Seanad debates

Monday, 3 July 2006

Photo of Shane RossShane Ross (Independent)

I endorse the call for a debate on financial institutions. It is important to realise that we are in a position of dangerous overlending. This is not exclusive to credit cards. Banks are lending people money which they will not be able to pay back, giving them a short-term injection for a long-term burden. That will be serious if the economy takes any sort of downturn.

Banks lend at between 16% and 18% on some credit cards, which is outrageous and exorbitant but if one places money with them one earns less than 0.01%. In other words, if one borrows €1,000 one pays approximately €190 a year but if one places that sum with them one earns approximately ten cents. That is an extraordinary statistic. Banks also lend too much in the housing market, especially in an era when interest rates are going up and people will be badly caught.

It is time the Seanad called a halt to this activity. I do not know our rules but I do not see why we should not call in some bankers and ask them a few questions.

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