Fiona Muldoon’s speech earlier this week certainly rocked our country’s banks.
The Director of Credit Institutions and Insurance Supervision for the Central Bank castigated our lending institutions for their failure to deal with the country’s mortgage crisis.
Her straight talking was refreshing though and shows the Central Bank has changed for the better after a difficult few years.
The location of her speech was apt, the Irish Banking Federation conference. Here she was taking on the bankers in a room full of them.
It is this sort of attitude that is needed though to turn around a sector that now has 167,000 loans, with a total of €35 billion, in arrears.
There is little doubt that the banks were a large cause of creating the problem in which the country currently finds itself.
Over four years on from the State guarantee of our banks though and Ms Muldoon feels there is still a culture of leadership missing.
While her comments might not have went down well with bankers, she was only saying what most members of the public think on a daily basis.
It infuriates most common people that banks and developers are bailed out at a time when they and their friends, neighbours and families are struggling simply to put food on their tables each day.
The Irish Times give a brilliant account today of the problems that many people find themselves in.
The reality is that there a large number of people in this country who have mortgages that, short of winning the lottery, have no hope of every being repaid.
While these individuals must take responsibility for borrowing so much in the first place, equally the banks must shoulder a portion of the blame for taking too big a gamble on the loan.
Below this group there are hundreds of thousands of homeowners in negative equity but still making ends meet. That is fine up to a point but if these people need to move home for either work or family purposes, they are effectively hamstrung.
For any economy to run effectively, people need to have the option of moving.
Equally, younger first time buyers are being denied access to credit by banks who are afraid of getting burnt again by giving out loans that will ultimately end up costing them.
That too, is wrong as is the lack of credit being provided to SMEs to provide jobs throughout the country.
This week’s speech by Fiona Muldoon was refreshing. Hopefully it was just the start of the Central Bank flexing its might to ensure that we sort out our banking mess because until that happens, the country will never properly recover from the situation it has found itself in for the past few years.
Let us know your thoughts on the banks and what you thought of Ms Muldoon’s speech in our comment section below.