therefore that these banks would display oligopolistic behaviour. This can be seen with the banks stating that business will happen in Ireland on their terms. With regards banking services it’s a sellers’ market. Proof can be seen in the high mortgage interest rate, high business interest rates, closure of bank branches in small to medium sized towns and now the prohibition of the withdrawal of less than €700 or the lodgement of less than €3,000 at the counter in some of its branches.”

“Rather than reform the banking market into a number of smaller non systemic operators two pillars were created which meant that in many cases viable small and micro businesses continue to suffocate because of legacy debt.”

“Even within the new consecrated market the government had an option. They could have cracked the whip and forced the banks to engage positively with enterprise.”

“This has not happened and as a result a new ecosystem of lending products from this government was created. The vast majority of which has failed to get the targeting flows of lending into businesses.”

“We in Sinn Féin have created detailed policies which if implemented would see a sustainable and competitive banking market. It would see the introduction of a Public Banking network modelled on the successful Sparkassen local banking network in Germany. This would add a new dimension and increase competitive behaviour amongst banks. It would rebalance the market towards customers. We have also introduced legislation that would allow for fairer interest rates. It important now that the Minister for Finance uses his influence and guarantee a fair banking system.”

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